Trying something new is a risk. Now imagine being the first one to try it. Higher risk! This is a major friction for any startup to acquire early users.
Though looking at some examples in the recent past it seems the returns are higher in being first cusomter than what an avg. late adopter customer gets. The first customer always gets talked about.
1. Cafe Coffee Day was the first to reward 4Square mayors in India. This created some significant buzz.
2. Barista was the first coffee shop to list on Freecharge. For a long-long time it was the only other option to McDonald’s coupons, directly impacting their top-line.
3. GE is the first sponsor of Quartz India. They were mentioned beyond this blog post.
4. Freecharge just become the first customer for Haptik. The buzz is going to go beyond this tweet.
There’s more to it. You get mentioned everytime the startup is mentioned. Your logo is seen on their site for testimonial for a long-long time. You get lower pricing. You get more attention and support. Your brand is perceived as “innovative”.
So next time a startup pitches you, don’t ask “who are your customers?”, just to feel comfortable that you will have company if something goes wrong. Just be entrepreneurial and sign up with them.
Go try something early!
Wrong fitting is one of the major reasons for products being exchanged in fashion ecommerce. Also, a lot of consumers would shy away from shopping apparels online because they would not know the right size to pick, specially when Size Coding are not generally standard between brands.
Leading fashion stores Myntra and Jabong have added just one extra piece of information to help consumers decide better. They tell you the measurements of the model in the pic and the size that they are wearing. The information might look trivial but it solves a major pain.
The answer to some critical problems in the virtual world need not always be big data or computer vision products. Think simple.
…Facebook does not hide the characters in the second attempt.
Quora does not ask to confirm password when registering.
PayTM differentiated between sign in and sign up based on your number.
Quora shows your DP when you type your email during signup.
These simple things make life easier, yet these are not the norm on the web. In making the system secure for few vulnerable ones we destroy the experience for the regular audience. In India, the offline world is a good example of this – at Cinemas, Malls, Airport et. al., the frisking is too inconvenient. Designing to handle exceptions is good, don’t confuse it with designed for exceptions. Security is about preventing mishaps without creating inconvenience or fear.
BootStrapp, is an eCommerce store selling unboxed, refurbished and excess-stock products. GreenDust is another player in this market that is making a mark, albeit in the offline market.
1. The idea of selling such products through online medium sounds good since there is higher discoverability.
2. Though the fact that the products are no-longer standard, creates a need to physically verify the condition of the product.
3. Since this is a non-standard packaging, there is a need for higher trust with the seller. People are buying such products offline from stores they already know about. Does that suggest that leading ecommerce stores will have a better play here? Amazon allows used products to be listed through its marketplace model in US.
4. GreenDust may not be doing great online but it already has 140+ offline stores across 15+ states. Is a hybrid model good or only offline play for now?
5. GreenDust is a using a celebrity, Vinay Pathak, for endorsement. Again a move to build more trust.
Instamojo, a transaction platform for digital goods, has launched “Social Pay” – a payment system where the buyer does not pay through real money but instead helps spread the word about the product through channels like Twitter/ Facebook. This is the future of money that guru’s having been professing about*.
1. Authors and artists have already been giving free copies of their work to social influencers, albeit in an unorganised manner – this tool puts a system in place to help scale things. With more bells and whistles that differentiates between tweets to 200 followers vs. 200K followers – this becomes a marketing juggernaut.
2. When the content goes viral, so will the platform.
3. Getting people to come back on a product page after the purchase to talk about the experience is a tough nut but very helpful to build real testimonials. Scheduled social payment or reminder for post experience social payment could be a great add on.
4. When you have told your friends about a new book purchase – there’s a higher chance that you will actually read the book. Some form of bias sets in.
5. This is exactly how Candy Crush went viral – you either pay $1 for extra life or buzz your friends on Facebook.
*Read more about the Future Of Money at Gaurav Mishra‘s Blog.
Freecharge, a utility bill payments site that pioneered the concept of retail coupon distribution with mobile recharge payments, has entered into a series of deals with very well known brands like Pepsi, McDonald’s and TV show Dance India Dance. The deal encourages the audience to consume and engage with the brands for a reward of Rs.20 discount on their next payment at Freecharge.in.
From what it looks like the deal does not involve any cash exchange between the two parties, similar to the Android-KitKat branding. It’s a win-win for both the parties and the consumers. The most interesting part is that Freechage is getting good TV Air-Time at a per user acquisition cost through the ads that the brands are paying for. TV coverage have always been paid for by the seconds, though for this one the only cost of Rs.20 is borne when there is a converting user. All the branding comes for free. Deals like these are innovative for an otherwise repetitive world of business development.
The ecommerce industry in India is going all out over the Great Online Shopping Festival. Popularly known as GOSF, this is India’s answer to Cyber Monday. Organized by Google to promote Adwords relations and revenue, this was a 1 day thing last year but this time it’s happening for 3 days. Lots of discounts and deals being thrown around to lure first time online buyers. Some are doing good stuff, some only creating noise. Some are leading it and others don’t want to feel left out. Since it is coming from Google, there is a mass acceptance from large eCommerce companies as well – read this to know why. All in all a good thing for the industry. Atleast it shows that there is an industry that can get together for a common cause. Nasscom had tried this with their WondersOfWeb initiative but this never went beyond few tweets, the low number video views on that channel are a proof of that.
Since FindYogi is also connected to the eCommerce ecosystem and 70%+ of our current revenues come from eCommerce sites, people expected us to do something around the GOSF. Though, we have always stayed away from being called a “price comparison site” or “deal site” and want to make a positioning around “buying decision platform” concentrating on helping users “find great products” and not just bargains but I guess the industry will continue to give us tags that already exist, untill we are not big enough to matter. Even we are tempted to curate some best buy deals during the GOSF as this would certainly mean some contribution to revenue. Then there is a choice of whether we should continue building processes that are long term or give in to such events that are short term distractions. For now we have chosen to do what was already in the plan and have kind of ignored this Shopping Festival. May be in the long run we will need to participate in such industry events to find new users and stay relevant in the ecosystem. Though, we have taken this as a good excuse to test coupons integration on our price listing tab for products.
Wishberg, an app for maintaining and sharing your wishlist, sends out email alerts with a subject line that reads like this:
You have inspired Pravin Jadhav for a new wish!
The mail is basically an alert for saying someone wished for what you wished. In Twitter analogy this is something like a Retweet. What’s important here is the heading does not say “Pravin wished for what you wished” but it says that “I ‘inspired’ Pravin”. The earlier message sounds more like the follower is same as you and does not make the earlier user superior but in the latter case the original user is made to look intellectually/socially more superior because he has now “inspired” others.
I don’t have the statistical details on the open rate of these mails, but I am assuming it must be pretty high. I have gone to check Wishberg everytime I get these mails.
For a system a click is an action but for the user the copy is the action. For example, earlier Facebook used to ask users to “Become a Fan” but that is now changed to “Like”. The end effect for the system is same in both cases but for the user a “Like” is less obligatory than “Becoming a Fan”. In the same way an endorsement button could be “Like” for FB, RT for Twitter, +1 for G+, Like/Dislike for YouTube or Agree/Disagree for a discussion. An agree/Disagree would not make sense on Youtube video. Similarly, someone Likes what you said is not as powerful as someone agrees to what you said in a debate. The “share” vs. “recommend” action on Facebook is another one to think about.
A thoughtful change in copy can change the user activity manifolds.
I was talking to a traditional apparels retailer recently. He runs a large store in a tier-3 city. He recently changed the interiors of his store. The western style chairs were replaced with the Indian style seating, that requires you to remove your footwear and sitdown on a Gaddi (cushion on the floor). He reports the conversion rates are now almost 100%. The casual window shopper is almost NIL. He believes the inertia of getting up, putting on the shoes and leaving without a purchase is high, hence the low bounce rate. But what about the inertia of removing the footwear and sitting down? Well, he says, “The cost of entertaining a customer is very high, you have to employ more staff for lesser chances of conversion. A genuine buyer will take the pain of settling down.” By making the efforts of sitting down the customer has already invested in the deal.
Last week, I wanted to get a phone repaired. The case was complicated, neighborhood service centers couldn’t solve it. I put up an ad on Sulekha, got a call from this one store that was 12KMs away, but he wouldn’t give me the exact quote on phone. He needed to “see” the phone to give the exact price. Since his was the only call that sounded confident enough of fixing it, I drove 12KMs. He saw the phone and quoted Rs.100 more than the upper limit he said on the phone. Did I pay him? Yes. I had already invested in this deal by traveling across half the city, I wouldn’t want that be a sunk cost. Was he cheating? NO. He never committed anything on phone.
Let’s see some online examples: The secret to Freecharge‘s (very) high coupon redemption rate is the Rs.10 “courier cost”. That Rs.10 doesn’t really pay up for the courier but by paying something for the coupon the user has invested in it, hence higher chances of him using it. It’s true that lesser people would order coupons because of this Rs.10 cost but in coupons business the only metrics that should matter is the redemption rate and that’s what the focus was.
The Amazon’s way of establishing inertia is Amazon Prime, the free 2-day shipping that you invested in by paying annually. $79 may be too much to invest for shipping but once done, one will spend more with Amazon to make it sound like a smart investment. Amazon is offering products with low marginal cost like movie streaming etc. to increase the purchase of Prime.
What are other equivalent of this inertia builder in the online world? How do you make the user invest in the deal before making the transaction? How do you make the user drive up your key metrics? Isn’t this required more for online world where travelling between shops is only a matter of click?
One example that comes to my mind is “add to cart to see final price?” that a lot of sites do. Although that feature was born of regulatory issues but can it be applied to the stores advantage? Like, “Add to cart and also enter credit card details” to see final price? I remember Via.com showed ‘price after applying coupon’ only when you have filled in your mobile number and email address. Is that enough inertia buildup? Is there something more that can be done?
Paul Graham recently wrote an essay encouraging startups do things that don’t scale. His essay has got me thinking about one recent startup on how they approached the problem they were looking to solve.
The Problem: Rental classifieds on the web are only half useful as you still have to visit the location before you can make a decision. There are enough data fields for the user to add property info and pics but users don’t bother filling them. The data is either entered by an owner who does this once in couple of years, so its difficult to train him on best practices or by agents who are not always looking to rent out a particular property but are only interested in getting a contact made with the potential clients. As a result, the potential tenant is left with a half useful site that has most data fields empty and most filter options become meaningless.
Enter Housing.co.in – The great UX of this site would have fallen flat for just one reason – listings without pictures. The site would have been only as useful as incumbent players had they not had the property pics. They have taken the pain of making sure every listing has pictures. From what I’ve learned, this wasn’t easy for Housing. They have about 60 employees in Bangalore only for engaging with brokers so that the data quality doesn’t suffer. I am sure that number is similar for other cities. It might look inefficient but hey, that’s their hare in the hat.
We have seen this happen in the past. When Flipkart thought of growing eCommerce faster, it set out to setup its own logistics system. At Freecharge we realised that retailers are yet to adapt to electronic coupons. Instead of hoping for them to change, we setup a whole system of distributing paper printed coupons. Even Google had people checking the quality of pages manually in the initial days. Amazon had issues with clustering offers from different sellers under one product. The tool they made to solve that problem, Mechanical Turk, is now a product by itself. These steps are expensive and face a lot resistance from investors but with time, these become your biggest differentiator.
At FindYogi, we are solving a small part of our problem in a manner that most people don’t approve of. We are collecting product data sheets manually. When we started, we believed that we could easily scrape content from ecommerce companies or sites like GSMArena but we were wrong. We still see that a lot of competitors and ecommerce companies who adopted to such practices have wrong/incomplete data. They will also change soon.
I am not sure what VCs mean when they say ‘it’s not scalable’. I don’t even know if that is a criticism or a compliment. What I do know is that it’s completely worth the pain and it’s not replicable over night.