Ola shifts direct-to-customer strategy, bets on multi-brand outlets, workshops

In a departure from its long-held direct-to-consumer sales model, India's largest electric two-wheeler maker Ola Electric is now turning to multi-brand outlets to expand reach and boost sales. The move marks the first time the company is partnering with external retailers, a decision that comes as sales from its own points of sale have not grown as expected.

On Thursday, Ola Electric said it has already signed up over 600 multi-brand retail outlets across the country, and plans to expand this to 1,000 ahead of the festive season.

According to two people aware of the details, the retail partners earn a commission from each sale, and will put down a deposit of ₹1 lakh per vehicle to secure a test drive two-wheeler. 

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The company plans to supply these outlets with test-drive vehicles to whip up demand, amid a broader push to tap into smaller markets and independent dealerships, hoping the strategy will provide a much-needed sales boost from areas where it has a limited footprint.

Ola Electric has products costing ₹70,000-1.34 lakh ex-showroom.

Ola calls the multi-brand dealer outlet strategy its Network Partner Program, as part of which it plans to enhance its sales and service network by onboarding 10,000 partners by the end of 2025. The initiative requires limited investments from partners, allowing for faster scalability compared to traditional dealership models, Ola said.

At present, Ola has nearly 800 company-operated experience centres.

In addition to expanding sales points, Ola is also adding certified partners and multi-brand workshops to address areas of weak service that have plagued customers, one of the two people cited above said.

Complaints have mounted to a staggering 80,000 a month and Ola has assembled a new service team to address the issue, Mint reported recently, highlighting the urgency for improved service processes as customers cite protracted delays. 

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However, the shift toward multi-brand retail comes with challenges. The model of leveraging smaller, multi-brand dealerships is seen by some as misaligned with Ola’s brand identity, which has previously emphasized a more premium, tech-driven image. “By moving to multi-brand outlets, Ola risks diluting this perception, making it harder to differentiate itself in an increasingly crowded EV market. Large established brands would typically like to control the customer journey and customer experience in showrooms”, a senior industry executive said, not wanting to be named.

Nikunj Sanghi, a former president of the Automotive Skills Development Council, expressed concerns about sales expansion without accompanying service infrastructure. While even conventional garages find it hard to service BS-6 compliant models, the struggle is worse for EV makers where even authorized dealers lack trained manpower, Sanghi said. He pointed to the dire need for trainers and training schedules, as Ola plans to expand to 1000 outlets in just 15 days. 

As of 24 September, Ola Electric's market share stood at 27.4%, down from 29.2% last year, indicating that incumbents like Bajaj Auto and TVS Motor are fast catching up. This decline comes as these traditional manufacturers scale up their electric offerings, intensifying the competition for Ola in the burgeoning EV space.

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As Ola continues to experiment with new distribution and service models, its ability to recapture and maintain a strong brand identity will be key to sustaining growth. Expanding through multi-brand outlets may help fill short-term gaps in sales, but the long-term impact on its image and customer loyalty remains to be seen.

Ola Electric appears to be aiming at high volumes; hence, it is focused on pricing to scale across form factors. In scooters, it has a range - from premium to mass-market with a higher emphasis on performance, superior design and advanced tech features. Critical areas of differentiation in the business model are high vertical integration, D2C distribution model and aggressive pricing supported by FAME/PLI subsidies.", a Bernstein report published on 20 September said.