16 September 2015 09:25:03 IST

“Investments in logistics will play a vital role this festival season”

Interview with Snapdeal’s Kunal Bahl

Snapdeal, one of the top three e-commerce marketplaces in the country, with an annual run rate of $4 billion in GMV (gross merchandise value of goods sold), is test-marketing newer ways to deliver services ahead of the busy festival season. In an interview with BusinessLine, Co-Founder & CEO Kunal Bahl shares the company’s new plans as well as its move towards becoming the top e-retailer in terms of GMV. Excerpts:

What building blocks are you putting place for Snapdeal to get to the top position in terms of GMV?

To be honest, in our business, GMV or total value of goods sold has become a vanity metric to talk about.

The bigger thing to note is that there is no other e-commerce firm in India that has big B2C merchants; or big C2C merchants like those on our mobile marketplace Shopo, which has crossed 500,000 listings in less than two months; or a transaction velocity merchant like FreeCharge and with today’s launch, a FreeCharge Digital Wallet. No other e-commerce player has all of this in place.

How do you think Diwali sales will play out for Snapdeal versus the competition, given that last year saw websites crash, delayed deliveries, no-shows, etc?

Anywhere in the world when it is sale time, whether it is a Cyber Monday or Black Friday in the US or Alibaba’s 11/11 e-commerce sale in China, there is always some friction that emerges because of the huge spike in sales those few days.

More important, companies that have not invested in logistics infrastructure in the last six months will be in big trouble and will have a very tough time delivering a predictable customer experience.

What is the minimum investment that e-commerce firms must make to ensure a smooth customer experience?

While we have committed to spending $100 million in logistics infrastructure from now on, we have already invested (₹200 crore) in logistics and supply chain firm GoJavas earlier this year, where we are the largest shareholder.

All this plus our investments in building over a million square feet of warehousing space — Snapdeal Plus Centres, along with significant investments in technology have made shipping products 70 per cent faster over the last six months. Those investments in logistics are going to play out in favour of companies or against companies, if they didn’t make those investments already, during this festive season.

Will Snapdeal be able to make same-day deliveries this festival season?

It depends on what kind of products customers order. If the customer orders some obscure baby socks from Tirupur, same-day delivery may not happen. But, if it is a festival/standardised product, we will deliver it the same day.

We are already piloting a service called Snapdeal Instant in three cities — Mumbai, Delhi and Bengaluru — which is a 2-3 hour delivery service, for over a month now. It’s doing very well right now, if you order by 2 pm. you will get the delivery by 5 pm.

We are actually increasing the volumes on Snapdeal Instant as we speak, in these three cities, and also prepping other cities to launch the same service soon. We already do Sunday deliveries and same-day deliveries during flash sales.