According to reports, total online classifieds market in India has seen a significant growth in past few years. As a category, it has witnessed CAGR of 45% from 2009, and has reached Rs 23.54 billion in 2012 contributing share of 5% to the overall digital commerce market in India. It is expected that it will grow by another 30% to reach INR 30.61 billion by end of this year. Though it mainly includes jobs classifieds, matrimony, property and more where C2C classifieds are a small fraction of the market.
OLX is one of the C2C online classified site which act as a platform for connecting buyers and sellers by posting a free ad on the website and contributing to the growth of inline classified businesses in India. As per Alexa rankings, Olx.in ranks 22 in India. We caught up with Amarjit Batra, Country Manager, OLX India, to know about the status of classified industry in India and how Olx is performing in the segment.
Here is the detailed interaction
What is your revenue model?
Paid listing. It is the key revenue source in the long run because people are paying their own money in the free classified environment. For us this business in the end is a very profitable business. We are not focussing on monetizing, our focus is on growth and reaching where the consumer want us.
Why people in India are not selling their old stuff online?
When we came up with this idea in May 2011, people didn’t even know this can be done. You will never find on print classified that somebody want to sell second hand mobile, furniture, etc. But now, the idea has spread across, that OLX is a platform which is not charging money, making potential buyers to meet sellers and helping them to find goods at a right price and allowing sellers to sell stuff that they don’t need now.
How much local effect is inbuilt in your product. Suppose, if we want to meet the sellers nearby how does your system identify it?
There is a process of evolution. We have focussed so far on the business cities. We are going into local cities in the next phase. There are features which helps customers let see ads in your locality, and these features are mobile enabled.
Who handles the quality control and the delivery part? Who controls what is being sold?
We don’t come in delivery at all. We moderate all ads, we make sure site is clean. We are like Youtube, if we find something is wrong, we remove it instantly.
What about the other companies which are in the same space, such as Quikr?
Though in the same space but they are doing a lot of other things, such as e-commerce, lead generation, business dealers, etc. But, we are more focussed on consumer technology. Today, we are the largest marketplace in our business. For us brand awareness and page-views are the key metrics, we are 25-30% bigger than others. According to Comscore, this year we had around 8.2 million total unique visitors for the month of April with total visits reaching to approx 19 million. We get about 120 million annual page views on Comscore and we estimate to get around 2.0 million ads every month on OLX.in, for now we have 6.7 mn+ ads that are live on the website. With this, Vehicles (Cars+Bikes) form a majority of the ads on Olx, other than Electronics and Mobile. Others are just trying to reach where we are, i think we have 60% market today. Even our awareness is three times more than Quikr in the market.
What’s the reason behind that? Marketing?
People like us more, that’s simple. Everyone is doing marketing but this doesn’t change things. In the end the numbers tell what customers like, or searching for.
Olx has been very active in promoting it via TVCs, how has been the impact of advertisements on overall tractions on the site?
Since the time we have started advertising on TV, we have witnessed a great increase in traction and PVs which has increased by over 35 times.
We feel that innovation doesn’t get funded in this country. What are your comments?
Absolutely, you must come up with completely innovative idea. If you don’t get funded it means you don’t have roots of the concept. Until and unless few innovative model succeed, till then funding of innovative model will never happen. When you will move forward you will find a lot of churn happening in industry, a lot of learning and money being trade off in the industry.
What is the demographics of consumption for OLX?
We structured ourselves to present in all cities in India. Our objective is to provide platform for people in every city in India, especially those cities which still don’t have a marketplace today, not even in print. Classified is present in maximum 25 or so cities in India. We are trying to create a larger market first, acted in 500+ cities. Though there are certain markets that are delivering very fast for us, maximum growth will come from Tier 2 or Tier 3 towns and we are already present there. We also have mobile apps that will help in growth in these cities. Next wave of growth of internet will come from mobile and local.
How do you see internet consumption by people in the South East Asian markets? What is the pattern and how they are adopting internet?
We are not looking at all the South Asian markets, but I think India has the lowest penetration of internet among South East nations. If you look at Philippines, Indonesia and Malaysia, you will find that internet penetration in markets smaller than India is much higher, about 20-35%. Some of the growth which has happened in India is because of English.
Are you planning any localisation of language?
Yes we are. We launched a local language around 2 or 3 years back. Today OLX can be seen in 5 languages beside English i.e.Hindi, Tamil, Telugu, Marathi, kannada. We went early for it because we felt that at some point of time people will need local languages.
When will you start focussing on revenue?
We will focus on monetization, as soon as we are comfortable and ready, no date has been decided yet, it could be 6 months, year or 2.
Will your monetization strategy work? Will there be chances of bounce back?
Yes, it will work for sure, as long as OLX is the clear leader. For now we are not leaders we are just 50%. For us leadership is a challenge, we need to keep ahead in competition. In mobile we are almost double of competitors, overall we are 50-60% ahead of them.
Is competition there globally also? Or is OLX the leader?
We have strong presence in three belts i.e. Latin America where Brazil is the flagship country, then Africa where South Africa, Nigeria and Kenya are key focus area, thirdly, South Asia where India Afghanistan, Pakistan are ahead but India is our key. Olx will become xerox of ecommerce for selling.
Any random pain points you came across from the team, markets or the government?
So far the growth has been fabulous. The only pain point we see today is to grow the market. We created the market and will continue to grow it, as there is no example for us so we need to innovate in marketing, product, mobile, strategy etc. The challenge for us is to figure what can we do to make our customer experience better. A lot of consumer analytics is to be done.
How is OLX promoting the community offline?
We basically did garage sale to reach corporate, car fare to get people, and initiatives such as web sellers programs.Category Internet