ITC Bids Adieu to E-Commerce, Shutters Online Store

Almost five years after opening the digital marketplace, FMCG conglomerate ITC has shut down its online store. The "ITC Store", which was established in November 2020 during the height of the COVID-19 pandemic to take advantage of the spike in online sales, has ceased accepting orders.

The independent online store has "served its purpose", an ITC representative told a media house. According to reports, the FMCG major is currently embracing a multi-platform digital distribution strategy that encompasses modern trade, e-commerce, and rapid commerce.

The corporation is bolstering its position in general trade and concentrating on digitally enabled sales, according to the report.

Focusing Distribution on Major E-Commerce Players

Interestingly, ITC's items can also be found on speedy commerce and e-commerce sites like Amazon, Blinkit, and Instamart. In sectors like food and personal care, the company's portfolio includes brands like Aashirvaad, Sunfeast, Bingo!, Fiama, Vivel, and Classmate, among others.

A representative for ITC added that the company has improved its selection and mix on these platforms, which has resulted in a notable increase of more than 50% in these channels (rapid commerce and e-commerce).

The growth coincides with India's urban environment quickly adopting quick commerce, as evidenced by the arrival of up to 19 new competitors in a variety of categories in recent months.

Quick commerce's success has also increased competition, forcing well-established companies like Zepto, Swiggy Instamart, and Zomato's Blinkit to make significant investments in order to expand their product lines, provide discounts, and grow their network of dark stores.

Several Packaged Companies Opting for Online Distribution Channel

In order to meet the increased demand for online shopping following COVID-19, a number of other packaged goods businesses, such as Nestlé, Amul, Dabur, and Marico, established their own e-commerce platforms.

However, the initiative's primary goal was to attract new clients rather than compete with established giants of e-commerce or rapid commerce. By selling directly to consumers, these businesses were able to reduce distributor and retailer margins by owning their own web platform.

Additionally, it made it possible for tiny businesses to stock their whole product line, something that isn't possible on bigger e-commerce sites like Amazon or Blinkit.

By providing up to 40% off of their items, which ranged from soaps to necessities, the majority of these businesses aimed to increase their clientele. Nevertheless, ITC was forced to halt operations and reassess its strategy after it seemed to have failed. "Not processing any orders currently" is the message that is currently displayed on ITC's website.