Tech, ExplainedE-commerce, travel and logistics
Part

Social commerce

Reshared on WhatsApp, sold in small towns.

INSIDE: ONLINE MARKETPLACEHOW IT WORKS · A RESELLER'S WHATSAPP GROUP IN INDOREThe resellerfinds a cottonkurti in the appfor ₹349She shares itin a group of150 contactsat ₹409, witha ₹60 marginA neighbourasks for amedium sizeThe resellerorders it at₹409, cash ondelivery, to theneighbour'saddressThe couriercollects ₹409 atthe doorAfter thereturn period,₹60 is creditedto the resellerALSO TALKS TOWhatsApp Business API and RCS↗ BUSINESS MESSAGINGINSIDE: ONLINE MARKETPLACEHOW IT WORKS · A RESELLER'SWHATSAPP GROUP IN INDOREThe reseller finds acotton kurti in the appfor ₹349She shares it in a groupof 150 contacts at ₹409,with a ₹60 marginA neighbour asks for amedium sizeThe reseller ordersit at ₹409, cashon delivery, to theneighbour's addressThe courier collects ₹409at the doorAfter the returnperiod, ₹60 is creditedto the resellerALSO TALKS TOWhatsApp Business API and RCS↗ BUSINESS MESSAGINGINSIDE: ONLINE MARKETPLACE · A RESELLER'SWHATSAPP GROUP IN INDOREThe reseller finds a cotton kurti in theapp for ₹349↓She shares it in a group of 150 contactsat ₹409, with a ₹60 margin↓A neighbour asks for a medium size↓The reseller orders it at ₹409, cash ondelivery, to the neighbour's address↓The courier collects ₹409 at the door↓After the return period, ₹60 is creditedto the resellerALSO TALKS TOWhatsApp Business API and RCS↗ BUSINESS MESSAGING
A reseller in Indore shares a ₹349 kurti in a WhatsApp group, adds a ₹60 margin, orders it for a neighbour by cash on delivery, and receives the ₹60 after the return period.
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Social commerce is selling through social sharing: buyers find products in an app and share them with friends and family, often on WhatsApp, who then order them. In India, the term usually describes a marketplace model built for smaller towns. It sells mostly unbranded goods, charges sellers no commission, and grows because buyers share its products.

Each of these three choices has a reason. Unbranded goods, such as kurtis, sarees, bedsheets and kitchen items made by small factories, are cheap. That suits buyers who spend carefully. Zero commission means a small seller keeps the full sale price, so many small sellers join. The marketplace earns its money in other ways instead, such as from sellers who pay for ads and from delivery charges. Sharing brings in new buyers who have never shopped online, because a friend or a relative sent them the product and vouched for it.

Many of these buyers started as resellers. A reseller does not hold any stock. She shares a product from the app with her contacts, adds her own margin to the price, and places the order on the buyer's behalf.

Consider a homemaker in Indore who runs a WhatsApp group of 150 neighbours and relatives. She finds a cotton kurti on the app for ₹349 and shares its photos in the group. She tells the group that the price is ₹409, which includes her margin of ₹60. A neighbour wants it in a medium size. The homemaker places the order in the app at ₹409, with the neighbour's address, and chooses cash on delivery. The marketplace sends the order to the seller, a small garment unit, which ships it. The courier collects ₹409 from the neighbour at the door. After the return period ends, the app credits the ₹60 margin to the homemaker's bank account.

Cash on delivery helps buyers who do not trust paying online. But a buyer can also refuse the parcel at the door, and the seller then pays for shipping both ways. The page on cash on delivery and RTO explains this cost.

Social commerce is one part of an online marketplace. It is different from conversational commerce. In conversational commerce, a business chats with a buyer, often through the WhatsApp Business API and a bot. In social commerce, the buyers and resellers share the products among themselves, in their own personal chats. This model took online shopping to many of India's smaller towns, and its largest app now has more orders than most marketplaces.

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