‘Psychedelic Warzone: Shoot It Out with a Burst of Colors! Starting Rs499 for Paintball and Hookah for Two OR Four People at Shootout Zone, Andheri Modh.’ This and many more niche daily deal offers flash regularly on Crazeal?s (the Indian unit of Groupon) website. Apparently, the company is a late entrant in India?s coupon website space ruled by local players such as Snapdeal and Mydala. But Ankur Warikoo, CEO, Groupon India is confident about making a dent in this category with niche offerings for Indian online shoppers. In an interview with Rohit Nautiyal of FE, Warikoo talks about Crazeal?s vision for India, the importance of right merchant and content partnerships and his competitors. Edited excerpts.
You are a late entrant in India?s daily deals space dominated by local players such as Snapdeal and Mydala. Considering that Groupon is the mother of all coupon websites in many markets globally, how do you plan to take on the Indian players?
We have been through a series of jumps in a short time span. This started with the acquisition of SoSasta in January last year followed by our rebranding as Crazeal (a tweaked word for crazy deals) in early November. Globally, daily deals models have no entry barriers and anyone with as little as a day?s homework can start a company. Business offering and positioning become key differentiators in this category. According to the latest Comscore data, we are number three in coupons websites.
We choose to invest in partnerships that bring value. For instance, in India, we have entered into a content partnership with eBay, which is undoubtedly one of the leaders in selling products online but services and travel experience was missing from their portfolio. While Groupon will service travel and local services customers in all the cities and have access to a large chunk of audience transacting online, eBay gets access to our content. This will work wonders for us in terms of visibility. In the last quarter, our traffic has increased by 84%.
In that case, what is responsible for the high traffic on Crazeal as you claim?
Deals are our only hero. While we cannot share country specific numbers, Groupon?s global subscriber base is 150 million plus. In India, we are focusing on three categories. One is travel where we work as a marketing channel for hotels and tour operators. Second is the plain Jane products category including a good mix of all types of services, with the third category being local services such as food and beverages and wellness ? the bread and butter of Groupon. We are not going to get into price wars by selling more electronic products, mobile phones or pen drives. Crazeal is all about impulse driven purchases. For instance, around Valentine?s Day we had gold-plated roses on offer which had many takers. Or as part of a tie-up with Deccan Aviation in Bangalore, we offered a 10-minute flight over the city. A similar activity was done on the last day of Ganesh Utsav in Mumbai. While we are present across 17 cities in India, in January we processed orders across 78 cities.
Are there enough takers for niche offerings? Don’t you think that the price sensitive Indian who?s still cutting her teeth on online shopping may feel alienated if you do not push the conventional categories?
While such offerings may not help us grow in terms of numbers, it will certainly help in building our brand equity. We would like to call ourselves a lifestyle discovery engine. Right now, 60% of our sales come from six metros with 45% of repeat purchase within 60 days. Crazeal also has one of the highest transaction value per order of Rs 1300 onwards. The e-commerce space has been loaded with lots of institutional money and the growth pressure rises with each day. And so consolidation is the next step.
You and Mydala are the only two players who have stayed away from TV advertising so far. What is your media plan?
Crazeal has stayed away from using mass media marketing. We spend a lot of money in branding ourselves online. Social media plays a huge role in our media mix as it allows consumer engagement. Besides, we dabble in radio, print and corporate activations as and when required. Crazeal will do television when the time is right.
As a leader of Groupon?s delayed Indian foray, how do you look at your competitors?
While I have respect for some players in the daily deals space, many are mediocre. For me, the competition is Groupon Thailand, Malaysia and China. India has witnessed a huge growth in e-commerce in the past one and a half years and customers online have been bombarded with innumerable offerings. Sadly, the successive steps of customer evolution have been constantly bypassed. India became too crowded too soon and has been moulded into a discount deal chasing set-up where merchants do not really understand how their businesses can benefit. The main objective of our channel is marketing. From day one, we have focused on having the right set of merchants on board. We start with city planning, doing merchant reviews followed by personal visits to experience what the merchant has to offer before closing the partnership deal eventually.