India’s first managed marketplace, Shopclues recently completed two years of existence. The company went through numerous ups and down in these two years. Whether it is the case of one of its co-founder being under FBI scanner or company raising funding rounds back to back, Shopclues managed to be in the news for the past two years.
Currently, Shopclues is doing over 3 lakh transactions a month, and will exit 2013-14 with much higher run rate versus the Rs.350 Cr goal outlined one year back.
Recently the online marketplace had also launched an Android App for its store, but to mention this wasn’t the first mobile app from the company, but the third one. The other two apps include – an app used by pickup boys during Milkrun and the other by merchants, so they can manage their online store anytime, anywhere.
The App features its complete catalogue of products, order history, search and filters. Apart from these similar features as on the website, the App has dedicated deals for App section – which includes exclusive deals for mobile App users. The App offers multiple payment options including Credit Card, Debit Card, Net banking, Cash Card and COD.
We caught up with Radhika Ghai Aggarwal, Chief Marketing Officer & Co-founder, ShopClues.com to know more about the current scenario, future targets and plans for the company.[Edited Excerpts]
Inc42: What are your targets for this year?
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Radhika: We are eyeing 1 Cr orders and +300 Mn visitors for 2014-15.
Inc42: Till now Shopclues had raised over $15 Mn in venture funding, how have you allocated these funds?
Radhika: We have focused on leveraging in-house technology for building its processes. And all along, we have been cautions about not guzzling the funds, we have used these funds cautiously to scale the business, increase the product catalog and expand the reach of its fulfillment network, as well as strengthen the technology platform.
Inc42: What steps have you taken for bringing more customers on the platform? How much customer acquisition cost you are incurring?
Radhika: We not only have the lowest customer acquisition cost in the industry, but perhaps the best cohort for any e-Commerce company in India. So while Shopclues is attracting new customers every month, it invests effort in building customer loyalty.
An analysis of ShopClues’ customer data every month reveals that nearly 60% are repeat buyers with a steadily growing basket-size. Also, over 30% of first-time customers who shop on the site during deals and promotions return to purchase even non-deal items.
Because of our highly ROI-focused approach to marketing, we will likely to start generating positive operating margin much earlier than our competitors – possibly, as early as the first quarter of 2015.
Inc42: Shopclues, by now, is not spending on mass media campaigns, any plans to start with it? What are the company’s plans for marketing this year?
Radhika: We have maintained a tight control on operations and marketing costs, and to mention we rank between 57-60 on Alexa, without making investing in mass media campaigns. For now we will maintain this trend of being away from any kind of mass media campaigns or ATL activities, and will continue with a strong focus on social media.
Inc42: Can you share some trends on Shopclues in regards to type of mode of payment used by the customers?
Radhika: In a market where cash-on-delivery is the popular mode of payment, we promotes pre-paid shopping. According to the recent survey by IAMAI, 59% of the 3,480 respondents used credit cards to shop online and 28% used debit cards while 40% paid cash on delivery, whereas at our platform, nearly 90% of the orders are pre-paid by customers.
Inc42: How many merchants are currently registered on Shopclues? (Products and categories).
Radhika: There are over 32k registered merchants, attracting over 10 Mn visitors accessing the site every month to shop. We have around +3.5 Mn products across 2000 listing categories with listed merchandise value in the range of Rs.20,000.
“Shopclues has grown 600 per cent over last year in an industry that is clocking 150 – 200 per cent year-on-year growth as per ComScore reports, looking at the trend Shopclues is confident to be a fully profitable ecommerce player in the country by 2014-15.”
“We are not only seeing revenue growth acceleration but also our margins are improving rapidly”, says Sanjay Sethi, CEO & Co-Founder. “We believe we have the lowest cash-burn rate for any e-commerce company of our size and our business model, culture of frugality, obsession with data and analytics, and high operating leverage are giving us a clearly visible path to profitability,“ he added.