 "Amarjit Singh Batra")
While the market is gradually opening up, running a secondhand goods website in India is tricky, Batra tells Abhilasha Ojha
Global studies show that online classified websites selling secondhand goods are catching up with consumers because they tend to increase the life span of a product. How does the Indian market appear to you?
The Indian market is quite different from other markets even though we have seen a tremendous response to our website. When we began our research, we found that there were many young consumers who were upgrading several products such as mobile phones within six months. What were they doing with their gadgets and other products? We also realised that buying from and selling to unknown people was a non-existent concept in India unlike in the West where online secondhand goods websites could have been spurred by the fact that consumers were used to the conventional "garage sales". Now with rising disposable incomes and with the market opening up, people want instant gratification by shopping regularly and upgrading to better products within months. As a company we have capitalised on this change in the market.
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Marketing and advertising for online retailers is still tricky given that some categories, such as secondhand goods websites, are still new to India. How can it be done correctly?
The aim of any advertising is to hit the target. Advertising in a category which is non-existent or new is trickier because there is no blueprint anywhere in the world for it and all markets have to be approached differently. In our case, we needed "hectic" communication with continuous advertising to let consumers know more about the site's offerings. But instead of going the conventional way, we decided to have an emotional connect and took a leaf out of the FMCG style of communication and advertising even though we are an internet company.
Typically e-tailing companies talk about themselves and how they are the best platform to shop etc. Our company strongly felt that we needed to connect differently; we went after households, we went after the young internet user - our potential consumer - through our advertisements. Taglines like 'Badee Baatein' (big talk), 'Ghar Baithey Paisey Kamao' (earn money sitting at home) spoke of how lives could qualitatively change with a simple exercise of selling used items. Our advertisements are now geared towards success stories of using OLX as a platform and many of these are consumers from affluent backgrounds.
OLX came under the scanner recently when a Brazilian woman decided to "sell" her baby on the website. How can companies avoid such instances of apparent misdemeanor?
Our maximum investment is in technology because we are constantly monitoring the conversation that happens online. That said there is no escaping such episodes. No matter how hard we try, we cannot escape the initial conversation that takes place on our site. However, companies can be nimble and 'reactive' to the 'action'. While we are a C2C company, we allow consumers to 'block' advertisements or entries that they consider offensive. That said, we are a facilitator, a platform but we don't post any of the advertisements ourselves. Even in the transactions, we allow consumers to directly deal with one another. The trick is in reacting appropriately and communicating that in no way the company endorses such views.
Talking of challenges, what are some of the challenges specific to websites dealing with secondhand goods? OLX stopped paid listings on its site recently; so clearly you are still learning through trial and error…
We still need market maturity and even globally companies are still in the process of discovering newer ways of doing business online. The biggest challenge for e-commerce companies is to bring new customers on their websites while also retaining the existing ones. Also no one really has a benchmark to decide successes and failures for business models online.
During our research we saw the typical SEC A and SEC B consumer wanting a platform to sell their goods. Our database shows profiles of many OLX consumers who have moved to a bigger metro for a job but don't want to spend lakhs setting up their homes. These people want to gradually move towards acquiring branded products and find it easier to come to our website first and later - if they still wish - go to other online or offline stores.
The other challenge for online companies is to adapt to the rapid changes in the internet landscape and making investments in mobile technology and adapting their websites to to different screen sizes. We realised that we needed a sound mobile app and today 62 per cent of our traffic is on mobile. We have seen people selling cars and bikes within 15 minutes of putting up the pictures and prices.
While it is good to have the first mover advantage, it can also serve as the perfect example for others to copy. How should a leader/first mover stay ahead of the curve?
At OLX, we do trend spotting through external and internal data. We are continuously conducting research to understand not just the users but also the non-users of the website: what they do on a daily basis, what they sell, why they sell and how they sell. An internal research showed that despite the earlier 'stigma' attached to wearing used clothes on the wedding day, many of our young consumers didn't mind buying branded outfits at a reduced price from another person who had worn it just once to his or her wedding. Think from a housewife's point of view who wants to actually sell one of the many outfits from her wedding? Think of an old branded lehenga being sold at a good price to a young lady who values it?
The research needs to be both macro and micro for business to start working online. Yes, there is opportunity for many more players but merely copying content doesn't help; market creation and the right thought integration is important.
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