Indian e-commerce portal Yebhi has changed its business model, from an e-commerce marketplace it has now become an eCommerce product aggregator for other online stores. The company had indicated the same on its Facebook page on Tuesday, but the official announcement came in today. Also, Manmohan Agarwal has stepped down from the position of CEO and assumed the position of Managing Director. Yebhi’s co-founder Danish Ahmed, has now stepped into the CEO position.
“Fashion etail has evolved significantly in India and customers are seeking more information and engagement before purchasing a product,” says Danish Ahmed “They want to access to the largest variety, pay the lowest price and buy the trendiest product in the market. We are changing Yebhi to address these customers. We are bringing them variety from all the online and local stores, showing them prices with discounts & offers across these stores, and guiding them to products that would most suit their tastes, social circles and body structure.”
He added “E-Commerce is a very capital intensive industry and companies will continue to burn a lot of capital to acquire more customers. We decided to move out of that space, and leverage our learning’s and brand value to build a business that’s highly profitable and scalable. We are building a business which is capital efficient & at the same time consumer efficient in today’s scenario.”
Besides having coupons from portals like Flipkart, Myntra, Jabong etc. the company is also listing products from these sites. What is to be noted is that even though the model has changed, there is no major change in design of the product listing pages. Since it has given up on the e-commerce model, the company is now competing with online coupon, product listing and cashback sites.
Last year in November, we were speculating if its long time investors Nexus and Fidelity had given up on the ex e-commerce player as the company was intending to raise USD 30 M without the two.
We believe that it is a great strategic move by Yebhi. Since e-commerce was not proving to be profitable, the company has moved to being an affiliate marketer which is a hot place to be in at the moment. From 10% margins in e-commerce, the company can now gain in upto 80% margins by being an advertising channel for other e-commerce players.