So in this blog i tell you about Big basket, our grocery leader in India.
The story of a brand that made it possible for the customers to migrate from physical shopping to online.
Every now and then, a company emerges out of the blue and turns a market on its head.
These are brands that are able to connect the dots and see the big picture.
and They are able to spot early on vital trends that are likely to play out in the future.
They have a knack for presaging consumer habits and solving the pain points.
and They have the foresight to explore the fault lines and conflicts shaping their industries.
These brands focus on strategic expansion beyond traditional boundaries.
They innovate by taking new approaches to the customer experience.
About Big basket
So, the story start in 1999, when there was a.com boom
And this is one of the 1st e-commerce company. After 2 years (in 2001) they added grocery as well.
In starting, a lot of people came online, traffic was good but
You know in starting people don’t buy online, they are not ready to pay online.
So people knows them but they didn’t buy it.
So, they analyse and then they came to offline,
And in south India they got a huge success.
They opened a fab mart and sell everything in it.
But still it did not make much profit and in 2006 birla group overtook it.
And in 2011 they again return online, under sell retail network.
In 2011 only they got a funding now do try to understand this,
If you want to have a grocery business, then what are the options?
first is inventory Model of bigbasket,
Inventory model means, you should buy product directly from the company at a discounted rate.
and then start selling to your target audience and rest is my profit.
Second is Market place, like Amazon and flipkart do,
Here if i will get an order then i will transfer to other and they will deliver it.
And third is hybrid , here i am doing the both first and second means inventory Model, and Market place.
Now logically they did marketplace they captured small grocery shop and made a pact with them.
And now the orders they get via there app and website,
They so forward to these small grocery shop and deliver the product via a delivery boy.
So this was the simple process right?
Slowly they got the funding and they started to grow and then they shifted to inventory model.
Because in this there is a lot of margin and you can you can control your quality as well.
Now, they have 18000 listed products, more than 1000 brands and still it is under loss
But slowly there revenue is increasing.
There target is, by the end of 2020 we going to take 2000 crore revenue.
In my opinion fab mart was a good business model but in 1999’s internet used to be new technology.
And at that time people don’t trust internet actually and online payment as well.
There was no not good internet speed. So over all they took a very good step
By coming to offline market and made money and reinvested afterword.
So, from 2011 they are in loss, but in coming years they will be coming in profit because
It’s inventory model will keep on increasing.
With the advent of revenue there expenses will tend to decrease.
|Parent||Supermarket Grocery Supplies Pvt Ltd|
They do a simple strategy by ranking it’s customer
Basically if you are place any order today then you are not it’s customer according to them
So suppose in three month you placed an order like 2-3 times, then you became a silver customer for them
Here silver customer means that this is our potential customer.
And their platinum customer comes 95% repetitively.
So your expenditure get’s decreases time to time continuously.
In 13 funding round, they had taken 884 million dollar,
And recently they had taken 300 million dollar funding from Alibaba.
In June 2015 they acquired deliver and that inquisition was good according to me.
Because of this they are able to deliver product on time.
Before that in inventory model they used to get delay in delivery time.
But now they can deliver vegetable in 2 to 3 hours.
So this thing is possible due to delivery acquisition.
In grocery they operate in 35% of profit margin and in other item 10-12% of margin.
You may be finding it more but if you analyse there expenditure
like,website, app, delivery and many more things to run this all makes there expenditure
And still they are under loss, There is 2 trillion dollar economy in this globally,
Out of which 300 billion dollar online is there, if we talk about globally
Than it will fluctuate 15-30% in online retail.
So, if you want to do this type of business then target the cities
Don’t target village or towns area, because in cities there are a lot more awareness,
Less acquisition cost and you will be getting at a less rate.
And ultimately will tend to sell in your products and will increase your potential customer.
In village your accusation cost will to rise due to lack of education.
On 30th October, Big-basket’s customers’ data was leaked.
In routine dark web monitoring, Cybele, a United States-based cybersecurity intelligence firm,
found the database of BigBasket for sale in a cybercrime market for about 40000$,
which roughly amounts to 30 lakh rupees. Later on, BigBasket confirmed the data breach
and filed a complaint at Bengaluru Cyber Police Station.
Negligence on the part of the company allowed the data of 2 crore people to be exploited by hackers and scammers.
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