{"id":5531,"date":"2019-07-18T07:05:00","date_gmt":"2019-07-18T07:05:00","guid":{"rendered":"https:\/\/www.thirdeyesight.in\/?p=5531"},"modified":"2022-11-11T07:09:28","modified_gmt":"2022-11-11T07:09:28","slug":"how-kunal-bahls-snapdeal-is-finding-its-lost-mojo","status":"publish","type":"post","link":"https:\/\/myechoproject.com\/TES\/how-kunal-bahls-snapdeal-is-finding-its-lost-mojo\/","title":{"rendered":"How Kunal Bahl\u2019s Snapdeal is finding its lost mojo"},"content":{"rendered":"\n

Ratan Tata-backed Snapdeal having lost steam after its merger with Flipkart was called off while Amazon too had displaced it as among the leading e-commerce company apart from Flipkart is now steadily regaining its lost ground but in a new avatar.<\/p>\n\n

Written By Sandeep Soni<\/p>\n\n

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Around August 2017, Snapdeal had called off Flipkart\u2019s offer of buying it out for $850 million, down from $6.5-billion valuation it had in early 2016. Snapdeal\u2019s sales had plunged, products count has also gone south even as Amazon had displaced it to become the new formidable competitor to Flipkart\u2019s stronghold in the Indian e-commerce sector. The ecosystem had almost written it off with media reports narrating the fall. More than two years after the company\u2019s founders Kunal Bahl, Rohit Bansal decided to battle it out on their own with a renewed Snapdeal 2.0 focusing on its core business of online retail, the lost mojo is coming back for Bahl and Bansal.<\/p>\n\n

\u201cThe inflection point in Snapdeal\u2019s journey was when they stepped back from the cut-throat competition that was happening between them, Amazon, and Flipkart in 2017. Snapdeal took that decision when they had little cash in the bank. It was a hard time to take that decision because any other alternative strategy would have also needed capital. So they took that decision to focus on core business,\u201d Devangshu Dutta, CEO at retail consultancy Third Eyesight told Financial Express Online.<\/p>\n<\/div><\/div>\n\n

Snapdeal\u2019s revenue grew by 73 per cent year-on-year from Rs 536 crore in FY18 to Rs 925 crore in FY19 even as losses shrunk by 70 per cent from Rs 611 crore to Rs 186 crore, Kunal Bahl said in a LinkedIn post as part of the company\u2019s audited financial results for FY19. Snapdeal\u2019s traffic went up 2.3X to 70 million unique users per month. But what led to Snapdeal\u2019s founding that lost zing back? There are a couple of factors.<\/p>\n\n

Capturing value-conscious Buyers<\/b><\/p>\n\n

Kunal Bahl in one his blog last year had said that the company would focus on the value-conscious buyers \u2014 around 400 million that are still at an early stage of discovering and buying goods online. This lot doesn\u2019t speak fluent English, less disposable income, lives beyond metro and tier-I cities and are not brand conscious. \u201cGiven their vast numbers, the supply of value-priced selection is growing online exponentially \u2013 mirroring the selection found in the bazaars of India. This is a market worth nearly $163 billion and only about 1-2% of this is online,\u201d Kunal Bahl said in the blog. <\/p>\n\n

\u201cIt is a shift from discounts to value. Snapdeal is trying to get customers\u2019 mind off the price element. If you are looking at a product\u2019s price, you are looking at it as a commodity. If you are looking at it as a commodity then you are looking at the like-for-like comparison and going for the lowest price,\u201d added Dutta. This echoed with Kunal Bahl\u2019s focus for next year. \u201cWe are not aiming for triple-digit growth rates,\u201d said as he believed that \u201cconsistently compounding revenue growth create large and valuable enterprises.\u201d<\/p>\n\n

Rebuilding Seller Base<\/b><\/p>\n\n

Snapdeal has been able to grow its listings to 200 million with 50 million listings coming in the last two years with more than 60,000 new sellers even as it uses artificial intelligence and machine learning to help its sellers aware of new trends and gaps in the product-pricing mix unlike \u201csome other marketplaces use these interventions to promote their private labels or favourably position their proxy sellers,\u201d Bahl said. For example, Snapdeal\u2019s machine learning-based smart courier allocation tool analyses \u201cthe first-mile decision (pick-up) with a last-mile decision (delivery) identifying the partner(s) who can deliver the shipment in the most efficient manner.\u201d \u201cThis is certainly a factor for their growth because if you are playing a pure marketplace game then sellers are relatively more comfortable because you are not a competitor to them,\u201d said Dutta.<\/p>\n\n

Tech Shift<\/b><\/p>\n\n

Not just on the seller end, AI has become integral to Snapdeal\u2019s efforts of ensuring that its no-frills customers can come across products that they want to buy \u2014 affordable and unbranded. AI helps in optimising catalogue and enhancing search based on which the customer is offered personalised and relevant products more than just top deals of the day or top discounts or top-selling items. Snapdeal has also created multiple short videos on the functionality of products for customers to understand them.<\/p>\n\n

\u201cClearly at one point Snapdeal realised that investors are backing away from investing more money into them because the sense then was that Amazon would take over the market. You need really deep pockets to acquire market share if you are losing money on every dollar earned. However, e-commerce is at a nascent stage and we shouldn\u2019t deal with it as if it is a short window of opportunity that is closing,\u201d Dutta said. Moreover Snapdeal has been constantly engaging with its customers in their offices by inviting them to understand one-ono-one about how they shop and what they shop.<\/p>\n\n

Source: financialexpress<\/a><\/p>\n\n\n\n","protected":false},"excerpt":{"rendered":"

Ratan Tata-backed Snapdeal having lost steam after its merger with Flipkart was called off while Amazon too had displaced it as among the leading e-commerce company apart from Flipkart is now steadily regaining its lost ground but in a new avatar. 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