Small businesses in competition with Google! Fighting war without fighting to win

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Updated: January 21, 2020 12:53 AM

The CEO of shares with Sushila Ravindranath how the company’s focus on expert service listings has pushed it headlong into competition with Google, and it is fighting a war without fighting to win. It aims to be the largest services marketplace brand for Indians all over the world.

satya prabhakar, sulekhaPortrait: Shyam Kumar Prasad

I have more or less met Satya Prabhakar, the CEO of—which is one of the earliest internet companies to come up in the country—every four years, when he has announced something new. Unlike many other such companies that got started around the same time, in 2007, Sulekha has survived, kept up with fast-changing technology, and emerged as one of the leaders in its space.

The company’s early-mover advantage began to fade with the arrival of specialised digital service players like Housejoy, UrbanClap, CarDekho, Ola, Amazon, Zomato and others, but Sulekha didn’t give up. It started reinventing itself. Today, is an AI-enabled platform for expert services. It has 73,000 paid service providers, and 2,05,000 unpaid service providers. All the paid service providers have recently successfully migrated from its platform to a dedicated business app; the company has a separate app for its consumers.

I am meeting Prabhakar to know about the changes he is making and how he is combating the competition for many of the service providers on his platform. We meet for an early morning breakfast at the Eco Cafe at Chamiers, a lifestyle store, as we always do. Chennai businessmen usually like meeting at the crack of dawn for breakfast, their favourite meal. Prabhakar orders a masala omelette with a lot of chillies, and I ask for French toast. We are also served fresh fruits and coffee.

Sulekha, when it was launched, was one of the most popular Indian internet media companies, connecting millions of Indians across 24 cities in India and the US. It integrated classifieds and yellow pages. At that point, it was also the largest online ticketer for Indian events and films in North America.

Although successful, it was a low-volume business, and not highly profitable. Prabhakar tweaked the business model several times. Sulekha then became a platform for trading products and services with classified advertisements. “We started focusing on small and medium scale businesses, which presented a huge potential.”

Prabhakar tells me what Sulekha is not doing. “There are fulfilment focused vertical solutions such as ordering cabs, food delivery or handymen providing either products or low-value services. Online information and payment systems like ticketing are low-volume commoditised businesses. C-to-C and ticketing services are online demand-supply brokers. We don’t compete in these areas.”

He says these are all high-frequency, need-based businesses. “Here, people are sensitive to price and you don’t have pricing power. You have to dominate your space to get attention. It is a global phenomenon.”

He sees Sulekha as the provider of market-based expert services. “It’s an intelligent matchmaker. There are MSMEs in the services space that do not have enough capital, enough business, no name recognition, no medium that will help them grow. They just don’t have an accountable and marketing-driven channel. Customers who need them don’t know whom to trust, don’t know how to choose, and they are under time pressure,” he says.
Small and medium businesses (SMBs), therefore, are ready for a digital disruption. That is where Sulekha comes in. As we get ourselves more coffee, he explains: “We address diverse needs across the hubs of home accommodation, business, events, training and lifestyle. We decided to focus on defined areas. Our customers’ requirements are matched with the services they need. For example, if you want an event manager, we find one specific to your needs.”

As we are about to finish our rather substantial breakfast, Prabhakar adds, “Business has to solve problems and people must pay for them. We have a value proposition for MSMEs to grow their business on our platform. They pay us, and it is not an expensive holding. We will tell them that they will get so much response. Sulekha provides verified matched service requests.”

On competition, he says the company’s focus on expert service listings has pushed it headlong into competition with Google. “In this case, we have to fight a war without fighting to win. We give differentiated higher value for the customer. You scratch a customer’s problem, an innovation is hiding. We give an accountable, actionable, simple solution. It is AI-driven matchmaking.”

Prabhakar adds the company has to move with the changes in mobile and digital technology. Sulekha’s business app provides several advantages to service providers. They can manage their Sulekha account from the app without having to speak with any customer support executive. They can decide the volume and size of the business leads they want, depending on their business capacity and bandwidth at any given time. They can also manage their profile page, which includes contacts.

Due to the feedback system, service providers can give feedback and receive insights that can help in improving their leads into conversion. Payments and renewals have been made easy. Service providers can choose Sulekha campaign packages and opt for a range of payment options, from the app.

“We get 10 lakh service requests per month. We match them in the cloud with the service provider. Since we moved all our service providers to the app, there has been a significant increase in the conversion rate of service requests. This is due to rising smartphone penetration and greater uptake for business apps in metro cities as well as in tier-2 and tier-3 cities, amongst smaller businesses. In fact, 98% of paid service providers in the metros are using the app, and 93% in smaller cities,” he adds.

As a result of all the paid service providers moving onto Sulekha’s business app, there has been a surge in the number of paid service providers on Sulekha, a 30% increase was seen last year. “This move is in alignment with Sulekha’s core philosophy of helping small businesses grow. We believe that digitally-engaged service providers are more likely to convert service requests,” says Prabhakar.

He adds the company is not starved of opportunities. “We have to build scalable, reliable, digitally-deliverable models. We want to be the largest services marketplace brand for Indians all over the world. Moving forward constantly gives you continuous low-burn anxiety,” he says as we finish our coffee.

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