When the four founding team members from HealthcareMagic were planning their exit — post its acquisition by a US-based company for a valuation of over 100 Cr, faced the question ‘what next?’. They realised that they wanted to build something that actually had a big impact on Indian society.
At the time, social media was witnessing a massive jump in users as well as a way for businesses to sell. Looking to tap this opportunity, Sonal Verma (MBBS, MD) — who was the founder of HealthcareMagic — decided to drive her passion towards helping women become financially empowered. So Verma, along with Kunal Sinha, Nitesh Pant, Shekhar Sahu, and Nilesh Padariya founded GlowRoad.
With the goal to solve the problems faced by micro-entrepreneurs, and provide them with more opportunity and a platform to earn from home, GlowRoad was formally incorporated in 2017.
The social commerce sector, which is currently pegged to be a $2 Bn market, is growing majorly due to millions of small retailers leveraging the reach and impact of social media to grow their business. While the exponential growth has attracted many tech giants such as TikTok (before the ban), Facebook, Instagram, Google and others, GlowRoad and other startups are also making a big difference by solving unique problems in the social ecommerce value chain.
Elaborating on what sets GlowRoad apart in this highly competitive field, cofounder Verma said, “We provide resellers with access to trusted suppliers, logistic services, and payment gateway. We want them to have long-term sustainable businesses, this means curating products in terms of quality, designs, and the product mix itself. We also offer a very simple free personal online storefront to our resellers, so as they grow they can use digital marketing to expand their business.”
The startup claims to have over 10 Mn registered members, and enable lakhs of resellers to earn money every month. It is working with all major logistics service providers to solve the challenge of deliveries and returns; delivering products in more than 23K postal codes, primarily in Tier 2 and 3 cities.
A Deep Dive Into GlowRoad
Building a platform to help micro-entrepreneurs earn from home is a challenging task in India, especially considering the many scams that run under the name of ‘earn from home’.
“We tried our best to be easily approachable to anyone wondering who we were. Thankfully, we had a proven track record as entrepreneurs, which increased the confidence level of both suppliers and resellers,” added Verma.
Another major hurdle for the startup in its initial days was sorting out logistics partnerships and processes, which took a lot of iterations. Today, it is enabling the resellers by not having to keep physical inventory and thus, zero capital to start a business. “We use a lot of AI to help resellers get maximum output in minimum time. For the same amount of time invested, a reseller makes more on GlowRoad than on any other reselling platform, which reflects in our excellent retention rate,” said Sahu.
While the first two months of lockdown affected the startup adversely, it partnered with edtech companies and telemedicine products, which helped it stay relevant in the market. This is a flexibility that social commerce offers startups. As the market evolves, the products and offerings on the platform also have to be tailored. During the lockdown, the startup shuffled its focus to the ‘stay at home’ lifestyle to ensure that resellers have relevant products to offer.
Sahu told Inc42 this meant more products in the home fashion, cookware, healthcare and personal care categories and targetting sellers that do the best job with these categories. “The best part is that our unit economics have become much better. We would most likely be the first profitably growing social commerce company in India,” added the cofounder.
Considering the fact that resellers are more concerned with product quality, delivery, ease of returns and refunds, timely margin payment and more, the startup said that it made deliberate efforts to meet their expectations on all these parameters.
The next big challenge was the supply chain. Suppliers that were new to ecommerce needed training and regular communication. So the company worked closely with the suppliers to help understand customer requirements, identify causes for returns, and take corrective measures.
Verma further added, “From the beginning we have focussed heavily on building smart solutions for our suppliers to manage orders and inventories using our platform. Additionally, we are the only platform to offer resellers with an online digital shop in a click of a button which they can share with their buyers and bring more customers, growing their business multifold.”
Future Outlook For Social Commerce And GlowRoad
While the growth of ecommerce in India is no longer news to anyone, in a matter of just 10 years, the social ecommerce market is expected to be twice the current size of ecommerce. The sector is expected to reach $20 Bn by 2025 and nearly $70 Bn by 2030. This presents startups such as GlowRoad and others of its kind, a big opportunity to tap into.
Talking about the industry in India, Pant said, “If we talk very specifically about social commerce, we are still in early stages. Many more ways of social commerce are flourishing in China, so first, those need to be tried in India. Also, platforms that provide tools and services for resellers to help reseller scale-up are required.”
The startup believes that though the segment has seen incredible growth and some remarkable companies, there still exists a huge untapped market, which makes it easier for multiple players to co-exist. Success here is determined by the one with the most retention and capital efficiency as acquiring users and sellers becomes more and more expensive through cashburn.
GlowRoad is looking to consolidate and streamline the various product categories in fashion, home and electronics in the coming six months for a more sustainable approach in reaching customers.
Beyond the growth opportunity, lately, there has been another grave concern for the social commerce segment. There could be regulatory hurdles in the future given the rising incidents of multi-level marketing, fake goods and spam pages.
But Verma claimed GlowRoad’s model tackles such illicit activities, “GlowRoad works on a single layer of resellers unlike the typical pyramid structure based multi-level marketing companies.”
She further added, “Our resellers don’t need to recruit people under them. We have entirely stayed away from anything that might look like multi-level marketing, which is the biggest regulatory hurdle in the reselling space. Same way, we have stayed away from coaxing suppliers into exclusivity. Current regulations are by and large favorable for the industry and it should help in growth.”