Nokia Siemens Networks

Pioneering business model lets rural consumers shop online

Nokia Siemens Networks and Fujian Mobile have successfully piloted an integrated online shopping system that enables businesses to reach rural consumers via their local village shops.

The online shopping model challenges traditional ways of conducting business and purchasing goods in remote locations - villagers gain access to a wider selection of reliable consumer products, and urban suppliers are provided with a new sales channel reaching the mass market in villages. The new system can also help communications service providers increase revenues and raise their profile locally. It demonstrates that communications service providers can build a sustainable rural Internet business, provided they are willing to embrace novel business models and solutions.

The Nokia Siemens Networks rural eCommerce concept enables a bigger business (the product supplier) to use small local businesses (village retail shops) to promote and sell its products to rural consumers. It also provides a realistic business model for CSPs looking to deliver Internet services to rural communities.

Helping villagers overcome real issues

In many emerging markets, businesses find it hard to reach rural consumers owing to insufficient distribution and information systems. Many rural small and medium retail/distribution players cannot afford to be online, so their business remains rooted in the traditional form of local village shops selling a limited range of goods.
Meanwhile rural consumers are increasingly demanding access to a wider range of products and services, and communications service providers are looking to improve their local presence in rural areas.
The Nokia Siemens Networks eCommerce system delivers an effective solution for all these stakeholders.

An integrated solution

The system uses a new Internet service delivery approach based on shared access on shop premises. Sharing cuts the cost of using Information and Communications Technology (ICT) by aggregating the needs and spending power of the local community.  
An up-to-date and accurate flow of product information is provided via a Catalog Sales Platform. Communications service providers can use the concept to gain access to new Internet revenue potential from business-to-business (supplier-to-shop) transactions, rather than simply business-to-consumer.

The role of mobile devices

In addition to the shop-based terminal, mobile phones play an essential role in the Catalog Sales Platform model, enabling all the different stakeholders to keep in touch, even if it is only via a simple SMS message.
The business model has been piloted successfully over five months at two counties in Fujian province of southeast China in partnership with Fujian Mobile and local retail suppliers. Nokia Siemens Networks has collaborated closely with Fujian Mobile and provided extensive consulting services in identifying this new opportunity.

Nokia Siemens Networks now aims to take the project’s lessons and the business model and apply it to other rural markets.