DealShare explores O2O business model for offering last mile service
In an interaction with Express Computer, Rajat Shikhar, Founder & Chief Product Officer, DealShare, delves into Covid-19 disruption in the online retail space and how is DealShare tapping the opportunities in a technology-driven manner
What’s your assessment of the COVID disruption, in terms of the challenges and opportunities for the online retail, e-commerce, household essentials vertical?
DealShare operates in a unique market with the opportunity to create the next big e-commerce platform by reaching low and mid-income audiences in Tier 2 and Tier 3 markets, with a highly relevant catalog and cost-effective operations. Our catalogue is primarily in grocery and essentials, so while we faced initial disruptions in service, eventually we have seen expansion in demand as new users are jumping on the online shopping bandwagon, and consumption of existing users has increased in favour of e-commerce.
As a business, we see clear tailwinds from the Covid situation. Due to aggregation of demand on smaller set of essential and grocery products and also surge in demand of some categories, we have experienced better pricing and margins. Due to the need for social distancing and personal safety, there is an increasing adoption of e-commerce which reduces our marketing expenses, thereby improving our unit economics even further. On the operations end, we have observed that densification of orders in residential areas has improved overall efficiency while due to closure of other industries, availability of delivery partners for this service has not gone down.
How was DealShare’s preparedness to address the challenges posed by the situation, with regards to IT and digital practices and organisational culture?
Being an operation-centric business, the Covid situation created obvious roadblocks, but we adapted to the new situation fast and built systems which would help us serve our customers’ new needs better. We evolved tech to support contact-less delivery with more digital payment options on app as well as at doorstep. We also made it easier to buy more items which was the need of the hour by improving our cart functionality. We also collaborated with the Government of Rajasthan to build a procurement system for supporting 45,000 Kirana stores across the state. This B2B system would help in sourcing for these Kirana stores, and it has formed the basis for B2B systems. As an organisation, we demonstrated aplomb during the time of crisis and everyone pitched in, right from responding to shifts in customer expectations to adapting our processes, making them efficient and suitable for working remotely.
What have been the major trend shifts among your customers and partners during this period?
On the consumer end, there is a significant shift in shopping behaviour, and this will be enduring even post Covid. There are two underlying reasons for this trend; first, personal safety; second, due economic implications of this situation there is caution in spending and only essentials like food, healthcare are taking precedence. The preferences are moving away from luxury, travel and indulgent categories and shifting towards personal care, nutrition and health.
On partners end, we are committed to working with local manufacturers and brands, giving them fillip to grow in not just the region of their existence, but also in other geographies. As we operate in grocery and essential space, the demand post lockdown has not gone down and hence after initial disruption due to lack of workers, now things are back on track. Post initial disruption, our delivery partners have also been reinstated and we take immense precautions to give them the confidence to continue with us. It is really commendable how they have supported us during this period.
How are Artificial Intelligence and other emerging technologies transforming customer experience, and what are your efforts in this direction?
We are deploying AI/ML to solve a variety of consumer and efficiency problems. On the customer end, we are looking at the most relevant recommendations, personalisation and searches. On the efficiency side, we are deploying it to improve delivery efficiency by improving location, routing and forecasting demand, stock movements and fraud prevention.
How will digital adoption power the new normal among Kirana stores and hyperlocal ecosystems?
E-commerce and O2O models are set to play critical role in convenience during the social distancing era. Earlier it was easy to understand whether a particular customer segment has propensity to see value in online shopping, but today it’s hard to segregate as a significant number of users has started shifting towards online shopping and we will see a hybrid behaviour when it comes to online vs offline shopping. Users will make most of the digital platforms whether it is about convenience of home delivery or contact-less deliveries with online payment. At DealShare, we have been exploring O2O as business model for offering our service to last mile user, in addition to being an e-commerce platform.
What are DealShare’s focus areas in the near future?
We are focusing on taking customer experience to the next level by working on key shopping elements like payments, performance and personalisation. We are also working on taking our services closer to the hyperlocal ecosystem of our consumers, providing better service, support and catalogue. We are deploying data and AI solutions to provide more personalised experiences and increase operational efficiency. We are looking at improving engagement with our customers by investing in gamification, stepping up our interactivity with consumers. Harnessing the power of social buying with the right mix of conversation.