BuyThePrice.com, an e-commerce site owned and operated by MyZingo eCommerce Service Pvt Ltd, has completely changed its business model from being a pure e-commerce site to a 100 per cent marketplace.
The Hyderabad-based startup was founded in December 2009 by Ranjith Boyanapalli (CEO), Tharachand Surydevara (VP-Operations) and Jagdish Kothapalle. Boyanapalli, IIM-Indore alumnus, has earlier worked at companies like Infosys, CSC, and eYantra. Suryadevara holds an M.Tech degree in Geotechnical Engineering from IIT-Bombay and has worked with Infosys, Applogics Inc. and Polaris Software Lab. Prior to BuyThePrice, Kothapalle has worked with Tata Consultancy Services and Infosys.
The company had earlier started off as an e-commerce site for consumer electronics and appliances, but later added a number of categories to its offerings.
The site has now become a marketplace, which basically means that the company does not hold inventory anymore. Instead, it has sellers on the site that are offering the products to the end consumer. A post on the site reads, "We have changed from 'selling multiple products to consumers' to 'connecting large number of sellers and their offers to consumers'.
"In the last 2-3 years, there has been an e-commerce boom in India, due to factors like high internet penetration, better courier services, better payment systems and consumer acceptance of e-com. This has triggered enormous supply maturity, in other words, a lot of sellers across the country that had been in the physical retailing business now want to expand online. So, we asked ourselves, do we build a parallel to physical retail (which costs a hell lot of money), or power the physical retailers by offering them a marketplace. We chose the latter," said Boyanapalli.
"It has actually been close to a year since we held any inventory. We had started running a marketplace in stealth mode since late last year, but had not made it public knowledge, since we were still building the technology and the resources required to effectively operate a marketplace," he added.
As of now, the site has 300 sellers that are offering around 30,000 products, with multiple offers on each product. This is a decrease from over 1 lakh products (with 1000 brands) across a number of in categories including mobiles, computers, cameras, appliances, lifestyle products, home and living, beauty and personal care, health and fitness, flowers and gifts, sports and leisure and stationary that the company was offering in September this year.
According to Boyanapalli, the reason behind the low numbers is because the company is still in the process of authenticating and evaluating the sellers on the site, and will keep adding them over time. "We actually removed a few sellers from the site since they were not falling in line with that we were trying to do. We have also removed a few categories, but will introduce them (and more) at a later point, when we have a decent amount of sellers," he said.
The site has also been completely revamped and is now offering customers with multiple offers on single products. The company is also providing essential details of sellers like number of orders seller cancels for every 100 they receive, top 100 offers of each category, customer ranking and reviews of sellers and delivery time so that customers can make an informed decision.
In February this year, Naspers, a South Africa-based multinational group of media and e-commerce platforms that is listed on the Johannesburg Stock Exchange, through its arm MIH, had invested Rs 8.5 crore ($1.7 million) in BTP. While we do not have an official confirmation on the same, sources close to the deal had confirmed the development to Techcircle.in.
Interestingly this would be yet another marketplace venture backed by Naspers. Naspers Group already owns Tradus under Ibibo and has also recently invested in Flipkart which is also believed to be working on a marketplace project (we don't know yet whether as a separate venture or as part of integrated existing e-com site a la Amazon).
BTP had earlier raised an undisclosed amount of angel funding from Rajan Anandan, Rehan Yar Khan, Sunil Kalra (all part of Indian Angel Network) besides one more unnamed individual. The MIH investment was the first institutional round of funding in the company. The company is now looking to raise $4-6 million to fuel its growth further.
Do you think turning into a marketplace is a smart decision? Share your views on the same. Also visit the new site and tell us what you think about it. In the meanwhile, we will get in touch with the founder to bring you an in-depth view of the transition and the challenges that came with it. Keep track of this space for more on that.
(Edited by Prem Udayabhanu)