Now Tata Group to make a foray into ecommerce

The e-commerce bug has finally bit one of largest corporates in India. The Tata Group is planning to jump into the e-commerce

market to grab a pie of this prospering business. The conglomerate would launch a marketplace model directly competing with Flipkart, Amazon India and Snapdeal. The new venture would fall under Tata Industries, a fully owned subsidiary of Tata Sons.

Launching a marketplace model makes sense around the time when the new government has already expressed its opposition to FDI in multi-brand retail and e-commerce platforms directly retailing their own products in the country. But foreign investment is allowed under the marketplace model, which also lets several vendors to sell their wares on the common platform hosted by likes of Flipkart or Amazon. Marketplaces make money by charging fee or commission from merchants using them.

Sources claim that Tata is contemplating building its e-commerce business, based on Tmall.com, the Alibaba Group's marketplace. This, along with B2C marketplace Taobao.com, generated about 248 billion dollars (over Rs 15,00,000 crores) in gross merchandise sales last year for the Chinese company, more than that of Amazon.com and eBay put together.

The platform is slated for a launch next year with initially showcasing Tata's existing retail chain brands such as Westside, Croma and Star Bazaar. Tata may also retail merchandise of its joint venture partner Zara, which otherwise sells online only through its own sites globally.