RJio expands trial phase via retailer referral programme

Reliance Digital and Reliance Digital Xpress stores have been given limited number of invites, which can be used to refer customers interested in buying Lyf phone

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

Reliance Digital and Reliance Digital Xpress stores have been given limited number of invites, which can be used to refer customers, who are interested in buying the Lyf phone with the Reliance Jio 4G connection but do not have invites from RIL employees that allow them to do so. Moreover, there is an upper cap to the invites that can be given to a particular Reliance Digital store per day. According to industry sources, Jio is sitting in an inventory of about 2 million Lyf handsets which it imported last Diwali. The move could be aimed at clearing out the inventory.

The Reliance Digital and Reliance Digital Xpress stores, Business Standard spoke to in Bangalore, Delhi and Mumbai said the process continues to be based on invites, but now they can also provide invites to walk-in customers. Retailers were given five to nine invites to begin with, in order to keep the load on the network in check, said the sources.

This is happening under Jio's new scheme called Retailer Referral Programme, which allows retailers to refer customers as they walk into the stores and allows them to buy the handset bundled with 4G service, the sources inside the company told this newspaper.

"As of now we have received nine invites. If a customer comes in to buy Lyf handset with Reliance Jio 4G connection, we can use these invites for the customer," said Jasvinder Sondh, a sales executive of Reliance Digital Xpress located in Mumbai. "But the internal process is the same. It is still an invite based system."

Yogesh, a sales executive handling Lyf phones in a Reliance Digital store in Bangalore. "A customer can come to our store and we can provide the invite internally. This way he can buy the (Lyf) phone with Reliance Jio 4G."

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

Industry analysts have found Lyf handsets to be overpriced when compared to other brands' handsets with comparable hardware specifications. "RJio's LYF branded handset has much lower specification compared to similarly priced handsets in the market. Build quality of the handset is also not encouraging, especially in light of launch by Chinese players like Xiaomi, Le Eco, Oppo, etc," said Sandip Agarwal and Pranav Kshatriya of Edelweiss Securities Limited in a noted dated May 10. "Even Indian players like Micromax, Karbon, Intex, etc., offer much higher specifications at similar price points."

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