 "NDTV steps up focus on start-ups")
The company has started four e-commerce websites across categories like automobile, gadgets, health foods and wedding preparations. Each of the four portals has been founded under a separate company, where NDTV Group maintains majority stake.
It has also acquired online ethnic wear portal indiaroots.com in 2013.
Vikram Chandra, group CEO, NDTV, says, “We have identified three pillars of business at NDTV. While television is our core, the other two focus areas are online and the digital start-ups or the e-commerce business. We have a strong presence on digital, including mobile, and the e-commerce vertical draws from this. It operates on three C’s – content, community and commerce.”
He adds that the reason for starting them under separate companies was to provide flexibility in shareholding and ease raising investments. The wedding portal bandbaaja.com has already raised funds from CerraCap Ventures at a valuation of $20 million, while smartcooky.com has raised funds from Vandana Luthra (VLCC Health Care Limited), Rajan Anandan (Google), Manvinder Singh Banga (ex-Unilever), Pramod Bhasin (ex-Genpact), Mohandas Pai (Manipal Global Education Services) and Aarin Capital at a valuation of $12 million. Gadgets 360 has already raised funds at a valuation of $50 million, while the auto portal has raised money at a valuation of $30 million, taking the total valuation for the four digital start-ups to $112 million.
NDTV operates three news channels— NDTV 24x7, NDTV India and NDTV Profit/Prime. As is known, news channels depend heavily on current affairs for advertising revenues and follow a cyclical pattern in attracting advertising.
However, that was a short-lived adventure, as the channel shut shop four years later. It also runs the infotainment and lifestyle channel NDTV Good Times.
A smaller bouquet of channels also means less leverage while distributing them.
Digitally however, the Group’s assets have done well, with the NDTV portal and app being the number one digital news asset, way ahead of its peers. So, it makes sense for NDTV to make moves towards diversifying online, keeping content as core in its strategy.
All the portals were first launched as content bases on their respective fields. Over time, communities were formed on the same, which were then used to drive transactions for the related products.
Chandra explains that one of the biggest challenges for e-commerce start-ups is getting visitors. Having already formed a community, the portals have a ready consumer base, specifically those interested in the topic which makes it easier to push sales.
“What we are doing as a group is incubating start-ups and providing them a launch pad. Not only do these curated online communities provide a consumer base to drive transactions, it also gives our partners on the portals a marketing platform. Any product going on sale on the portals can be flash across the NDTV channels. This way, the products get good visibility on a medium that is otherwise very expensive to advertise on,” adds Chandra.
He knows things will not come easy in the e-commerce business, and that there will be a phase for investment before the start-ups can make money. However, given the structure of the company, NDTV has hedged the risk as best possible and Chandra hopes to identify more areas to launch digital start-ups in the future. The company is already looking at areas like art and property, but nothing has been formalised yet.
