Recently
I attended a talk by some IBM employee in my university. He was
narrating an incident about a person he knew let’s call him Tim,
and how Tim’s unmarried daughters pregnancy news was known to a
supermarket’s data-analytics engine (studying the buying patterns
of that girl with other pregnant women of her age) months earlier
compared to Tim. The IBM employee was boasting the power of
Data-Analytics, Machine learning and how quickly machines and
algorithms can predict real life events. Although it might appear a
“+1” to the machine vs. human race, to me it sounded very
disturbing. Coming to our topic, the fundamental problem with
Electronic Commerce is the big time invasion of your privacy. All
your buying patterns, items you click on, items you add to wish list,
taboo sections you won’t normally dare visit in “traditional
stores” all get recorded in one huge giant database. And it is
bound to happen sooner or later, as happened with Tim, when he
received a mail suggesting him to plan in advance a baby-shower,
leaving him completely flabbergasted.
Moving
on from privacy, it is common knowledge these days India has seven
billion dollar valuation companies comprising the likes of Flipkart,
Snapdeal, Amazon India and Myntra. While to a layman the word
valuation might not appear in his dictionary as it may seem these
companies must have skyrocketing profit margins. Well the reality is,
Flipkart in the FY 2014 reported a 400 crore loss, Amazon.in with
321.5 crore loss and Snapdeal with 264.6 crore loss. Now these
numbers might be arguable, let me hit the nail right in the coffin.
Google “Snapdeal loss 2015” and you will come to know, Snapdeal
has incurred a loss of Rs. 1350 crores
this year. According to Techcircle, Flipkart is losing Rs. 2.23 for
every Re 1 in net revenues. Research also goes on to predict, “It
is highly unlikely any of these companies will start to profit in
terms of revenue before the year 2020.” Now even a layman would
understand the actual reality is in contrast to perceived reality.
The companies are shelling out huge amount of money and incurring
losses by providing attractive discounts, only for customer
acquisition and brand value. To a common Gujarati, alarm bells would
surely be ringing by now as this industry could be a ticking landmine
waiting to burst.
In
the final paragraph I would like to briefly go over some other
alarming scenarios. In a quest to promote and acquire customers,
Newspapers have taken an absolute beating. It is shambolic to see
front pages ridiculed with “big billion sale” promotions. With
the way things are progressing our progeny might never know the
meaning of “long term customer loyalty” or “goodwill and trust”
as our parents currently do. In the traditional commerce, prices were
decided by the local market meanwhile in the electronic commerce they
are decided by the global market. For a country like India, where
domestic trading is
a major occupation, the underlined is has turned to was, as they have
received a severe beating and the local traders has been driven out
of their livelihood by the world of E-Com.
I
am not sure what sort of a world we are venturing into, where
Snapdeal sells houses, Ola offers boat and cafe services and Mobile
makers preferring to sell phones online in listings and invites. The
world is changing, true. We have to change with changing times, true.
But only a fool won’t be cautious, what price we are paying for
those changes as the cost of privacy and human relations are not
known to many. I am sure like Tim you too will understand the gravity
of the situation from Erich Fromm’s saying, “The
danger of the past was that men became slaves. The danger of the
future is that man may become robots.”
