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INDIAMART CASE

STUDY
ASSIGNMENT

SUBMITTED TO: SUBMITTED BY:

Mr. Divya Kumar Gupta Kanika Bansal

Ritika Singhal

Akansha Gupta

Sunny Nigam
EXECUTIVE SUMMARY

This case is about IndiaMart which was founded by two Indians named Dinesh Agarwal
and Brijesh Agarwal in April 1996. IndiaMart is Indias largest online B2B marketplace,
which helped many buyers and suppliers to meet on a common platform and do the
business. It helped buyers source products and services from SME and simultaneously it
provided 360 degree solution to the SMEs including listing, Storefront creation,
certification and access to buyers needs. This case talks about how IndiaMart evoluted in
the country, various challenges faced by the company and how they tackled their each
challenge with its innovation. At last IndiaMart is considered as one of the top companies
of India.

FACTS FROM THE CASE

EVOLUTION OF INDIAMART: Dinesh an indian graduate was working in the United


States. He sensed the difference between internet penetration in both the countries. He
thought of establishing the ISP(Internet Service Provider) in India but private participation
was not allowed in India. So he then thought of launching the website which will connect
the SME exporters of India to foreign buyers. Thus born IndiaMart.

THE EARLY DAYS AND CHALLENGES GALORE: As IndiaMart is the online


directory, the sourcing of data for creating this directory was a challenge. The other
challenge was low internet penetration and lack of credible source of information related
to SMEs.

To tackle this challenge Dinesh coined a term Free Listing and Free Enquiry Form and
distributed in among SMEs through Trade Fairs, whosoever filled these forms were listed
free on Online Directory.

THE DOTCOM BUST: In this a dotcom company which was not sound monetized had to
shut down their business. It resulted in global meltdown and resulted in 40% reduction in
export volumes from India. But howsoever IndiaMart survived which was recognized by
Business World Magazine team and it became popular from this incidence. The success
story behind it was Search Engine Optimization which act as advertisement for IndiaMart.

CHANGING LANDSCAPE:2004-2007: As after dotcom bust, IndiaMart thought of


generating revenue through paid subscriptions. The customers who were free subscribers
they were given very little space on media and who were paid subscribers were given alot
more facilities than providing space , they were ranked higher in the search results of
suppliers.

CHANGING LANDSCAPE :2007-2010: IndiaMart focused on Domestic . Google


changed its SEO ranking criteria in which when a buyer searches for product then the
suppliers from the same geography areas are shown. So IndiaMart started focusing on
Domestic and raised US$ 10 million for the same.

INNOVATIONS

1. Free Listing and Free Enquiry Form: Suppliers can register on online directory at free of
cost.

2. Indian Red Tape: It is the tool for establishing the trust profile of suppliers.It takes
various registration details of suppliers.

3.Preferred Number Service: It is a number which help buyers to connect with the
suppliers.

4. Buy Lead: In this product a buyer posts his requirements for the product and various
suppliers can track this and the supplier who is able to meet his requirement contacts him.
This saves time at both ends.

5. Mobile App: It made easier for both buyer and supplier to do a business through this
App.

COMPETITION

IndiaMart a biggest and nearest competitor was Alibaba.com a china based e-commerce
company, was started to cater to small business.
Naukri.com:- As it became Indias first online company, but that acquired the more
market share.

Justdial: A search service provider with a database of listing across categories. Ranked
99th in the 100 most valuable companies in India.

Tradeindia.com:Tradeindia received an average of 20.5 million hits per month. In 2013,


the platform had a database of 27,44,394 registered user.

Global sources ltd: It was a Hong-Kong based Business-to-Business media company that
provided information and integrated marketing servicesalso provide subsidiaries services
that allowed global buyers to identify suppliers and product.

Thomasnet.com: it was an information and technology company that connected


manufacturing and industrial buyers and sellers. It covers 5400 strong buyer community
comprised of traders, fabricators, re-rollers and end-users.

CHALLENGES

CUSTOMER ACQUISITION: - Their earlier attempt at increasing the speed of


customer acquisition had only been partially successful, and it was extremely
important that this time it had to be bang on target, the new competitors also came
into existence due to that it becoming more challengeable for IndiaMart to fulfill
their target.
REDUCING SUPPLIER CHURN:- Supplier churn rate stood at 26% as on 2014,
and IndiaMart targeted to bring it down to 20% by 2015.
INCREASING LEVEL OF MOBILE PENETRATION: - client began using the
mobile phone as the primary mode of connecting/ trancing of the internet. By that it
became a challenge to them how they have to provide convenient facility to their
customer, so that they can access them through mobile phone.
LOW INTERNET PENETRATION: - In time to come internet was going to bring
in true convergence, and if he could find an interim solution to these problem,
IndiaMart would get a great first mover advantage.
LACK OF CREDIBLE SOURCE OF INFORMATION RELATED TO SMALL
AND MEDIUM BUSINESSES: -`Through that they cannot find out how to make
popular of their brand in SMEs market.
Aftermath of the dotcom bust and the 9/11 terror strokes, business boomed at
IndiaMart, by that their market share get reduced and afterthought became
challengeable for them how to regain that market share.
MANAGING EMPLOYEE ATTRITION:-Employees were planning to go on
holiday, for manager it became challenger how to distribute the work of them.
ENCOURAGING SUPPLIERS TO BE BUYERS:-Increasing the attractiveness for
more number of suppliers to be engaged with the platform; and increase the number
on the other side platform, large-market and promotion may be required.
EXPENDING SUPPLIER BASE:-For increasing the supplier base it requires lots of
financial investment, in term of opening field offices and after that converting them
into permanent suppliers becoming more challengeable.