Reliance Jio expands its trial phase to retailers

Reliance Jio has expanded its by-invitation trial offer to its retailers. While the company has no immediate plans to open up the Jio service to consumers, it has launched a programme under which retailers will be able to offer a limited number of Jio connections to customers buying Lyf handsets.

Reliance Digital and Reliance Digital Xpress stores have been given a limited number of invitations that can be used to refer customers interested in buying the Lyf phone with the Reliance Jio 4G connection. Moreover, there is a cap on the invitations that can be given to a particular Reliance Digital store per day.

According to sector sources, Jio is sitting on an inventory of more than two million Lyf handsets it imported last Diwali. The move could be aimed at clearing the inventory. The Reliance Digital and Reliance Digital Xpress stores the Business Standard spoke to in Bengaluru, Delhi, and Mumbai said the process continued to be based on invitations, but now they could provide invitations to walk-in customers. Retailers were given five to nine invitations to begin with to keep the load on the network in check, sources said. This was happening under Jio's new scheme called the Retailer Referral Programme, which allowed retailers to refer customers as they walked into stores and allowed them to buy the handset with the 4G service, sources inside the company said.

"As of now, we have received nine invitations. If a customer comes in to buy a Lyf handset with a Reliance Jio 4G connection, we can use these invitations," said Jasvinder Sondh, a sales executive at a Reliance Digital Xpress store in Mumbai. "But the internal process is the same. It is still an invitation-based system," he added. Yogesh, sales executive handling Lyf phones in a Reliance Digital store in Bengaluru, said, "A customer can come to our store and we can provide the invitation internally. This way, he can buy the phone with Jio 4G."

What this means is Reliance Jio has not launched its 4G service commercially and the move is designed to expand its trial phase. There is no clarity whether the company will announce tariff plans after providing free service for three months.

Industry analysts have found Lyf handsets overpriced when compared to other brands' handsets with comparable hardware specifications.

"Jio's Lyf branded handset has lower specifications than similarly priced handsets in the market. Build quality of the handset is also not encouraging, especially in light of launches by Chinese players like Xiaomi, Le Eco and Oppo," said Sandip Agarwal and Pranav Kshatriya of Edelweiss Securities in a note dated May 10.

"Even Indian players like Micromax, Karbonn and Intex offer higher specifications at similar price points," the added.

A research report by IIFL Institutional Equities said, "The handsets are sturdy but are 40-60 per cent overpriced compared with better specced Chinese smartphones, which could inhibit their intake during the trial period. With Indian consumers increasingly focusing on superior hardware quality at low prices and decreasing shelf life of smartphone variants available, this could spell trouble for the company."

Trial offer expanded
Reliance Jio has expanded its by-invite trial offer to its retailers, they can now offer offer invites to buy Lyf phones

Referral programme
Launched in May, where each employee could invite up to 10 friends to buy Lyf phones with Jio 4G offer