While 2011 has been roller coaster ride for internet retailing in India as industry witnessed rise of business models across categories. Categories like apparel, high end fashion clothing/accessories and kids have successfully garnered attention along with impressions; however we have also sensed debuts and evolution of e-tailing of Grocery & FMCG products. Mygrahak.com, one of the early evangalizer of this space has been registering staggering growth and claims to be adding 250 transactions every day and high loyalty rates including 10000+ already registered families in NCR.. In order to know more about Mygrahak growth, expansion and projection, iamwire interacted with Ambuj Jhunjhunwala, Founder & CEO, mygrahak.com. Here are the excerpts of the interaction:-
How do you see the growing demand of online retail of Grocery & FMCG products in 2012?
We feel that in India, food and grocery can be organized online. We see consumers in Metro-Urban India replacing some parts of their meal with RTE (Ready to Eat) and fresh foods. We also see fast foods segment are gaining momentum. Pack sizes like 100 Gms, 200 Gms would be favourite among the bulky ones. Consumer would also look for wellness & organic products to replace some part of their consumption. Categories like Olive oil are slowly gaining grounds and may gain momentum in 2012. Sales of imported and indianised chocolates would precede Indian sweets as part of consumption also.
With the favorable consumer trends, we have seen significant traction and adoption rates from online registration to purchase on mygrahak.com. We have in the last 3 months seen good loyalty rates which signifies that ‘selling through relationships online rather than mere transactions on offline’ which would be a key differentiator to rising demand of online grocery.
Seeing the significant growth rate we will have mainly six categories Food & Grocery, Beauty Care, Organic & wellness products, Household care, Pet care and frozen foods & Ice-cream. These would lead to a typical hypermarket range. We have been seeing tremendous attraction for our category since the last 6 months and have been doubling our revenues every 3 months. We are about to cross the critical 1crore/month threshold. We have about 15,000 registered families with us and expect to scale upto 2lak registered families in Delhi NCR within the next 12 months, making us into the largest hypermarket shopping destination in the country.
As you claim to be adding 250 transactions every day, high loyalty rates including 10000+ already registered families in NCR. What strategies led you to have that staggering growth figure in Grocery/FMCG that is still in very nascent stage?
The growth which we have seen clearly indicates that Mygrahak.com as a ‘non-store’ concept is catering to the needs of the consumer. Value created to the consumer by shopping with mygrahak.com has seen the customers slowly disassociating with kiranawalas after 2-3 transactions with us. Ease of ordering either from work or home, Cash on Delivery, range of over 10000 products, loyalty rewards, combo deals rather than discounts on products and user friendly experience either online or offline lead to the growth we have seen in couple of months. On our customer acquisition front, we have approximately seen one referral to every 2 customer acquired.
We have also clearly engaged the customers through social media, digital campaigns and superior customer service. Unlike other categories in ecommerce, we operate in a repeat purchase categories, we have the customers with us each month for 48 hours,, in house logistics and strict warehouse quality control which leads to higher amount of customer satisfaction which leads to our convictions that retail would be organized online.
What is the current team size, logistics capabilities, warehousing infrastructure with mygrahak.com?
The current team size is 51, Spread across Marketing, Customer Care, Sales and Delivery. In logistics, MyGrahak uses hybrid delivery of Vans and Bikes. We have invested in software and a logistics division that optimizes delivery routes and times. All the vans are fitted with GPS system for real time delivery tracking. We currently have single warehouse where we stock and pack products as per orders.
What is your marketing mix and how do you see the role of social media while selling Grocery/ FMCG based products online?
To spread the word, MyGrahak has created 5 ladders of loyalty and has assigned marketing vehicles to each. These ladders are prospect, customer, supporter, advocate, and partner. The first two are for customer attraction and the remaining are for CRM. To identify prospects we have conducted extensive market research, focus group interviews, and dip stick studies in Delhi and NCR. To market to customers we have employed several marketing vehicles such as ATL marketing (print, PR, and radio), outdoor activation (home to home activations and kitty parties), and digital marketing. To maintain supporters who buy more than once, we provide personalized teasers for their birthdays and anniversaries, leaflets communicating how valuable they are to us, and delivery tags with feedback forms. To maintain relationships with our advocates, those who recommend us to friends and family, we give them referral cards. We send flowers & a designer leaflet to the referrals and then our telecallers follow up. In addition we communicate to them via social media and send personalized text SMS to them on their birthdays and anniversaries. We also go for lot of corporate marketing which have given us significant results.
Through Social Media, we build engagement and converse with our customer. We find this an exciting medium to inform the customer on various new launches, educate them on benefits of online purchase and keep them informed. Further, we acquire customers on our Facebook page by giving bill coupons offline/online and they get the discount codes only when they like Facebook leading to active fans on our page.
What are the expansion plans of mygrahak.com? Are you be rolling out to other cities and which new categories Mygrahak is thinking of to add in near future?
We believe that major potential for online retail of food and grocery exists in the top 10 cities in India. We cater to Delhi NCR. We plan to offer our full range of service across top 4 metros by 2014. In addition, we will also open selective categories of products for delivery across the nation in 2012.
We have already added six major categories viz Food & Grocery, Household Care, Organic &Wellness products, Beauty Care, Pet Care and Ice-creams & Frozen foods. We will add stationary, children care, birthday options, mobi recharge in near future but our main thrust would be in adding private label in food & groceries which will increase the margins considerably and ensure customer loyalty.
What is the split of orders via call centers and online arm of MyGrahak?
The split is 70:30. We get 70% orders online and rest 30% offline. We are seeing an increasingly large number of customers preferring to order on the net through email and the website.
How do you convince women (house wives) who usually deal with grocery consumption of the family to buy from Mygrahak?
We have a consumer detailer which we give to any consumer. This detailer of 7 pages has effective communications on benefits on buying from MyGrahak, benefits on buying by a call and a click and comparision of Online vs Kirana stores vs offline supermarkets.
Features like free home delivery, cash on delivery, free return of products within 14 days of delivery help us to build trust in us. Further we reach them through kitty parties and address their concern personally.
Having a call center to address their queries on delivery, prices convince them on the format and after couple of transaction they build trust and ensure high loyalty thereafter
What is the rate of return of orders and when mygrahak would enable credit card/online debit card payment options?
Our rate of return would be less than 0.75% on monthly transactions and around 1-2% orders get rescheduled on daily basis because of out of home/house locked situations. Unlike other ecommerce sites we do not bear losses due to return/damage since the end to end logistics is in our control. In addition this phenomenon is generally for categories where lead time for delivery is more than 2-3 days. This is similar either when the customer pays on COD and through card.