With scale, brands need efficiency, otherwise they will bleed: Vardhan Phadnis

e4m D2C Revolution Summit & Awards 2022: Vardhan Phadnis, Co-founder & Chief Sales Officer of Shoptimize, shared insights on algorithmic e-commerce

e4m by exchange4media Staff
Published: Aug 5, 2022 9:06 AM  | 3 min read
D2C session

At the inaugural edition of e4m D2C Revolution Summit & Awards 2022, Vardhan Phadnis, Co-founder & Chief Sales Officer, Shoptimize, shared insights on algorithmic e-commerce. 

Phadnis started off the keynote with stories of two brands which began from similar starting points and had similar journeys. One was a healthcare & nutrition brand while the other one was a fashion and apparel brand. 

Talking about the journey of the healthcare & nutrition company, he said the brand embarked on their D2C journey and got themselves a shopify website and decided to have a small three- member team. They hired some people to take care of their website, hired a digital marketer and one to handle e-commerce operations. Three months into the journey, they started scaling up, and started seeing good traction on the GMV front and hit a decent ROAS in three-four months. But they did not invest in any technology. For any D2C brand, GMV is non- negotiable. They hit that GMV, but complexity increased and data volume increased too. Later things started becoming difficult for them in terms of figuring out the data- what conclusions to drive. They were finding it difficult to keep up the scale, and in order to hit GMV numbers, they took certain decisions which were not fully cost-optimized. Hence, ROAS started declining. 

The brand in the apparel and fashion space did similar things with similar skill sets. India is a market where people want to try new brands, hence the D2C revolution, said Phadnis. “The brand too started seeing scale. However, in contrast to the first brand, the second brand owner had the vision that if they do not invest in the right tech and tools, the efficiency is going to hit. With scale, you need efficiency, otherwise they will bleed. The founder decided to invest in AI/ ML tools telling the brand what they need to do. In one year time, they hit their GMV number and also had stable ROAS.”  

Phadnis also drew an analogy between the stock market and e-commerce world. He explained how the stock market worked in the past.  “It was a broker-driven and manual interaction. Also, it was more on word-of-mouth stock tips. But now the stock market is filled with amazing tools available on your fingertips. Automated products are ruling the roost with millennials.”

Talking about the e-commerce world, he shared that a few years back it was manual in nature. “Data-driven decision making was not a very common phenomenon and again word of mouth growth tips were ruling the roost. Today, we have the right kind of technology and tools. We have AI and ML-based technologies for insights and recommendation. And that's how the world is going to be today and in the future. That is exactly algorithmic e-commerce.”   

 

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