OTP Please: Online Buyers, Sellers and Gig Workers in South Asia 
By Vandana Vasudevan
Penguin, 384 pages, Rs 499

A cab in five. Biryani in twenty. Groceries in ten. But behind every tap and scroll, who really pays the price for convenience?

Vandana Vasudevan’s ‘OTP Please’ dives deep into South Asia’s app economy, spanning India, Pakistan, Bangladesh and Nepal, to uncover the precarious, invisible lives that make our digital ease possible. Gig workers racing against time. Small sellers lost in algorithms. Platforms that rule without responsibility. Rigorously reported, empathetically told and disturbingly familiar, this is the book that will make you pause before your next 'Order Now'.

Here is an excerpt from the book:

How Do I Exploit Thee? Let Me Count the Ways

Sellers are constantly wary of the immense asymmetry of power that the platform has because of its hold over the main currency of the business: data. Ownership of all transaction data gives the company real-time information on consumers’ shopping behaviour, who likes what, which product is hot or not and all other key details of the shopper’s journey. With this information and its endlessly deep pockets, it can quickly experiment and recreate a product that it knows is popular and highly rated. These products are then sold under the platform’s own brand name at lower prices than the popular one. Buyers don’t realize that it is able to sell at a lower price because it doesn’t pay any commission unlike the third-party seller who pays about 20–25 per cent per transaction. 

In 2021, Reuters published an expose that revealed that Amazon was running a systematic campaign of creating cheap rip-offs of other people’s bestsellers but also manipulating search results to boost its own brands (Vedaka, Solimo, etc.) in India, one of the company’s most important growth markets. 

Paul Chacko, in Kottayam, Kerala is a small seller of spices, honey, pickles and other organic food products on Amazon. Most of his sales come from Amazon but not without several pain points. 

‘Selling on Amazon is a kind of trap,’ he tells me on phone. ‘Because they decide how much sales they want to give you, not the customers.’ 

In the beginning, everything was going well for him. He was selling 100 kg of green cardamoms every month when the price of cardamom was 2000 per kg. In anticipation of a good quarter, he stocked up 300 kg. Then, suddenly, his sales dropped. The stocks got fungus and had to be thrown away. 

‘You see, Amazon also sells green cardamoms under the brand name Vedaka. They know what the demand is for my product and who the customers are. When they see my brand doing very well, they then suppress it and show their brand to customers looking for green cardamom. When my sales dropped, they approached me to hire their account manager to boost sales.’ 

I ask him why he doesn’t walk away from Amazon and sell through his own website. 

‘Because, like I told you, it’s a trap. You cannot not be there . . .’ he replies.

Unfair returns policy
Giridhar Soundararajan is a passion-preneur in Bengaluru who converted his fascination for high-performance motorsports to his profession by founding Barrel Electric, building the country’s first electric dual sport motorcycle. Before that, he founded Barrel Exhaust in 2014, which makes automotive parts and has a loyal clientele in the biker community. Like other SMEs, Giridhar got on to Amazon and Flipkart in 2017, drawn by their immense reach, since anyone who wants to buy first searches for the product on these platforms. 

In four years, he was out of there. 

‘When I list a product, a customer anywhere can order it for cash on delivery. Our products are a little premium, and we are an SME, not a huge brand. For us, the stock is critical. Our inventory is not extensive, so we play around with our working capital. When someone places a cash-on-delivery order, the buyer does not commit to the purchase. Sometimes, the address is wrong or the customer will say, sorry, I am not in town. Sometimes, just by looking at an address, we know this guy can’t be a serious buyer of our product. When we used to raise it with Amazon, we would get an auto-generated response that the address is verified, so please ship the product.’

‘80 per cent of cash on delivery orders were invariably cancelled. Okay, granted that the customer is king, and it is their platform, they can make whatever rules they want. But it is my product! After the customer declined it, it would take thirty days to return it to us! So if ten such products were shipped, imagine eight of them getting returned and missing from our inventory for a month! The value of each exhaust system was about 20k, so that’s about 1.6 lakh worth of goods just tied up. Sellers like us had to suffer only because Amazon has random customers abusing its customer-centric policy, and it doesn’t want to do anything about it.’ 

This is only part of the returns saga that Giridhar faced. Some customers would pay and accept the product only to return it in a week. 

Exhaust for motorbikes, once fitted, cannot be resold because once someone fits it into the vehicle and takes the bike for a spin, the carbon deposits on it will ensure it never looks new again. Ideally, they should be classified as non-returnable, like for example, undergarments are. However, sellers do not have a say in whether their products were returnable and whether they could opt out of cash-on-delivery. Once a category is chosen, the seller has to follow the template in which these parameters are pre-fixed. There is zero room for negotiation. 

When the customers returned the product in a week, and Amazon finally sent it to Barrel Exhaust’s office, there was a high probability of damage. Giridhar shares photos of the original fan stem, silencer, shock absorber and the ones he got after the customer returned them to show the difference. 

‘Either the customer is keeping a 20k item with him and returning a 2k one. Or someone in the warehouse is stealing the originals and sending us damaged stuff,’ he says. In his experience, Flipkart was even worse as they had even more non-serious buyers who were fooling around with sellers, and a lot more pilferage happened during the logistics. 

When Giridhar and his team would complain that the returned item was damaged, there would be no human being to speak to as usual. A ‘safety claim’ had to be raised in the seller’s section of the website. In the few years that Barrel Exhaust was selling through Amazon, Giridhar recalls raising thirty to forty such safety claims—uploading photos and filling in all the information every time. Here’s the clincher: after doing all this, Amazon would decide how much the damage was worth and how much compensation the seller deserves. 

‘If my product is worth 20k. And they decide that damage is worth 4k. They’d only repay me 16k. So because of them not having good-quality customers, my product is returned; they hold my inventory for thirty days, it comes back damaged and when I make a claim, the value of the loss is decided by them!’ says Giridhar, in disbelief despite the incidents happening a few years ago. 

Eventually, Giridhar and his team decided the ‘reach’ was illusory, and they would rather sell to genuine customers through their website. 

Despite these obstacles, did he make a net profitthrough the platforms?

‘On Flipkart, I made nothing. We were getting awful customers. On Amazon, I made about a 10–15 per cent margin. If I sell the same thing offline through my old website, I make 35–40 per cent.’ 

Giridhar found it hard to understand the calculations of what they finally received for their sales on Amazon, after the commission deductions, fee for warehouse and logistics and other mysterious levies that he terms ‘the best kept secret after the formula for Coca-Cola’. Big retailers hire consultants just to be able to understand Amazon’s transactions,’ he finishes.

[The excerpt reproduced with the permission of the publishers. Footnotes in the original, supporting the contents, have not been included here.]