MAKING THE BEST OF ONLINE AND OFFLINE AMIT SINHA, CHIEF OPERATING OFFICER, PAYTM MALL
Q] It was the first festive season sale for Paytm Mall, what kind of response did you get?
It was a big success from a business point of view. From every parameter that we could think of, we hit the highest ever results historically for Paytm Mall, and that too by a huge margin. We saw traffic go up by 30X and saw a significant increase in sales. So, we were able to test our systems on all the parameters, which thankfully didn’t crash. We saw transactions coming from more than 850 towns in the country in those four days itself, from Akhnoor in Kashmir to the North-east, which was amazing because we were not aware that people from such locations also purchased from Paytm Mall. And on the seller side, shop-keepers from more than 250 cities were aligned to our platform. We were present in every nook and corner of the country. Before the sale, we were expecting about five million new buyers on our platform. We crossed that.
Q] Overall, how many sellers do you have on your platform today?
Right now, we have around 60,000-70,000 sellers on our platform. All of these are brandauthorized sellers, doing sales on their behalf. The actual sales are done by the shopkeeper who is either assigned by the brands, or who has a real world storefront shop somewhere.
Q] You have recently entered the advertising game, with an ambitious Rs 1000 crore earmarked for promotions and marketing in the festive season, how did your first TVC help?
The ad really helped in increasing organic traffic on our website. Also, a lot of people commented that it is a great ad and very Indian in essence -- it showed a lot of things Indians do specifically. Apart from the TVC, we did Print ads. A lot of Print ads are being placed by our partners- small retailers who allow the use of the Paytm QR code. I have seen so many hoardings which have the Paytm QR code. There is this brand called Khadim in Calcutta, their footfall is so huge that they need to call the police to control the crowds at their flagship store in Park Street during Durga Puja. They brought in Print ads with our QR code and also displayed it in their stores. Khadim store is now on Paytm Mall, we invest a lot in the relationship. Sellers and shopkeepers are partnering with us because they see a value in it, otherwise who does it for free?
Q] Not just the sellers, even brands are showing ads with Paytm at the forefront, like the recent Coke ad. How do such partnerships work?
Yes, the Coke ad, brought out the flavor of the festive season well. It has really done wonders for us. In fact, we are working very closely with all the major brands. For example, Samsung and LG, among appliance brands, have a store on Paytm and we are very deeply integrated with their channel, their emotions, etc. Similarly in footwear, we have brands like Puma, and Red Tape. In FMCG, all the major brands like Hindustan Unilever, Cadbury and P&G are working with us. So, across the whole journey, there are multiple places where we typically would partner with a brand. We don’t just buy inventory and then do whatever we want with inventory. We have to work with the brand, because at the end of the day, we are championing them.
Q] Your mother company Paytm is the number one player in the payments space. How soon do you think you will get to that position?
Our model and the business that we are operating in is significantly different from the others. In fact, only 2% of the commerce business in this country happens through the e-commerce platform. 98% happens in the real, physical world. And that is where we are working right now-- as technology partners to the shopkeepers, to the brands, channel, to help them reach out to consumers and bring in better services. So our focus is not on being number 1 or 2, what we look at is, how much of business were we able to drive for our shop-keepers. The results have been very encouraging in the first 4-5 months itself. There are shopkeepers who actually have seen increase of more than 20% of sales owing to associating with Paytm Mall. That is a parameter we would like to evaluate ourselves on, and if we hit that, we are successful, and the business will get built in that process. By the end of this financial year, we are targeting an annualised run rate of USD 4 billion.
Q] Where is the big money - in physical stores or e-commerce websites?
The point is that there is a value in having a shopfront in a physical location, and that’s why the consumer still walks into it. Not everything can be done online, not everything can be done offline. Both have their own pros and cons. What we are trying to bring in is a mix of both.
From our perspective, the consumer should have a seamless experience across all platforms. And in this process, obviously we have to enable the shopkeepers to ensure that they are able to offer the best possible services to the consumer which is where the commerce platform and the technology enablement of the shopkeepers comes in.
Q] What percentage of Paytm Mall sales come from these physical stores where you can scan the QR code and what comes from the app or website?
It’s actually a very intermeshed model, thus difficult to give numbers. The way it happens is, you can scan the QR code, and if the shopkeeper doesn’t have that SKU available, he can get it shipped from somewhere else. For e.g. It solves the problem of shopkeepers who can’t keep all sizes of a particular shoe due to limited space. Shopkeepers really are loving it, because more than 40% of the sales actually get turned down in the shop because you might not have the right SKU at that point. What Paytm Mall helps him do is ensure that he doesn’t lose the sale at that point in time and gives him the option of delivering the product to the customer. So the discovery is happening offline, while the sale is happening online.
Q] What’s the big plan post the festive season?
For us the festive season doesn’t end because we are so well penetrated in the country, where there is always some festival or the other that we can ride on. We can’t say that we are an offline-also player and not be present there. So, there is going to be a lot of activity even post this season. Our entire model is innovative and at every bend, we strive to innovate. The app itself has undergone a massive change in terms of features. Nobody has brand stores like us, which is a huge innovation.
Q] I was going through a Redseer report which tracks e-commerce sales during festive season. It showed Amazon and Flipkart, and had no mention of Paytm Mall… does that worry you?
We are in a very different space. We don’t understand retailing, but what we know best is how we can bring in technology to consumers through retail in a way that everybody in the value chain -- the consumer, shopkeeper, distributor and brand--gains. And that’s where our strength lies. We know how to build technology at scale, great technology which is very consumer friendly. And that is what we are focusing on. It doesn’t matter if people say we are small or large. We at Paytm believe that we should do something that is really different from what everybody else is doing. That would give real value to people. If we can’t disrupt or innovate, there is no fun. We don’t want to be just another player.