Naaptol.com started as a comparison site has significantly grew over the past few years with its consistent efforts to evangelize the virtual shopping space through burgeoning ecommerce space in India. Recently Naaptol raised fund of $25 million (Rs 123 crore) from New Enterprise Associates (NEA) with existing early investors. Talking more about funding and Naaptol’s expansion plans, iamwire interacted with Manu Agarwal, Founder & CEO, Naaptol. Talking about the trends in ecommerce ecosystem in India in past one year Manu pointed out that increasing confidence of consumers and ecommerce players investing aggressively on marketing are fast catching trends. Here are the excerpts of the interview.
Naaptol.com seems to be strongly evangelizing the concept of virtual/home shopping through ecommerce space. So tell us what are the challenges Naaptol faced while cementing its position in ecommerce (virtual/home) ecosystem?
So far, the voyage of evangelizing virtual shopping through ecommerce has been great. Naaptol is one of the early players in this space and we have addressed the various challenges quite successfully. Broadly speaking, we have faced two challenges – logistic and Payment mechanism right from our inception.
How do you see the overall ecommerce (excluding travel) industry in India and which trends, development and innovations impressed you in last one year?
Last one year has really been great for the entire ecommerce ecosystem in the country. In fact ecommerce in India is still in nascent stage, however in the last one year we have seen the creation/evolvement of the market. The market has experienced few trends such as increasing confidence of consumers and ecommerce players investing aggressively on marketing. The whole perception of consumer about online medium has changed considerably, now consumers are shopping online with lucid payment mechanism such as Cash on Delivery (COD). At Naaptol 90 percent of orders get delivered via COD. Apart from it, ecommerce players are splurging a lot of money on marketing in order to have visibility and awareness in tier 2 and 3 cities.
Throw some light on the deal – $25 million (Rs 123 crore) fund raised by Naaptol, led by New Enterprise Associates (NEA). How do you see the unprecedented faith of investors in online businesses in India?
I would not like to disclose the detail of the fund raised, however we are going to use it for Naaptol’s strong presence on internet and television. We want to establish Napptol as a virtual shopping and in the past we have been aggressively pursuing the path of print media, however now would keep focus on web and television to gain maximum visibility and awareness about Naaptol. In terms of overall investment scenario, there has been a bit of euphoria, at the same time we can also see the investors are now being cautious while investing in to internet based businesses.
Which are the areas would be primarily stressed upon through the fund raised by Naaptol?
As I said earlier, we are going to spend it on multiple strategies, however would primarily use it for our strong presence on web and television to create greater space for our offering. The funds will be also used to fuel Naaptol’s massive hiring plans as well as invest in its Internet business, supply chain and inventory.
We have seen the trend of online companies for TV advertisement including Naaptol. Share what leverages Naaptol yielded through its TV campaigns as of now along with future strategies of Naaptol for such campaigns?
Naaptol’s television presence has primarily not been a brand building exercise. For us it is not all about generating traffic on our website, through television we want consumers to order the featured products instantly. I think television should be used as medium to aware people about your offering; however I do not think advertising on television can pull traffic on website of any ecommerce players.
How Naaptol Club (recently launched business model by Naaptol) has been doing so far and what is its expansion plan?
So far, Naaptol Club has been doing very well. We did not advertise it much as of now, however we have witnessed the increase in sales of Naaptol Club by 25 to 30 percent month on month. Through Naaptol Club, we are trying consumers to avail whopping discounts on fashion apparels like denims, formals and accessories like sunglasses, watches and perfumes. Now we are also looking to expand the catalogue of Naaptol Club aggressively.
Naaptol has been experimenting with its business model since inception, it started as comparison shopping, traces of which could be seen on website. Then it became media offers driven commerce, extending to ecommerce, further Naaptol club, and now there are talks of Naaptol’s own TV channel? So do you see these experiments would continue? How should a consumer see Naaptol as?
Look, we have been experimenting the whole idea where the industry and the consumers are? Initially we helped consumers to research the product online and buy offline. Later on, forayed in to virtual shopping space through ecommerce. Now we are gearing up for Television channel to take forth the concept of virtual shopping to the consumers in tier 2 and 3 cities. So, it is a natural progression and such experiments would continue in future too.
As Amazon is set for its Indian debut – what effect it will have on entire ecosystem, and do you feel Amazon’s debut would intensify competition in the Indian eCommerce market?
Amazon’s entry in Indian market would really be interesting to watch; in fact they are pioneer in evangelizing the concept of ecommerce globally. However I do not think it would be easy for them as ecommerce businesses have lots of local flavors and India is all together a different market in contrast of other markets globally. While working on Indian terrain Amazon would learn lots of things. As far as competition is concerned, Amazon would certainly spark stiff competition and it could be threat to the players operating in categories like books and electronics.
Lots of consumer’s complaints can be traced with various eCommerce players including Naaptol. What strategies and customer service programs Naaptol has enacted to overcome consumer’s issues?
We are trying our best to address the consumer’s issue; in fact to large extent we have been successful in addressing consumer’s complaints. See, complaints come because of various issues such as not of quality check, logistic and haphazard packaging. In order to make a hassle free shopping for consumers Naaptol has started reverse logistic processes including round the clock accessibility to call centers for consumer’s assistance. At the same time we are also ideating to have our own service centers to avoid consumers’ complaints and bring superior virtual shopping experience to the buyers.