Evaluating 10 E-Commerce Business Models

Submitted by: Saurabh Mhase (MBA3-1362)

1. www.rentmytext.in

Introduction:

Rentmytext is a Bangalore based startup company which deals with the business of

renting books. It is India's first online book renting store for engineering students.

Business Model:

Students can pick any book depending on the semester and their university. As a

refundable deposit students have to pay the maximum retail price of the book. They get

it delivered within 1-5 days on their doorsteps. There is no limit on the books that can

be rented and there are two payment methods – cash on delivery and online money

transfer. After the semester ends, one needs to return the books in mint condition to

have 60%-70% off on the deposit refunded.

Target Market: University students

Main revenue source: Renting books to the students

2. www.4thambit.com

Introduction:

4th ambit is an institution-based networking portal. It is founded by three engineering

batch mates from Kerala.

Business Model:

The company approaches various colleges and sets up hierarchical, structured networks

for them, which the team calls 'circuits'. To do this, the team collects the education

information of every student who studied in the college as well as the current batch.

From there on, they send invites to these students, and ask them to join 4thAmbit.

The students get a login ID and are connected on three levels -their classmates, their

batch mates and the larger alumni network. Members can endorse each other to ensure

that they have the necessary validations, which recruiters so desire. As the circuits are

close-ended, a circuit of one college does not get involved with the other. The idea is to

provide validated, certified resumes to recruiters, thereby ensuring a general high

standard of efficiency.

Target Market: Colleges without a good IT platform to help students

Main revenue source: Setting up hierarchical networks is main source of income for 4th

ambit.

3. www.travelkhana.com

Introduction:

Travelkhana is an online portal to book food while travelling by train. And the food will

be delivered on your seat from the restaurant you ordered food when train is at halt on

railway station.

Business Model:

Placing order:

Customers order food from Travelkhana though multiple channels: voice, online, and

SMS. Customer can dial Travelkhana at 8800138811. The call center operator collects

PNR number, mobile number and customer’s name. Operator enters the data in

Travelkhana’s platform through the order-taking web-based UI (part of Travelkhana’s

platform). Travelkhana platform retrieves the details of the train and presents them to

the operator, who asks the customer his/her preference of station/time for food

delivery. After the customer selects the location/time, the operator lists the available

vendors (with whom we have a tie-up) and choices of food, with prices. The customer

places the order, and the operator provides the total amount of the order. Finally, the

operator reads back the order to customer for confirmation, and provides an order

confirmation number.

The operator contacts each customer between 1 and 3 hours after the scheduled food

delivery to verify that the delivery had happened, collect feedback on food and service

quality. Travelkhana use the data to measure the accuracy of the deliveries, to improve

service quality, and to track vendors’ performance.

Connection with travel trade:

Travelkhana allow travel agents to book their orders directly through a user-ID. They

charge a healthy markup fee and make a healthy profit on their ticket sales.

TK also connect with these through their internal channel management team and offer

online means and e-mail campaigns to connect with the travel trade.

Main revenue source:

Travelkhana earns revenue through commissions charged from the vendor partners.

Currently the service is free for the customer. TK also plan to introduce customer service

charge in the future for the service that we offer.

4. www.printvenue.com

Introduction: Gurgaon based and German incubator Rocket

Internet backed PrintVenue calls itself the one-stop shop for all your printing needs. You

can have all your printing jobs done at the click of a few buttons why spend money and

effort running around. Started by Saurabh Kochar an ex- McKinsey & Company,

PrintVenue is primarily focusing on the SMB segment in the country.

Business Model:

There are millions of small businesses in India which want good quality products but do

not have access to them at affordable pricing. PrintVenue provide great quality

contemporary products to these businesses through an efficient channel at affordable

price. In fact this is the main reason why the founder decided to enter into digital online

printing. The team conducted a market research on the same and realized that the

printing market is highly unorganized and small businesses are always at a loss for good

products at cost effective prices.

Customers need to do is to register on the site, choose from around 2000 different

designs of business cards, card holders, stamps, notepad’s and letter heads, depending

on your need; and customise the same in minutes. In case if the design is already ready

just send an email to support@printvenue.com with details and CDR of artwork, make a

payment and you’re done. In the backend PrintVenue has operations that take

advantage of the economies of scale to print at impeccable quality but low cost. And

customers are assured to receive your order in 4 working days across 40 major cities in

the country.

5. www.naaptol.com:

Introduction:

Naaptol.com is India’s leading comparison based social shopping portal Be it consumer

electronic goods, laptops, mobiles, cameras, LCD TVs, or home appliances, you will find

all on Naaptol with the latest deals and the lowest prices available in the market.

Business model:

Find the product of your choice from the extensive product reviews and ratings from

experts compare it with others, get feedback and purchase it at the best available price.

This serves the buyers who wish to practically see the product before they buy.

Naaptol does not sell directly like ebay or rediff. What it does is it initiates selling.

Normally before making a buying decision of an expensive product the consumer does

an in depth research on the product from various websites which in this fast moving

world is an extremely tedious task. He would often wish a single website that would

meet all his buying needs. So Naaptol does this task for the customer.

60% of their business today comes from reaching out to the consumers, through the

print advertisements. 30% of our business comes in from reaching out to consumers

through TV advertisements. And about 10% of our business comes from the retail space.

Main Revenue Stream:

Margin with the dealers: Depending on the category, the margins in this sector is

between 15% to 30%.

6. www.groupon.com

Introduction:

Groupon is a deal-of-the-day website that features discounted gift certificates usable at

local or national companies. Groupon was launched in November 2008, By October

2010 Groupon served more than 150 market in North America and 100 markets in

Europe, Asia and South America and had 35 million registered users.

Business Model:

The company offers one "Groupon" per day in each of the markets it serves. The

Groupon works as an assurance contract using ThePoint's platform: if a certain number

of people sign up for the offer, then the deal becomes available to all; if the

predetermined minimum is not met, no one gets the deal that day This reduces risk for

retailers, who can treat the coupons as quantity discounts as well as sales

promotion tools. Groupon makes money by keeping approximately half the money the

customer pays for the coupon.

Main Revenue Stream:

Commissions from dealers for bulk deal around 10% to 20%.

7. www.renttherunway.com

Introduction:

Rent the Runway has transformed the retail industry by making designer dress and

accessory rentals a convenient and accessible luxury experience for millions of women.

With door-to-door delivery, a free second-size, and access to personal stylists, Rent the

Runway is a service that enables women to look and feel confident for any occasion.

Business Model:

Customers can lease Rent the Runway’s designer dresses and accessories for a 4- or 8-

day period for 10% of the retail price. Rent the Runway carries apparel in sizes 0 to 22,

depending on the designer. Each dress rental includes a back-up size at no additional

cost to ensure fit. Customers can get a second dress style with their order for an

additional $32.50. Rent the Runway provides customers with a pre-paid, pre-addressed

package to return the dress, and offers a $5 insurance fee to protect against accidents.

Rental prices include the dry cleaning and care of the garments. Rent the Runway also

rents accessories, including jewelry and handbags, and sells “essentials,” including

lingerie, tights, shape wear, and cosmetics.

Main Revenue Stream: Leasing of women clothes and accessories.

8. www.tumblr.com

Introduction:

Tumblr is a microblogging platform and social networking website founded by David

Karp and owned by Yahoo! Inc. The service allows users to post multimedia and other

content to a short-form blog. Users can follow other users' blogs, as well as make their

blogs private. Much of the website's features are accessed from the "dashboard"

interface, where the option to post content and posts of followed blogs appear.

The main revenue stream:

The site was monetized by advertising. Their first advertising launch started in May 2012

after 16 experimental campaigns. Tumblr made $13 million in revenue in 2012. Tumblr

reportedly spent $25 million to fund operations in 2012.

In 2013, Tumblr began allowing companies to pay to promote their own posts to a larger

audience. Tumblr Head of Sales, Lee Brown, has quoted the average ad purchase on

Tumblr to be nearly six figures. Tumblr also generates revenue by selling themes to

users to change the appearance of their blog.

9. www.pinterest.com

Introduction:

Pinterest is a visual discovery tool that people use to collect ideas for their different

projects and interests. People create and share collections (called “boards”) of visual

bookmarks (called “Pins”) that they use to do things like plan trips and projects, organize

events or save articles and recipes.

Pinterest also allows businesses to create pages aimed at promoting their businesses

online. Such pages can serve as a "virtual storefront".

Main Revenue stream:

Advertisements for businesses is the main revenue generating stream for pinterest.com

10. www.myntra.com

Introduction:

Myntra.com is an Indian online shopping retailer of fashion and casual lifestyle products,

headquartered in Bangalore

Business model:

Myntra.com is an aggregator of many brands. Its business model is based on procuring

current season merchandise from various brands and making them available on the

portal at the same time as in respective retail brand outlets. All these products are

offered to customers on MRP.

Main revenue stream:

Online Sales