Thousands Of Women Are Running Virtual Storefronts In Indonesia
Startup Slingshot MindStores combines a direct-selling business model and AR to empower small business owners
Often referred to as “Lipstick Evangelism,” the direct-selling model used by giants like Avon or Tupperware has proven successful in empowering women in LEDCs by offering them low-risk opportunities to generate income. Indonesia-based startup Slingshot MindStores is set to bring this concept into the world of VR and AR by launching 3D virtual storefronts in partnership with Alfamart, one of the country’s biggest retailers.
Branded as ALFAMIND, the solution offers a new shopping experience in which customers can browse the shop as if they were in the actual physicals space, by using a tablet or a smartphone.
Through micro-franchise agreements, anyone can apply to launch the virtual storefront and gain access to thousands of products ranging from apparels, cosmetics or home decorations.
With more than 5,000 stores opening in Indonesia in six months, the network has seen more than 150 percent month-over-month growth, with the potential to offer more than 4,000,000 new stores in Indonesia over the next two years.
For the initial free of approximately $100, which can be then used as shopping credits, the storeowners, of whom 98 percent are women, order products from the inventory list and receive payment in cash from their customers. The nation-wide shipping is handled by Alfamart, thus eliminating the need to handle any logistics. The storeowners receive a 15 percent cut on profits from most of the Alfamart’s product categories, with MindStores taking 2 percent and the rest going to the retailer. According to Slingshot’s reports, the participants make on average $900–$1,200 per month in sales.
ALFAMIND is particularly popular among women with children who need an extra stream of income and who appreciate the flexible hours. The majority of the sales take place in the seller’s social circle, including family members, neighbors or other people they interact with on a daily basis, however some more entrepreneurially inclined storeowners tap into the potential of social media to expand their reach.
The AR component of ALFAMIND enriches the shopper’s experience, but it also posses some technological challenges. Even though the smartphone penetration rate is high in emerging markets like Indonesia, the devices usually run on processors two or three generations old, which causes a challenge in rendering animations in AR and VR. The company solved this issue by building the stores with their own engine, making the minimum hardware requirements more obtainable—quad-core 1.8 GHz CPU, and 2 GB RAM. The app also allows for offline browsing, though internet connection is necessary to place orders.
Mindstores wants to eventually allow store owners to sell their own merchandise and crafts—think Etsy in AR, in addition to bringing more well-established partners on board.