Meta Platforms (META) Collaborates With Jio Mart in India
Meta Platforms META recently announced partnership with Jio Mart in India and launched the first end-to-end shopping experience on WhatsApp.
WhatsApp users in India can browse the JioMart catalog, add products like groceries to their cart and pay to complete purchases, all within WhatsApp without leaving the chat.
Meta’s recent launch is part of its strategic partnership formed with Jio platforms in 2020, which will help it accelerate e-commerce growth. To this end, META will leverage India’s digital transformation by providing people and businesses of all sizes with opportunities to socialize and buy products from a single platform.
Meta Invests Heavily in Boosting E-commerce and Revenues
Meta Platforms benefited from a surge in e-commerce during the COVID era, which led to strong revenue growth. However, the trend subsided a bit, slowing down growth in e-commerce revenues. META is also currently facing the worst downturn in its history with its declining digital advertisement revenues.
The recent fall in revenues can be attributed to geopolitical tensions like the Russia-Ukraine war, which reduced META’s monthly active users across its family of apps, namely Facebook and Instagram. Also, rising inflation weakened digital advertising revenues. The global economic downturn is currently witnessing a worse phase than what it was a quarter ago. This, in turn, hurt investors’ sentiments around the ad-revenue-dependent companies.
Shares of Meta Platforms, which currently has a Zacks Rank #5 (Strong Sell), have tumbled 51.5% in the year-to-date period compared with the Zacks Internet – Software industry’s decline of 48.9%.
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Intensifying competition for ad dollars and user engagement from the likes of Snap SNAP, Twitter TWTR and TikTok is another persistent headwind. Also, as META is trying to rebuild its e-commerce business, it is facing severe competition from Amazon AMZN in this segment.
Snap is benefiting from improving user engagement, particularly in the 13-34-year-old demography, which is expanding its advertiser base. SNAP is also giving competition to META in the metaverse space. It collaborated with Vogue to feature a virtual try-on experience of select pieces from Balenciaga, Dior and Gucci, which will be available for snapchatters, globally.
Even as Meta Platforms is investing aggressively in building the metaverse, Twitter surpassed it as the first social media giant to enter the non-fungible token marketplace by launching a tool to showcase and sell NFTs on its platform.
Amazon is the largest e-commerce company in the world with a strong presence in India. At a time when Meta Platforms is looking to enter the grocery delivery space with JioMart, Amazon is already a name to reckon with in that area with its drive-in-grocery delivery service, AmazonFresh Pickup.
Although Meta Platforms’ short-term revenue growth looks bleak, it is confident about its long-term prospects. META is pumping resources into developing AI to address solutions for megatrends like a hybrid work environment, which will drive its user base across various platforms like Meta Portal Go.
Investments in AI are also expected to draw higher revenues from Meta’s ad business. Also, Meta’s investment to grow its e-commerce in India will aid its top-line growth.
India is the largest market for Meta Platforms in terms of people using the WhatsApp platform. While India is transforming into a digital society, a huge community is yet to log onto the online shopping platforms.
Meta is leveraging its newly-launched easy-to-use feature on WhatsApp, which is quite hassle-free even for first-time users. This is expected to boost Meta Platforms’ e-commerce business growth in India amid stiff competition from rival online platforms like Swiggy, Amazon and Blinkit.
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