Snapdeal unveils app-only marketplace ‘Shopo’, targets 1 million SMBs within 1 year
It looks like mobile-focused marketplace is the new buzzword. From ecommerce players turning to app-only mode to launching fresh platforms with app-only interfaces, it seems all predictions about a mobile-ward move are coming true. After Paytm, Snapdeal has launched a new app-only platform called Shopo—a zero-commission marketplace which lets sellers register for free and interact with buyers via chat messages.
Monetizing a 2-year old acquisition
Snapdeal had acquired Shopo in mid-2013 for an undisclosed amount.
Businesses can now list their products on Shopo without submitting any document and long verification procedures and reach out to customers without paying Snapdeal any commission for the sale.
“We have launched Shopo, a mobile-based open marketplace that will allow businesses as well as individuals to harness the power of Internet instantly and at zero cost. The aim is to bring one million such entities on the Shopo platform in the next one year and help them become a part of India’s digital commerce ecosystem,” Snapdeal Co-founder and CEO Kunal Bahl said.
The application is currently available on Android and Apple’s iOS platform.
“Currently less than 0.1 per cent of small and medium businesses in India have online presence. Shopo aims to build a platform to help millions of small businesses, home entrepreneurs, artisans and individual sellers set up their online shop in the most convenient way,” Bahl said.
Snapdeal claims 150,000 sellers on its site which is three times more than nearest rival Flipkart.
The company claims it has hosted over 30,000 listings in the last month while they've been testing the platform, with a new listing getting added every five seconds.
Marketing and revenue model
Asked about the marketing and revenue models, Bahl said the company is currently focussing on bringing more businesses on board. “This is just the beginning. SMBs work mostly on a word-of-mouth system, and we are banking on that for the time being. We have all tools required to enable revenue-generation, and will implement them as and when required,” he pointed out.
Sandeep Komaravelly, Senior Vice President, Shopo said, “The ecommerce space is evolving at a fast pace in India and the industry is moving towards open and free models of ecommerce. Shopo aims to build a platform to help millions of small businesses, home entrepreneurs, artisans, individual sellers set up their online shop in the most convenient way and grow their business.”
“So much e-commerce is happening on WhatsApp already in India to give an example. Our aim with Shopo is to formalise that e-commerce that has anyway started happening,” pointed out Bahl. The Shopo app will let a buyer and seller chat with each other, a buyer can make a bid on the price as well and a seller has the option of rejecting or accepting the bid. Once a sale is confirmed, delivery point has to be decided between the seller and buyer themselves and the app allows both parties to share location, contact number as well.
The app’s categories are ‘hand-picked’ by the Shopo team and buyers can also rate sellers. When asked how Snapdeal would ensure that sellers who deliver sub-standard products are kept out, the company’s execs said that sellers with lower ratings would get pushed further down.
“We will have a system of checks and balances,” said Bahl though he did not elaborate on how the company would deal with sellers who didn’t live up to promises. “Legal systems will be in place. However, legal accountability will rest with the seller,” he added.
When asked about the revenue model with Shopo, the company said for now it was a no-commission app and that they were focusing on the service and product.
When asked if the company is looking at an app-only transition, Anand Chandrasekharan, Chief Product Officer at Snapdeal, said, “Users should be able to consume an experience however they want to consume it. It's important that these decisions are made in the real world, not in some echo chamber. I've had conversations with so many of my family members who have done entire months of shopping without downloading the app. Also, in India, you have a huge problem with memory on smartphones. The biggest source of uninstalls is due to limited memory. In that kind of a world, to mandate that your app must always be on the phone is in our opinion inconveniencing the user. From our perspective, we'd rather inconvenience our employers than our users.”
Our typical marketing budget is usually 10 per cent of the topline spend