Naukri.com Vikalpa

It was a cool and foggy November morning in Delhi and Sanjeev Bikhchandani,founder and CEO of naukri.com, sat in his room thinking about the way forwardfor the company. Two major competitors, monsterindia and jobsahead, had

become one (monster bought jobsahead) a few months earlier to create a formidableforce in the online recruitment market in India. naukri.com was launched in 1997when there were just 14,000 internet users in India and had become the premier onlinerecruitment site in the country with more than 72,000 paid job listings, more thanhalf a million jobs, a database of more than 2.5 million resumes, and more than 15,000current clients. naukri.com’s revenues were set to double from Rs. 200 million in2003-04 to Rs. 400 million in 2004-05. The six months ending September 2004 hadseen revenues of approximately Rs. 210 million. Estimates suggest that naukri.com’ssite traffic was more than the combined traffic of its next two competitors in India— jobsahead.com and monsterindia.com. The traffic at the naukri.com site, ranked1007 in the world by alexa.com, an online traffic monitoring site as on August 16,2004, had improved to approximately 730 by October 31. This was well below the160th ranking of monster.com — the leading online job site in the world, based inthe US, but comparable to that of hotjobs and careerbuilder — the leading competitorsto monster.com in the US (Exhibits 1a, b, c, 2, and 3).

Out of the 280 employees that naukri.com had in August 2004, 170 were in thesalesforce responsible for calling on the HR departments of firms and obtaining theirbusiness (advertising jobs online and other related services). These salespeople werespread over the branches in 20 cities over India (Exhibit 4). The ramp up in saleseffort beginning 2002 (Exhibit 5) had contributed to the increase in the naukri.combusiness from Rs. 9.2 million in 2000-01 to Rs. 200 million in 2003-04. With thegalloping growth in revenues that may not necessarily be coming from the sales effort(given the increasing spend on advertising), it was not clear whether Bikhchandanineeded to further beef up the salesforce or focus more on advertising to build thebrand. Furthermore, as the organization grew, incentive, monitoring, and controlcosts for the salesforce were rising; in fact, 48 per cent of the costs of naukri.comwere associated with the salesforce.

Moreover, informal feedback coming from the salesforce in Delhi suggested thatmonsterindia.com was now offering both the monsterindia.com and the jobsahead.comsites to naukri.com customers at a 10 per cent mark-up over the naukri.com pricefor a similar product.

naukri.comArvind Sahay

describes a real-life situationfaced, a decision or action

taken by an individualmanager or by an

organization at the strategic,functional or operational

levels

KEY WORDS

Online Recruitment

RecruitmentAdvertisement Market

naukri.com

monsterindia.com

jobsahead.com

M A N A G E M E N TC A S E

VIKALPA • VOLUME 30 • NO 2 • APRIL - JUNE 2005 113

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GENESIS OF NAUKRI.COM

After working for three years with Lintas (India), Bikh-chandani did his post-graduate programme in manage-ment from the Indian Institute of Management, Ahmeda-bad (IIMA) in 1989. Thereafter, he worked for a yearwith GSK (then HMM). HMM had an open plan officeand during his tenure there he would often hear hiscolleagues discuss the articles in Business India — thethen premier business magazine in India. Without ex-ception, he noted that everyone would start readingBusiness India from the back — the section of the mag-azine containing the job advertisements — jobs obvious-ly being a high-interest reading category. Conversationswith head-hunters led to the realization that there werealso a lot of unadvertised jobs in the marketplace. Bikh-chandani quit his job in October 1990 and started acompany called InfoEdge. However, InfoEdge was notan online recruitment service but was in the businessof producing and selling databases, reports, and feasi-bility studies. The worldwide web had not yet startedmaking its business presence felt in a significant wayin India. naukri.com was launched in 1997, after somefalse starts, as described below, subsequent to the arrivalof the worldwide web.

In 1991, the Government of India’s Department ofTelecom (DoT) advertised that it was starting a videotexservice. DoT would provide the equivalent of a serverwhich would host different databases enabling thecustomers to access information for a fee. The advertise-ment was meant for people who could provide andmaintain the databases. Out of more than 50 companiesthat applied, 30 were short-listed including InfoEdge —the only one for a job database. The idea was that thecustomers accessing the job database provided byInfoEdge on the server would pay Rs. 50. Bikhchandaniwould collect, organize, enter, and maintain jobs fromall over India on the database. The product was pro-posed to be named as JobNet. The DoT project neverhappened. Another alternative that was explored wasIndonet run by the Computer Maintenance CorporationPvt. Ltd. (CMC) that had very few users and was veryexpensive.

Bikhchandani came to know of the worldwide webfrom a trip to IT Asia in October, 1996. The naukri.comsite was up and running in March 1997 as a division ofInfoEdge Pvt. Ltd., with a server hired at $25 per monthin the US with the help of his brother who paid the

monthly rent. Anil Lall, a friend of Bikhchandani andan expert programmer who is the formal head of tech-nology for naukri.com, wrote the initial software codethat enabled it to go commercial in October 1997. WhileLall continues his association with the firm and is amember of the Board of Directors, active leadership ofthe technology team that supports naukri.com on a day-to-day basis on the internet now rests with others. Theother co-founder of naukri.com was V N Saroja, a 1990alumnus of IIMA who looked after operations till late2003 when she left to become an independent manage-ment consultant.

Bikhchandani did not take salary from naukri.comfrom 1997 to 2000. To make ends meet, he took up asecond job with the newspaper, The Pioneer, first as aconsulting editor and then as the Business Head. Atlaunch, naukri.com was a job listing board and did notoffer any services. The company had a headcount of nineand had no sales staff. Initial business was obtained bysending out letters to HR managers culled from a da-tabase of 3,000 HR managers. In the initial years,naukri.com, being the first mover in the online recruit-ment space in India, received a large amount of presscoverage. As a bootstrap start-up, this media coveragewas invaluable in gaining a mindshare at no cost to thecompany. Bikhchandani recalled:

My idea of getting into the recruitment spacewith a database was ahead of its time in termsof the infrastructure available to action the ideain India. We hit on the naukri.com name almostby default — it was not our first choice, but allthe other possible domain names in English hadalready been taken.

naukri.com operated on a bootstrap mode till April2000. One day after jobsahead went ahead with Rs.seven million of advertising at the Sharjah cricket meet,Bikhchandani accepted Rs. 74 million of venture capitalfunding from ICICI Ventures. At that time, naukri.comhad just achieved annual revenues of Rs. 3.6 million forthe year 1999-2000. The combined turnover of naukri.comand the offline executive search firm, Quadrangle, thatcomprised InfoEdge Pvt. Ltd., is expected to exceed Rs.450 million in 2004-05. The quarterly revenues of thecombined entity (naukri.com + Quadrangle) between1997 and 2004 are given in Exhibit 6.

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THE RECRUITMENT ADVERTISEMENTMARKET IN INDIA

The overall (print + online) recruitment advertisementmarket in India was worth about Rs. 5.6 billion annuallyin 2003, of which the print media alone was about Rs.5.2 billion. It is expected that by 2007, online recruitmentadvertising will grow between Rs. 1.5 and Rs. 2.5 billionwhile the print advertising will grow at 8 per cent annua-lly to about Rs. 6.5 billion.1,2 Another figure for themarket size was cited at Rs. 8 billion annually in 2000with a growth rate of 10 per cent.3 Of this figure, re-cruitment advertisements in English language printmedia are steady at Rs. 1.2 billion, but the online recruit-ment advertisement volume has grown from Rs. 150million in 2001 to Rs. 400 million in 2003 to an expectedRs. 750 million in 2004. Forrester Research estimatesthat, worldwide, the online recruitment advertisingmarket will total $7.1 billion by the end of 2005.

A survey by monsterindia.com in 2002 revealedthat, on an average, the cost per hire, using traditionalmedia, including placement consultants, varies from Rs.25,000 per candidate up to Rs. 0.1 millon for seniorpositions. Online recruitment costs about 80 per cent lessthan newspaper advertisements and is about ten timescheaper than hiring consultants.4 For example, firms paybetween Rs. 0.144 million and Rs. 0.528 million on aquarter-page job advertisement in The Times of India.Compared to Indian job sites, those abroad charge muchmore; monster.com, for example, charges between $250and $400 per job.5 The cost of recruitment online can beas low as Rs. 1,500 — the cost of a single advertisementfor a week on a job site — in case a firm is able to findthe right candidate. One study by an executive recruitingresearch firm in the US found that using online recruit-ment cut the recruiting cycle from 90 days to 28 days,candidate identification from 30 to 70 days, interviewand assessment from 30 to14 days, and closing from 30to 7 days.6 Globally, recruitment is considered an ac-tivity involving advertising for positions, resume search-ing, profile matching, screening of applications, short-listing of candidates, counselling, client servicing, andreplacement.

There are five major ways of obtaining jobs in theorganized sector in India. The first and the largest categoryis the print medium where paid advertisements in generaland business interest newspapers and magazines domi-nate. Newspapers such as The Times of India (the largestdaily circulation English language broadsheet in theworld) and Hindustan Times can have an employmentsupplement on the weekend. At the low end and forgovernment-related jobs are outlets like Employment Newsand local language newspapers. Also in this categoryare trade magazines like Dataquest that carry sector-specific advertisements. The second major category isplacement and HR consultants that companies use formiddle and senior level placements. The third categoryincludes referrals and personal contacts, the fourthcategory has the online corporate web page of the firm,and the fifth and the fastest growing category consistsof online recruitment portal sites like naukri.com,jobsahead.com, jobstreet.com, and monsterindia.com.Apart from these categories, recruitment also takes placedirectly from college campuses and through job fairs.According to Arun Tadanki, CEO of monsterindia, reve-nues for online recruitment sites were 12 per cent of theaggregate revenues earned from print job advertise-ments in 2003 and this was expected to go up to 20 percent by the year 2006.7

An emerging competitor in the job recruitment spacewas the corporate website. An internet usage survey inthe US found that 91 per cent of Global 500 are usingtheir corporate websites for recruitment compared to 51per cent for www.monster.com, 43 per cent for www.hotjobs.com, and 22 per cent for www.careerbuilder.com.At the time of the survey in the US, the number of jobsavailable with the Fortune 500 corporate sites were 75,000compared to, approximately, 25,500 with monster, 13,200with careerbuilder, and 7,800 with hotjobs.

Newspapers were also moving into the online re-cruitment space aggressively to combat the erosion intheir revenues. For example, The New York Times runsthe Super Job Market online at www.nytimes.com/jobmarket promoting it as the largest print and onlinerecruitment opportunity available to the employers andthe job placement agencies in the tri-state area in the US.The Times of India uses its site www.timesjobs.com forsimilar purposes. Hindustan Times, another importantIndian newspaper, also has a widely read jobs sectioncalled HT Careers.

1 Business Standard, April 1, 2004.2 http://www.expressitpeople.com/20030414/cover.shtml3 Saxena, Vishal (2000). “Job on Hand,” Business World, December 11.4 http://www.expressitpeople.com/20021202/cover.shtml5 Saxena, Vishal (2000). op.cit.6 monster.com: “Beyond the Bubble,” Harvard Case # 9-802-024. 7 http://www.exchange4media.com/e4m/izone/izone_view.asp


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The HR consulting firms and placement agenciesare a major force on the recruitment market. Vipul Shah,head of Elixir Web Solutions, an HR consulting firm,claims that they are the No. 1 online advertisers on theonline job portals in India8 and that their firm has webstaffing specialists who are trained specifically for onlinerecruitment strategies and effective online job advertise-ment posting.

In India, recruitment has been the domain of the HRdepartment (and in some firms with the old nomencla-ture — the personnel department). HR departmentsstarted getting a separate E-recruitment budget in 2002;most HR departments did not have separate internetaddresses or services. A feature unique to the Indianmarket compared to more developed markets especiallyas naukri.com grows is that, in mid-2004, internet pene-tration in India was less than three per cent of thepopulation and the smaller towns tend to have a lowernumber of available machines for usage and a lowerlevel of familiarity with the internet. The calendar year2004 saw sales of about three million PCs in India.

Online job advertisements compete with the printmedium, reach being a major issue. For example, anadvertisement in The Times of India’s weekly pullout,Ascent, reaches over 2.5 million subscribers that trans-lates into a minimum of 12.5 million readers.9 In con-trast, the fixed line internet user population in India isestimated to reach 15 million users in 2007, with anestimated 25 per cent of them looking for jobs online.On March 31, 2004, there were 4.5 million ‘internetaccounts’ in India with more than 100 ISPs.10 Mobilephone subscription had exceeded 45 million by Septem-ber 2004 and the roll-out of General Packet Radio Service(GPRS) services pointed to the possibility of the use ofmobile devices as an additional medium for the onlinerecruitment business.

Despite the relatively high anticipated growth rateof online recruitment advertising market, a survey inOctober 2003 among a random sample of job seekers bythe HR consulting firm, Elixir, suggests that the onlineroute comes fourth (as a preferred job-hunting mode)after staffing agencies, print advertisements, and per-sonal referrals.

COMPETITORS

The three main competitors of naukri.com in India arejobsahead.com, monsterindia.com, and jobstreet.com.In early 2004, naukri.com had 50 per cent of the market,jobsahead had 32 per cent, and monsterindia.com hadnine per cent of the market in terms of job listings.11

jobsahead started operations in September 1999 withan initial funding from the Dalmia group and a laterfunding from ChrysCap of about Rs. 200 million. Itclaims that it has a database of three million resumeswith 4,000 new CVs getting registered everyday, 6,000corporate recruiters, and 150,000 advertised job open-ings. In 2003, Google rated jobsahead as the top Indiancareer website with 2.4 million registered job seekers and6,000 corporate clients. jobsahead had a turnover of Rs.150 million for 2003-04, a profit of Rs. 30 million, anda headcount of 135;12 it broke-even in 2002-03 with aturnover of Rs. 80 million. jobsahead used to power thejobs section of yahoo.co.in; currently naukri powers it.

In 2003, jobsahead launched two new databaseproducts, Marksman (a role-based matching technique)and Textstar (a text-based resume search) for a deepersearch facility for HR managers. Marksman allows firmsto search for their candidates by their current job roleor designation with over 23 categories and 600 roles.Through a deal with the Indian armed forces, jobsaheaduses the armed forces database of experienced technicaland management professionals through the Directorate,General Resettlement (DGR), that looks after the retiringarmed forces personnel. jobsahead also powers the jobsection of the horizontal portal, yahoo.co.in. Prior to itsacquisition by monsterindia in May 2004, jobsahead hadrun a nationwide campaign from February 18, 2004 toApril 14, 2004 in major national and regional dailies thatcost about Rs. 25 million.13 The jobsahead site lists jobsby sectoral category and by geographical location withpanels for major advertisers.

monsterindia is part of the monster.com, the pio-neer in online recruitment that started operations in 1994and is today the leading global career website with 43million unique visits during the month of March 2002.In the US, monster has also acquired the university site,jobtrack — now called monstertrack — that works with3,000 colleges and universities on their interview and

8 http://www.prweb.com/releases/2004/2/prweb105762.htm9 http://www.prweb.com/releases/2004/2/prweb105762.htm10 www.trai.gov.in

11 Sinha, Ashish (2004). “Is naukri.com Magazine Shutting Down?” TheEconomic Times, February 16, HT Careers and NFO-MBL India Study.12 http://www.ciol.com/content/news/2004/104052504.asp13 http://infotech.indiatimes.com/articleshow/521697.cms

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internship software.14 monsterindia has exclusive ar-rangements with Rediff.com and sify.com to direct traf-fic to the monster site. monsterindia had more than 4,000clients as on October 2004. Unlike naukri, monsterindiahad only six offices in India and obtained about 40 percent of its revenues through tele-selling. For example,while it had no offices in Gujarat, its client list in Gujaratincluded L&T and Voltas.

About 95 per cent of monsterindia’s client base isfrom the IT and business process outsourcing sectors.In 2004, monsterindia had a resume database that had900,000 resumes of which 3,000 were from foreignnationals seeking jobs in India.15 Worldwide, monsterhas over $100 million in cash reserves with approxi-mately 21 per cent profit margins. In May 2004,monsterindia acquired jobsahead in a deal worth Rs. 400million (US$ 9.6 million). The monsterindia CEO toldreporters that the merged entity would have a share of62 per cent of the 8.8 million people who visit a job siteevery month in India.16 monster’s MediaMetrix figures(Exhibits 2 and 3) suggest that monsterindia andjobsahead together have a higher traffic level than theirnearest competitor. Traffic statistics for the Indian jobportals as charted by www.alexa.com, an internet sitetraffic monitoring service, are given in Exhibits 7a, b.The combined entity to be called monsterindia wouldhave a headcount of 200 plus.

jobstreet.com was started in 1995 in Penang, Ma-laysia, as an online recruitment site to cater to the humanresource needs of companies in the Penang Free TradeZone. It has offices in Malaysia, Singapore, Philippines,and India; its Indian operations started in June 2000, andit has offices in Delhi, Mumbai, Bangalore, and Chennai.The Penang office was the headquarter with a researchand development facility for developing different web-enabled products required for the business. jobstreetuses its own proprietary software called SiVA thatincorporates all applicant tracking and processing al-lowing HR departments to reduce processing times.SiVA also provides filtering tools and automatic updatesto recruiters looking for particular profiles in job appli-cants. Like naukri.com, jobstreet has not used multi-million dollar advertising campaigns for much of itsexistence, preferring to make do with relatively less

expensive PR tools. On an average, the ratio of jobs filledto jobs advertised on the site tends to be higher forjobstreet.com outside India (23% in Malaysia vs. 9% inIndia). ICICI has also been a client for their campusrecruitment process that reduced hiring time.17

In sectoral terms, the software industry is the big-gest user of online recruitment advertising contributingabout 50 per cent of the online recruitments in India.18

In comparison, approximately 23 per cent of the jobopenings listed with naukri.com during the year 2003-04 were from IT and related areas (software, BPO, ITeS,hardware, networking, etc). Telecom-and FMCG-relatedfirms contribute another five per cent. In the post-dotcom meltdown period (2000-01), jobsahead, which wasgetting 90 per cent of its business from the IT sector(compared to 40% for naukri), took a greater hit.

GETTING THE BUSINESS

naukri.com used an India-wide salesforce of 170 distrib-uted in branch offices across 20 cities in India19 to obtainbusiness from recruiters. Initiated by Hitesh Oberoi,Director, Sales and Marketing, the salesforce was re-cruited and started functioning after venture capitalfunding was taken in April, 2000. The primary functionsof the salesforce were business development, pre-andpost-sales service, and relationship management. Branchexpansion went hand in hand with product portfolioexpansion. The sales and marketing function atnaukri.com was headed by Hitesh Oberoi who had joinednaukri.com from Unilever in 2000 when the turnover ofnaukri.com was Rs. 4 million (year ending March 31,2000).

The organizational structure of naukri.com and theposition of the salesforce is given in Exhibit 8. Ninety-five per cent of the revenue of naukri.com comes fromemployers who pay to put up job advertisements or toget resume-related services; the remainder comes fromservices provided to job seekers. The geographical dis-tribution of revenue sources is given in Exhibit 4. Thesalesforce used features such as functional advantages

14 Singh, Richa (2004). “You Acquire Companies to Give You a Boost,” BusinessStandard, July 28.15 http://in.jobstreet.com/aboutus/mreports43.htm, www.monsterindia.com16 http://www.onrec.com/content2/news.asp?ID=4195 (accessed August 16,2004).

17 http://www.blonnet.com/businessline/ew/2001/10/31/stories/0531e104.htm(The Hindu, October 31, 2001).18 http//www.exchange4media.com/e4m/izone/izone_View.asp (accessed Au-gust 16, 2004).19 By comparison, in 2002, Monster’s US operations had a salesforce madeup of 35 per cent of its 2,700 employees. The field salesperson was evaluatedon the number of new accounts, average contract size, renewal percentage,and new product sales. The telesalesperson was evaluated on the numberof new accounts, average order size, renewal percentage, number of outboundcalls, minutes of outbound talk time, and new product sales.


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in the RESDEX interface, ease of resume capture, advan-tages in speed of recruitment compared to newspapers,etc., to sell to the recruiters.

The Delhi and Mumbai offices together generated42 per cent of the total revenue in 2003-04. Taken to-gether, the Bangalore, Chennai, and Hyderabad officescontributed another 35 per cent of the revenue. Some ofthe smaller offices had started very well. For example,the Ahmedabad office, started in 2002-03, had deliveredmore than Rs. 4.3 million in terms of revenue during2003-04.

The sales personnel are typically hired from the Tier2 B-schools in India with a starting base salary of Rs.0.15 million per annum. Their transportation and cellphone expenses are reimbursed. The norm is to makea minimum of three to four sales calls daily. Initially,new recruits tend to make about ten per cent of theirbase pay as incentives; incentives, in turn, are gearedto the business that is brought in and is the same re-gardless of whether it is a new account or a renewal.Within six months, the successful salespeople startmaking as much as 100 per cent of their base pay asincentives.

The top salespeople make more than three timestheir base pay as incentives. However, the attrition ratefor salespersons tends to be high; at the entry level, asmany as 35 per cent of the new recruits leave within sixmonths. Those that survive and remain for more thantwo years tend to stay on. Attrition level for those whohave stayed for more than two years is less than sevenper cent. Over time, a salesperson becomes an AreaManager and then possibly a Branch Manager in a city.Nationally, salespersons have averaged Rs. 0.15 millionof business per person per month in the two quartersending June 2004; for the Delhi office, the figure is closerto Rs. 0.2 million per person per month. The salesforceper office varies by city. The Delhi office has 35 peoplehandling about 800 client accounts. The senior salespeoplehave the authority to negotiate rates that are differentfrom the official rate card within a prescribed band.

Performance leads to progress in the organization.For example, Swati Vashisht joined as a salesperson in2001 and is now an Area Manager in the Delhi office.She was first allocated Connaught Place in Delhi andthen Noida which was later subsumed into the Delhioffice. The next level up for her is the post of a SeniorManager. Allocation of territory is negotiated within thesales team and new recruits can lead to apprehension

that the potential in the area for each person will de-crease. Each salesperson has three lists to work on —existing clients, potential new clients that are beingcurrently contacted, and possible future clients that havenot been met as yet but are on the naukri.com target listfor the future.

Salesforce Compensation and Monitoring

Each frontline salesperson has a monthly base target, astretch target, and a jackpot target. At base achievement,he gets two per cent of the sale value as variable pay.At stretch achievement, he gets three per cent of theentire sale for the month as variable pay. At jackpotachievement, he gets four per cent of the entire sale ofthe month as variable pay. In addition, there is a superjackpot target for the quarter. If, in a quarter, the superjackpot target is achieved by the salesperson, then hisvariable pay already earned for the quarter is toppedup so as to be five per cent of the total sale value in thequarter. Sales are recognized and incentives paid outonly when naukri.com collects the money from the client.

How does this work in practice? Below the basetarget, a salesperson does not make any incentive. Forexample, if the base target for the month is Rs. 0.1 millionand the achievement is Rs. 75,000, the salesperson makesno incentive money. At base target level, a salespersonmakes 0.75 to two per cent of sales depending on theperson’s level within the company. A Junior Sales Exe-cutive would make two per cent while a Branch Managerwould make 0.75 per cent, the reason being that theBranch Manager has a much higher base. So, a JuniorSales Executive who achieves Rs. 0.1 million of sales ina month makes an incentive of Rs. 2,000. On the otherhand, the Branch Manager could have a base target ofRs. two million and would, therefore, make Rs. 15,000on achievement of his base target.

Continuing with the example above, the stretchtarget for the same Sales Executive might be Rs. 0.15million for the month. The Sales Executive would makethree per cent of the stretch target as incentive. A BranchManager, on the other hand, could have a stretch targetof Rs 2.3 million and make one per cent on the stretchtarget. So, if he does make Rs. 2.3 million, then he wouldend up making a total of Rs. 23,000 in terms of incentivesin that month. Similarly, the jackpot monthly target forthe same Sales Executive could be Rs. 0.2 million. In thejackpot, the Sales Executive would make four per centof the entire sales amount for the month.

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In addition to the monthly targets, there is also asuper jackpot target for the quarters. Typically, a superjackpot target is around three times the monthly jackpottarget + ten per cent. So, in the above example, the superjackpot target for the Sales Executive could be Rs. 0.7million for the quarter. The incentive at super jackpotis five per cent. Thus, if the executive ends up makingRs. 0.7 million in the quarter, he is entitled to a totalincentive of Rs. 35,000 in the quarter, which is Rs.7,000more than what he would have made in the jackpot(7L*4%). This helps take care of aberrations in anyparticular month and rewards consistent performance.20

Collections per month had been steadily rising andtouched Rs. 50 million in January 2005. Receivables werenegligible because more than 80 per cent of the paymentscame in before the advertisements were put up.

The monitoring of the salesforce is ex-post througha review of the daily call sheets that are submitted tothe corporate office. Daily call sheets are the indices formonitoring planning and productivity; at the beginningof the month, the salesperson gives a plan of how manycalls he is going to make with how many new accountsand how many renewal accounts to work on. In addi-tion, Hitesh Oberoi spends about 12 days a month onthe road with Bikhchandani spending about six days amonth on the road with different branches. Historically,everyone in the firm has been encouraged to sell to theclients. So, the CFO, Ambarish Raghuvanshi, for exam-ple, also goes to HR conferences where he sells to clientsand obtains client feedback.

On an average, a salesperson makes 65 calls a monthand spends 70 per cent of the time on renewal accountsand the remainder on new accounts. Exhibit 9 shows theworking sheet of a salesperson who has ten existingclients, 35 potential new clients, and 38 clients that hehas never met but are on his list. The sales and marketingcosts form 48 per cent of the annual revenues; this includesbranch rentals, conferences, sales training, salesforcecompensation, cell phone bills, and advertising. Thesalespeople also get a formal feedback from the clientson a feedback form.

In the last quarter of 2004, about ten per cent of theclients were placement agencies; they were providingabout 60 per cent of the jobs on the naukri site and 30per cent of the revenues. The placement agencies were

also providing approximately 70 per cent of the inter-view calls from the RESDEX database.21

Advertising

naukri.com began paid advertising from the year 2000.Previously, it had benefited from positive PR generatedby virtue of being the pioneer in the online area; it was,in fact, among the earliest sites in India in 1997. Duringthe year 2000-01, all the advertising was in the printmedia and was worth about Rs. one million. A one-offTV advertisement came from scrollers that were broad-cast during Euro2000 and the Sydney Olympics at abargain price from Pritish Nandy Communications. In2001-02, there was about Rs. three million worth paidadvertising in the print media. In each of its markets,naukri.com has also benefited from free space given bythe second newspaper in appointments advertising likeHindustan Times in Delhi and The Tribune in Chandigarh.The quid pro quo is that naukri lists the newspapers’advertisements free on its site, boosting their response,and helping them to compete with the No. 1 newspaperin the city.

naukri.com has also benefited from the ‘barter deals;’for example, it has done mailers for HR managers fortheir HR events based on the database of HR managersthat it has built up. In return, the firm for which themailer was done would ‘sponsor’ naukri.com at theevent — something that would otherwise have costmoney. Today, naukri still sponsors HR conferences andputs up stalls but has to pay money. Over the years, ithas built up a database of 100,000 HR managers.

naukri.com started its TV advertising on Englishlanguage channels from November 2003; it sponsoredthe statistics package during New Zealand’s test matchseries in India and also during the Australia-New Zea-land-India one-day series. In June 2003, naukri wasgetting 2,400 resumes per day; in August 2004, it wasgetting 7,200 resumes per day. During the financial year2003-04, it spent Rs. 20 million on TV advertising andmarketing — with a bulk of expenditure on TV adver-tising. naukri.com’s TV advertising appears on HBO,AXN, Zee English, Zee MGM, CNBC, and NDTV.

Exhibit 4 provides details of different marketingexpenses of naukri.com. Exhibit 10 provides a snapshotof the evolution of the marketing and advertising ap-proach from 2000 to 2004. On November 13, 2004, naukriadvertised on the India-Pakistan one-day cricket serieswith a view to further increasing the CV registration rate

20 E-mail communication, Hitesh Oberoi, Director, Sales and Marketing,September 26, 2004.21 Personal conversation, Sanjeev Bikhchandani, November 4, 2004.


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and awareness of naukri as the online recruitment firmof choice. As can be seen from Exhibits 1c and 2, differentsources have different traffic figures at different onlinerecruitment sites in India. According to Bikhchandani:

We buy media on a quarterly basis. We expectto spend around Rs. 50 million in 2003-04. Wehave produced one 30-second TV commercialand a 20-second edit that is being aired on 13English language channels (we believe that tobe on the net in India you mostly need to knowEnglish and so some or the other English TVchannel will reach you). We decide whichchannel to take depending on the deal we areable to negotiate. If we fail to get a good deal,we drop that channel. We are quite happy beingout of media for a while if we fail to get gooddeals with any channel. Some of the TV chan-nels we have advertised in the last six monthsinclude Star Movies, HBO, AXN, Zee English,Zee MGM, CNBC, and NDTV. 22

One way in which we are different is thatwe can measure the impact of an advertisementby seeing the blip in the number of CVs reg-istered on our site the day after an advertise-ment is aired. To this extent, we know whichadvertisement insertion and which channelworked for us and which did not. We measurethe effectiveness of a creative medium andmedia vehicle looking at the cost per CV ac-quired. For print, it is upwards of Rs. 200 andfor online and TV, it is Rs. 40 to Rs. 50.Hitesh Oberoi expected to put 30 per cent of the

advertising budget online and 70 per cent in TV during2003-04. Online advertising was on the major Indianinternet portal sites like Rediff, Yahoo, MSN, Indiatimes,and Samachar.

By comparison, from 1998, when the then CEO ofmonster’s US operations, Jeff Taylor, discovered thatwhile a-third of the traffic to the monster site was comingthrough the partnerships, the other two-thirds werecoming directly to the monster home page and there wasa strong incentive to reach individuals directly. In 1999,Taylor put the monster advertisement on the SuperBowl— the annual American football ritual that takes placein January with the largest number of eyeballs (120million to 140 million) on TV at any one time in the US.

The SuperBowl is, therefore, also a time and place wherecompanies spend astronomical sums (US$ 1-5 million for15-30 seconds) to advertise on TV; monster.com paid$4.8 million for a 30-second spot on the SuperBowl.Within a 24-hour period after the spot’s airing, searcheson monster’s site increased by 450 per cent. monsterhas stayed with the SuperBowl since then, and by 2003,was the only dotcom firm still advertising on SuperBowl.

PRODUCT PORTFOLIO AND PRICING

Employers are offered a variety of options on thenaukri.com site. Job listings are updated on a daily basis.

Job Posting Services for Employers and Pricing

Clients could post jobs in a number of ways on thenaukri.com site. The cheapest variety was the equivalentof newspaper classified listings which also had a ValuePack with a Job Alert service. The next higher categorywas the Hot Jobs with different periods of subscription.This has a higher visibility on the site. The Job Gallery’slisting of jobs on the site provided more space on thesite than Hot Jobs and had a microsite specific to theclient on the naukri.com site. The microsite enabled theclient to get some unique real estate on the naukri.comsite. The next highest category on the site was the ‘GreatPlaces to Work’ listing that did not require scrollingdown on the site; this also had e-Apps (applicationscreening service) provided as an additional benefit alongwith a microsite. The most prominent listings on the sitewere panel listings on the page that cost up to Rs. 1.2million per annum. The pricing for the different cate-gories of job listings for naukri.com is given in Exhibits11a and b.

naukri.com has attempted to maintain a presenceall across the product line with different price points fordifferent requirements. The main web page, naukri.com,contains a limited amount of screen space that is leveragedto provide the optimal amount of different product linesin the limited space; in this respect, this site is organizedvery differently from the monsterindia site and thejobsahead site (compare www.jobsahead.com,www.monsterindia.com, and the www.naukri.com sitesto see the difference). The job search on the home pagesearches all jobs in all types of listings on the naukri site.

The price points have evolved over time. In 1997,naukri simply copied job advertisements from newspa-pers and magazines to generate traffic to the site. By thefollowing year, once customers began to realize the value22 E-mail communication, Sanjeev Bikhchandani, September 14, 2004.

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of posting job advertisements on the net, naukri startedcharging firms to put up an advertisement. At that point,the only product was a simple job listing that cost Rs.350. Before naukri took venture capital funding in April2000, the price range of the products varied between Rs.350 (for the basic job listing) and Rs. 6,000 for job packswith associated services. In November 2004, the pricesranged from Rs. 475 to Rs. 1.2 million.

monsterindia charges Rs. 2,000 plus tax for a 60-dayclassified job advertisement posting on its site. A samplepricing plan for monsterindia for Target Reach job postingthrough their telesales representative as on October 1,2004 is given in Exhibit 12. This includes job postings24X7, live postings for 60 days after which the job postingneeds to be revalidated, company logo, no size restric-tions on the job posting, job alerts to suitable candidatesto drive traffic to the advertiser’s job posting, and aprotected log in interface. Another offering of mon-sterindia is to buy the resume database service for Rs.120,000 per annum (that gives access to both themonsterindia and the jobsahead resume database) withfree job postings.

By comparison, the Ascent series of classified jobadvertisements in The Times of India, India’s largestbroadsheet newspaper with a combined national circu-lation of more than two million daily, cost Rs. 2,200 (alleditions across all towns), Rs. 1,800 (Mumbai, Delhi,Pune, Bangalore, Chennai, and Hyderabad), and Rs.1,050 (Mumbai, Pune, and Hyderabad editions) for oneinsertion per square cm. of space on the newspaper.23

A typical job advertisement took about 3-4 square cm.of space in print. The Economic Times had lower ratesstarting at Rs. 850 per square cm. These classified news-paper advertisements were different from the displayadvertisements (with pictures) that had rates beginningat Rs. 2,400 per square cm. per insertion for the nationalpackage of The Times of India for one to two insertions,Rs. 2,300 per sq. cm. per insertion for three to fiveinsertions, and Rs. 2,200 per sq. cm. per insertion formore than 6 insertions.

Clients can be given accounts that they can use tolog in for checking the vacancies that they have put upand to update them, if required; they can be alerted ifa resume matching the requirements comes into thedatabase. Using the e-Apps service, they can manage thescreening process on the naukri.com site. monsterindia

allows recruiters and job seekers to manage the entireprocess online with space allocated to them on the monstersite.

According to Bikhchandani, informal conversationswith advertisers have led naukri to believe that averageconversion of job advertisements to actual jobs offeredhovers around 60 per cent. This, of course, differs fromsegment to segment with IT as a sector and work ex-perience between two to eight years having greatersuccess.24 In comparison, the profile at jobsahead shows42 per cent having work experience of less than two yearsand 33 per cent having experience between two and sixyears.25

The Resume Database

The RESDEX service launched in October 2002 allowsthe client firm to trawl through the resumes onnaukri.com’s database for the right match. With a resumedatabase of 2.5 million plus CVs organized by differentsectors, employers now had an additional incentive tocome to the naukri.com site. Employers buy access tothe resume database at prices given in Exhibits 11a andb. According to Bikhchandani, “the delay in getting theresume database up and running till October 2002 wasone of the biggest strategic mistakes that we made.” TheRESDEX service was frequently sold in combinationwith other products and was proving to be popular withcorporate clients; by January, 2005, it was contributingmore than 35 per cent of the total revenues.

By November 2004, the RESDEX service accountedfor 40 per cent of the naukri revenues; Hitesh Oberoiestimated the figure for jobsahead and monsterindiacloser to 80 per cent. monsterindia and jobsahead to-gether had a combined resume database (not allowingfor overlaps) of 3.15 million resumes in August 2004 witha monthly add rate of 150,000 resumes; all resumes areless than 18 months old.26 By comparison, naukri had2.5 million resumes in August 2004 with a daily add rateof up to 7,200. Employers could search resumes byqualification, degree granting institution, current salary,desired location, current company, and a host of othervariables and combinations thereof. The client interfacefor the naukri resume database search and that of thecompetitors is given in Exhibit 13.

23 The Times of India, Ahmedabad Office, telephone conversation, September14, 2004.

24 E-mail communication, Sanjeev Bikhchandani, September 14, 2004.25 www.jobsahead.com26 monsterindia


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Application Screening and Processing Service

Another service that naukri.com offers is the e-Appsservice that allows firms to screen resumes. A job ad-vertisement (whether print or online) may generate upto 5,000 responses that would, under normal circum-stances, have to be screened by the advertiser — a verycumbersome process. The e-Apps service offers screen-ing tools that allows the client to shortlist the CVs andhave only the best ten per cent forwarded to the firmwhich can then take a look at the ten per cent and decidewho it wants to call for an interview. Screening alsoenabled firms to create a customized questionnaire fora particular position that was automatically linked tothe job posting. Upon applying for a position, applicantswould have to complete the questionnaire. A trackingfeature enabled the employer to see where they were inthe hiring process. These products were all part of thee-Apps bundle that was offered to employers. Electronicscreening processes for resumes require job seekers totailor their resumes so that they are able to clear thisautomated bar.

naukri.com’s Print Edition

The print edition of naukri.com was launched in Feb-ruary 2003 with the aim of reaching potential employersand job seekers who did not have internet access. Pricedat Rs. 20, the 48-page weekly magazine had a print runof 10,000 copies in its third issue. According to Bikh-chandani, the purpose of this magazine was to expandthe product portfolio of the company and capture theshare of print recruiting advertisements as well. Eventoday, a dial-up surfer has to spend a hefty amount. AtRs. 20 a week, the subscriber can actually save money.The print edition did not do very well and has now beenscaled down.

Facilities for the Job Seeker

The job seeker can post his resume free of cost on thenaukri.com site in the following ways:• Public.• Confidential – his name and current employer are

withheld.• Private — No employer could review any data

through search but the seeker could send his resumeto selected companies.New job seeker services now guide job seekers

through cover letters, resumes, interview process, andby negotiating the compensation package; these services

are categorized under the rubric of resume services. Theinterested job seekers can be provided alerts when amatching job with the desired requirement (location,company, skill set, pay range, etc.) comes up. Whilerevenues from resume services increased from Rs 11.7million in 2002-03 to Rs. 17.1 million in 2003-04, theproportion of revenues coming from resume servicesdeclined from 13.6 per cent to 8.4 per cent.

In August 2004, naukri.com was developing itsversion ‘mynaukri’ that would enable the job seeker tomanage his/her resume and the entire job search processon the naukri.com site. The idea was to have all thefeatures that are available on the mymonster featurealong with many local adaptations that it did not have.

A monster metre poll (self-selected respondents) inearly 2004 revealed that while going to an online jobadvertisement site, job seekers consider ‘job description’as the most important factor (45%) followed by ‘thecompany’ (29%) in deciding whether or not to proceedwith a job application; ‘position title’ (19%) and ‘loca-tion’ (9%) were the other important factors that werecited.27 In November 2004, naukri signed an agreementwith Hot Jobs, the No. 3 job site in the US. Under theterms of this agreement, each would cross-sell job list-ings of the other and the revenues would be shared ona 60:40 basis.

The pricing of different naukri.com products in 2002and 2004 is given in Exhibits 11a and b. The differentproducts can be bundled together in different combina-tions according to the requirement of the client. Exhibit14 gives a list of the possible product combinations onoffer. The salespersons frequently come back with re-quests for new product combinations that then need tobe developed and implemented on the naukri.com sitebefore they can be offered to the customer.

New Product Development

A technology team that interacts with marketing andsales develops new products as the need arises. Bikh-chandani has followed a policy of paying 30 per centover the industry market rate for software personnel inorder to try to retain personnel in this area. People wholeave naukri.com tend to join industry giants like Wiproand Infosys. Vivek Khare and Vibhore Sharma head thetechnology team. In August 2004, the technology teamwas working on bringing mynaukri online before theend of 2004. The objective of mynaukri is to improve

27 http://www.expressitpeople.com/20021202/cover.shtml

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job seeker experience on the site by way of better nav-igation and improved features with a view to optimizethe time spent by a jobseeker on naukri.com, leading toan increase in applications online, improve response toclients in job posting, and obtain more updated CVs bygoing into the resume database. By December 2003,naukri had migrated from xbase and C++ as the under-lying technology for the product offerings to Php andMysql for greater flexibility and speed to market.

For example, the service would provide a promptfor duplication while applying for the same job; it woulduse different CV profiles for different job applications;it would allow the job seeker to see how many times hisCV was accessed in RESDEX by recruiters; it wouldarchive previous job alerts and would provide an smsservice icon; it would also have space for banners andthe naukri logo. A major difference between the ap-proach of naukri.com, on the one hand, and monster,on the other, was that naukri job advertising products(which recruiters used to post their appointment adver-tisements like Job Gallery) were present directly on thenaukri site unlike the design of the monster site whererecruiters and job seekers had to click further into thesite. In a survey conducted by naukri among the presentand the former clients, more than 66 per cent weresatisfied or very satisfied with the naukri site and itsofferings; however, the e-Apps offering was not popularwith many respondents stating that using the service didnot provide appropriate screened applicants.

In many ways, mynaukri would enable the jobseekers to manage their entire job search process onlinethrough the naukri.com site. jobsahead and monsterindiaalready had their versions, myjobsahead and mymonster,up and running. naukri.com now also owns the marriagesite, jeevansathi.com, which is now a division of thecompany.

Another new initiative from naukri, launched inNovember 2004, was the facility of letting job seekerssend their CVs to naukri.com on a word file. The naukrisite would then put the resume on the database andautomatically enter 12 key terms (name, companyworking for, post-graduate institute, computer program-ming language skills, job designations desired, etc.) fromthe job applicant resume into the resume database. Sucha facility would save job seekers from the task of goingto the naukri site and manually entering all the data intothe format of the naukri database. naukri expected thisfeature to increase the CV add rate to the naukri site from

an average of 5,000/day through the months to October2004 to more than 7,000 CV additions per day.

LOOKING AT THE FUTURE

From a humble beginning, naukri.com has now emergedas a leader in the online recruitment space in India. AsBikhchandani pondered over the challenges of growth,he kept coming back to the issue of whether the businesswas configured optimally for the next growth phase.naukri.com was on the track to achieve a turnover ofRs. 400 million for the year 2004-05 (together withQuadrangle, the executive search firm, InfoEdge wouldgross Rs. 450 million).

There were many issues that he needed to mull over.Was the salesforce still the main driver of businessgeneration as it had been since 2001 or was the naukri.combrand strong enough now to generate business withouta proportionate growth in the salesforce? With theexponential growth in the resume database, it was notclear whether the salesforce would have the same ‘ef-ficiency’ as before. An increasing percentage of therevenue was expected to come from sources other thanthe corporate clients using the recruitment services onthe naukri site. monster in the US was getting only abouthalf of its revenues from the corporate clients. Wouldthat pattern get replicated in India? What should be thechanges in the incentive, monitoring, and control mecha-nisms for the salesforce as the firm grew larger?

With rising penetration of online recruitment adver-tising, it was in the interest of the recruiters to advertiseon more than one online site — just as they wouldadvertise on more than one newspaper in order to gethigher ‘readership’ and generate more response. News-papers like The Times of India were also starting onlinejob advertising services called timesjobs.com. Howwould the RESDEX service change the nature of recruit-ment? With the November 2004 initiative, resume cap-ture was easier on naukri — how much of a differencewould this and the more customized naukri site make?

An immediate challenge was that posed by thepricing tactics of monsterindia. Subsequent to the acqui-sition by monsterindia of jobsahead, naukri had learntfrom its salesforce in Delhi that monsterindia was ap-proaching naukri’s clients with the proposition that theyshould advertise their job listings with monsterindia.For ten per cent more price than the corporate clientswere paying naukri.com, the clients would get job list-ings on both monsterindia and jobsahead. monsterindia


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also operated on a telesales representative basis that wasable to tailor products to the customer requirements andoffer customized products at a distance; for example, onesuch offering was the resume database with free jobpostings. The cost of acquiring a customer throughteleselling was lower. Bikhchandani was wonderinghow, if at all, he should react to this development. Deeperpockets meant that monster could sustain lower pricesthan naukri for a period long enough to gain substantialmarket share from naukri. Most customers still consid-ered naukri as the number one job site in India, evenwhile they bargained hard on price.

The larger issue was how to deal with the compe-tition now that monster had bought out jobsahead.com— with the combined entity having a market share ofresumes and jobs close to that of naukri.com. World-wide, monster was the largest online recruitment com-pany and a formidable competitor. monster’s annualspend on technology to upgrade and provide new web-based and offline services was more than naukri’s totalannual revenues and all the new services that weregenerated by the worldwide parent company wereavailable to the local affiliates/owned companies in theglobal template.

naukri

naukri

Exhibit 1a: Traffic at naukri.com and monsterindia.com as on August 16, 2004

Source: alexa.com, 2004.

Exhibit 1b: Traffic at naukri.com and jobsahead.com as on August 16, 2004

Source: As cited in Exhibit 1a.

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Exhibit 1c: Traffic Statistics for October 2004

naukri.com jobsahead.com monsterindia.comDate Reach per Traffic Page Reach per Traffic Page Reach per Traffic Page

Million Rank Views Million Rank Views Million Rank ViewsUsers per User Users per User Users per User

1 464.0 744 28.7 148.0 4802 8.6 136.0 5743 7.62 462.5 744 28.7 147.0 4802 8.6 136.5 5743 7.53 463.0 744 28.8 147.0 4802 8.5 137.0 5743 7.54 461.0 735 28.5 146.0 4832 8.5 137.0 5662 7.55 457.0 735 28.2 145.5 4832 8.5 137.5 5662 7.46 461.5 735 28.4 147.0 4832 8.5 139.0 5662 7.47 462.5 735 28.2 147.0 4832 8.4 140.5 5662 7.38 462.5 735 28.2 146.5 4832 8.4 142.0 5662 7.39 462.5 730 28.1 146.5 4779 8.4 143.5 5523 7.3

10 461.5 730 27.9 146.5 4779 8.3 144.5 5523 7.311 461.0 730 27.8 146.0 4779 8.4 145.0 5523 7.212 456.5 730 27.5 145.0 4779 8.4 144.5 5523 7.013 460.5 730 27.7 145.5 4779 8.4 145.5 5523 7.114 459.5 730 27.6 144.5 4779 8.4 146.0 5523 7.115 457.0 730 27.5 144.0 4779 8.3 147.0 5523 7.016 455.5 728 27.4 143.0 4759 8.2 - - -17 454.5 728 27.3 142.0 4759 8.2 148.0 5232 6.918 454.5 727 27.2 142.5 4828 8.2 147.5 5126 6.919 449.5 727 26.9 - - - 147.5 5126 6.920 452.5 727 27.1 142.5 4828 8.2 149.5 5126 6.921 452.0 727 27.1 142.0 4828 8.2 151.0 5126 6.822 450.0 727 27.0 142.0 4828 8.2 152.5 5126 6.823 449.0 724 26.8 141.5 4775 8.1 153.0 5017 6.724 - - - - - - - - -25 441.5 735 26.5 139.5 4773 8.0 153.5 4948 6.726 437.5 735 26.4 138.5 4773 8.0 152.5 4948 6.727 441.0 735 26.6 140.0 4773 8.0 155.0 4948 6.728 439.5 735 26.5 139.5 4773 8.0 156.5 4948 6.629 437.0 735 26.5 139.0 4773 7.9 159.0 4948 6.530 436.5 723 26.4 138.5 4779 7.9 159.5 4789 6.431 435.0 723 26.3 138.0 4779 7.8 159.5 4789 6.3

Source: As cited in Exhibit 1a.Note: Traffic statistics for naukri.com, October-2004 (3 months moving average).

Exhibit 2: The monsterindia Viewpoint

Source: MediaMetrix (an independent internet traffic auditing agency). * 10 lakh = 1 million.

Traffic Statistics for April 2004

Uniquevisitors

per month(in lakh)


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Exhibit 3: MediaMetrix Traffic Statistics

Total Average Total Total Average Average AverageUnique Daily Minutes Pages Usage Minutes PagesVisitors Visitors (MM) Viewed Days per per Visitor per Visitor

(000) (000) (MM) Visitor

Time Period: April 2004

Total internet: Total audience 39,231 15,310 32,107 60,126 11.7 818.4 1,533monsterindia.com 3,444 219 18 46 1.9 5.1 13monster.com 1,493 ... 6 8 ... ... ...naukri.com 2,666 242 105 152 2.7 39.6 57jobsahead.com 2,637 248 154 234 2.8 58.2 89jobstreet.com 1,121 ... 12 16 ... ... ...Time Period: May 2004Total internet: Total audience 41,154 16,050 37,875 73,000 12.1 920.3 1,774monsterindia.com 3,563 210 24 44 1.8 6.8 12monster.com 1,345 ... 3 5 ... ... ...naukri.com 4,374 247 102 117 1.7 23.4 27jobsahead.com 3,100 220 114 159 2.2 36.9 51jobstreet.com 1,672 ... 18 24 ... ... ...Time Period: June 2004Total internet: Total audience 43,171 16,811 42,355 78,234 11.7 981.1 1,812naukri.com 5,259 376 108 159 2.1 20.5 30monsterindia.com 4,512 302 58 115 2 12.8 26jobsahead.com 3,602 272 77 108 2.3 21.4 30Time Period: July 2004Total internet: Total audience 45,287 18,665 55,703 100,065 12.8 1,230.00 2,210naukri.com 7,769 745 263 367 3 33.8 47monsterindia.com 5,385 316 65 147 1.8 12.1 27jobsahead.com 3,847 327 118 149 2.6 30.7 39timesjobs.com 1,601 ... 6 30 ... ... ...

Notes:1. Data not adjusted for duplication.2. MediaMetrix has a panel size of two million of which 3,000 are in India.3. alexa has a global panel size of 10 million.4. Sometime in early 2004, monster began to route Indian traffic meant for monster.com to monsterindia.com.

Exhibit 4: Region-wise and Office-wise Revenues and Salesforce Deployment

Region 2001-02 2002-03 2003-04 Headcount Headcount Headcount2001-02 2002-03 2003-04

North Delhi 16.80 23.50 41.80 11 24 23Gurgaon 0 0 8.00 0 0 5Chandigarh 0 .46 1.71 0 0 3Jaipur 0 0 0.02 0 0 2Head Office 0 5.60 5.90 0 0 0

16.80 29.56 57.43 11 24 33East Kolkata 0 1.42 4.17 0 5 6

0 14.20 41.7 0 5 6West Mumbai 5.95 21.50 43.40 14 28 40Pune .94 6.70 15.30 4 7 10Ahmedabad 0 .65 4.40 0 3 5Baroda 0 .17 1.89 0 2 3Indore 0 .13 1.86 0 3 2

6.89 29.15 66.85 18 43 60SouthChennai 1.92 11.00 24.50 5 12 19Bangalore 1.74 9.86 34.10 6 15 26Kochi 0 0.05 1.43 0 2 3Coimbatore 0 0.08 1.67 0 2 2Hyderabad 0.54 46.10 12.90 4 7 9 4.20 25.60 74.60 15 38 59Total 27.89 85.73 203.05 44 110 158

Source: naukri.comNote: Office-wise revenue generated (Rs. million) between 2001-02 and 2003-04 with the headcount.

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Exhibit 5: Net Income, Salesforce Incentives, Marketing Expenses, and Personnel Costs of naukri.com (Rs.) (fromaudited accounts as on September 2004)

2004-05 (estimates) 2003-04 (Actual) 2002-03 (Actual) 2001-02 (Actual) 2000-01 (Actual)

Net income from operations 400,000,000 196,515,493 89,129,052 36,335,888 92,44,169

Sales incentives and commissions 25,000,000 16,692,945 6,554,792 406,714 Nil

Advertising 50,000,000 16,653,690 3,671,880 2,584,358 8,684,485

Other marketing and promotion expenses 10,000,000 3,292,163 1,003,441 1,525,022 2,933,509

Personnel expenses 80,000,000 60,619,262 32,840,113 22,821,623 9,184,736

Internet and server charges 20,000,000 9,352,727 4,561,641 1,782,986 1,627,505

Profit before tax 70,000,000 38,827,395 8,051,145 (11,415,756) (21,176,759)

Source: naukri.com audited accounts and estimates.

Exhibit 6: *Sales Revenue 1997-2004 (from the recruitment business) at InfoEdge (naukri.com + Quadrangle)

1997-98 1998-99 % 1999-00 % 2000-01 % 2001-02 % 2002-03 % 2003-04 % 2004-05 %

Q1 .037 .250 150 .479 92 2.263 310 7.5 362 18.7 249 44.5 238 99.9 224

Q2 .046 .333 233 .734 120 2.554 207 8.5 373 21.2 249 51.1 241 0 0

Q3 .074 .500 400 1.219 144 2.694 129 10.8 390 23.7 219 51.5 217 0 0

Q4 .086 .583 483 1.266 117 2.133 76 11.1 493 27.1 244 52.5 194 0 0

Total .243 1.666 3.698 9.644 37.9 90.7 199.6 99.9

*Exclusive of service tax.

Note: All figures in Rs. million.

Source: naukri.com.

Exhibit 7a: Traffic Statistics for naukri.com and Competitors (August 16, 2004)

Traffic Rank

Today* One Week Average Three Months Average Three Months Change

naukri.com 590 674 1,007 739

jobsahead.com 4,936 5,206 5,791 1,643

monsterindia.com 5,962 5,973 7,758 3,231

Reach per Million Users:

naukri.com 620 560 425 49%

jobsahead.com 160 155 153 23%

monsterindia.com 155 145 124.5 30%

Reach Rank

naukri.com 1,618 1,907 2,836 1,819

jobsahead.com 6,887 7,443 8,512 2,658

monsterindia.com 7,242 8,049 10,562 3,906

Page Views per User

naukri.com 30.0 29.0 28.1 11%

jobsahead.com 7.6 7.9 8.9 3%

monsterindia.com 5.9 7.3 7.9 7%

Page Views Rank

naukri.com 233 265 402 313

jobsahead.com 4,358 4,353 4,470 1,107monsterindia.com 6,084 5,255 6,028 2,994

Source: alexa.com.


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Exhibit 7b: Site Statistics for naukri.com and Competitors

naukri.com monsterindia.com jobsahead.com monster.com

Speed Slow. 85% of sites are Very slow. 98% of sites Very slow. 95% of sites Slow. 76% of sites arefaster. Average load are faster. Average load are faster, Average load. faster. Average loadtime: 3.7 seconds time: 7.6 seconds time: 5.8 seconds time: 2.9 seconds

Pop-ups Many. 69% of sessions Many. 12% of sessions Many. 14% of sessions Many. 13% of sessionshave pop-ups have pop-ups have pop-ups have pop-ups

Other sites thatlink to this site

662 222 341 18,908

Online since March 27, 1997 May 16, 2000 February 17, 2000 July 18, 1994

Traffic rank onAugust 16, 2004 1,007 7,758 5,791 160(3 months average)

Percentage of visitorsgoing to other sites 1% 3% NA 6%from the site

Source: alexa.com.

Sanjeev BikhchandaniCEO

Head - HRSharmeen Khalid

Head - Ops.Simeryn Jayadev

Hitesh OberoiDirector, Sales & Marketing

Vivek Khare & Vibhore SharmaTechnology Team

Ambarish RaghuvanshiCFO & Administration

Amitabh KapoorHead, Quadrangle IT

Search

RM (North & East) RM (West) RM (South) Marketing Quadrangle Mgmt.Search

Chandigarh Jaipur Mumbai Ahmedabad Bangalore Office Hyderabad Office

Gurgaon Noida Vadodara Surat Thiruvananthapuram Coimbatore

North Delhi South Delhi Pune Bhopal Cochin Vishakhapatnam

Calcutta Indore Chennai Office

Exhibit 8: Organizational Structure of naukri.com

Note: See also 'About Us' on www.naukri.com for further details of the management.

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Exhibit 9: Worksheet of Individual Salesperson

Sales Breakup for Q-1

Renewals Upgrades New Total

April 9,500 27,778 46,630 83,908May 9,500 27,778 75,906 1,13,184June 19,000 23,611 51,417 94,028

2,91,120

Q-2 RenewalsJuly Image Enterprises 9,500

Sprint RPG 9,500 19,000August Quintessence 20,000

Haemophilia Federation 14,000 34,000September Launchers 9,500

Saw Pipes 9,500 19,000

S.No. Existing Clients S.No. New Clients S.No. Clients Never Met

1 Ernst & Young 1 Expertease 1 Ericsson

2 Image Enterprises 2 Global Careers 2 Indian Express

3 Mayar India 3 IT Brainshapers 3 Egon

4 Team Computers 4 A J Placements 4 Hughes Network Systems Inc. US

5 Strategic Synerjees 5 Millennium Consultancy 5 Powergrid

6 Sprint RPG 6 Plus Placements 6 Whirlpool

7 Mass Placement 7 Ircon International Ltd 7 5 M Solution(Retention Team

8 RPG Cables 8 Mega Centre Solutions 8 Anything Mac Pvt Ltd.

9 Haemophilia Federation 9 Pragati Plastics Pvt Ltd 9 Apogee Technologies

10 Track Resources 10 Hi-Tech communication 10 Aurotel Communications

11 Swot Management Solutions 11 Bureau of Admissions

12 Executive Search Service 12 CAD Media

13 Boston Scientific 13 Dewsoft

14 Job Line Placement Co 14 Gillette Industries Ltd.

15 FORTUNE MANPOWER 15 HR 360

16 Orphic Resorts 16 Inderdjanis Production

17 RPG Infotech Limited 17 INTOUCH SOLUTIONS

18 net4barter 18 Jain Internet Ltd.

19 Trans Search 19 KAMAL INTERNATIONAL

20 Development Alternative 20 Kilbum Office Automation

21 Help Age India 21 Labindia Instruments Pvt Ltd.

22 Discovery Communication 22 LOCUS

23 Hyatt Regency 23 Paper Solutions

24 Arise Management Service 24 Prometrics

25 Millipore 25 Ravindra Sharma & Co.

26 SunLight Abroad Service 26 Seasons Production

27 CanSupport 27 Sinamas Pulp and Paper India

28 Barista 28 SPRINT RPG

29 Paramount Placement 29 STG INTERNATIONAL

30 ABB Lummus 30 Study Overseas

31 Wideconnekt 31 SUHRIT HYUNDAI

32 Blackshield 32 Super Med Scribe (P) Ltd

33 RPG Cables 33 Vigyan Prasar

34 Sitaram Bhartia Institute

35 Tara Crescent

Total no. of clients=10 Total no. of clients=35 Total no. of clients=33 Grand Total = 78


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1997-2000: The Beginning

Till 2000, when naukri.com took VC funding, the company operatedon a bootstrap basis with direct marketing activities funded fromongoing operations as the main marketing activity. From 1998 onwards,a small budget was allocated towards local level classified advertisingintroducing naukri.com's services for job seekers.

2000-2001: Total Advertisement Budget: Less than Rs. 10 Million

Armed with a sizeable venture capital investment of Rs. 80 millionand with the clear objective of taking advantage of being the first moverwith a high recall, marketing had a dual objective:

• Grow the business through a network of offices in key markets–Mumbai, Bangalore, Hyderabad, Pune, Kolkata, and Chennai.

• Reach a larger audience through a combination of print advertisingand television. Print advertising was restricted to local editionsof national dailies and TV was restricted to sporting events likethe Euro and the Olympics in 2000. This was the first time thatnaukri.com had advertised on a large scale. Also, there wascompetition from jobsahead.com who had started advertising.There was, therefore, a need to keep pace with competition.

2001-2002: Total Advertisement Budget: Approximately Rs. 2.5Million

With a network of expanding offices and a look at new markets insmaller metros like Ahmedabad, Indore, Baroda, etc., the focus wason regional tie-ups with publications. With a very small advertisingspend, naukri.com was able to reach out to new audiences throughthree key alliances–with the career supplements of Hindustan Times

in the north and east (HT Careers), The Indian Express in the westand north (Headstart) and Deccan Chronicle in the south (CareerChronicle). With the slowdown in the dotcom space, advertisingexpenditure was reduced. To reach recruitment and HR managers,events were also used as platforms to reach out to potential clients.

2002-2003: Total Advertisement Budget: Approximately Rs. 6.5Million

The focus this year continued on key alliances. As this strategy hadbenefited the company in the previous year, a great emphasis waspaid to this aspect and the alliances were extended to more newspapersand magazines that included Hindustan Times,The Indian Express,New Indian Express, Business Today, and Linux for You. To reach otherkey markets, naukri.com advertised in all the editions of The Timesof India with a shift to a national campaign for the first time away fromthe advertising that naukri.com had been doing at local/regional level.There is still no TV advertising apart from scrollers.

2003-2004: TV Advertising Begins:Total Budget of Rs. 20 Million

TV advertising debuts in a big way on different channels. FCB Ulkadeveloped the advertisement film that was and is being aired on HBO,CNBC, AXN, NDTV, Zee English, Z MGM, etc. The communicationactivity constitutes a mix of print alliances, television, radio, and alarge component is online advertising.

In October/November 2003, naukri.com sponsored the statisticspackage during the New Zealand tour of India for the test match seriesand also the Australia-New Zealand-India one-day series. Within 2-3 months of this activity, traffic doubled.

Exhibit 10: Evolution of Marketing Activities-1997-2004

Exhibit 11a: naukri.com Price Plans

Value Products Pricing

Product Rate in INR

Classified single listing 500Classified annual subscription (up to 1,000 job postings) 10,470Hot vacancies single listing 1,660Pack of 5 hot vacancies 8,265Pack of 10 hot vacancies 16,100Pack of 15 hot vacancies 23,150Pack of 20 hot vacancies 30,300Pack of 25 hot vacancies 37,470Pack of 30 hot vacancies 44,080Pack of 35 hot vacancies 51,250Pack of 40 hot vacancies 58,410Pack of 45 hot vacancies 66,120Pack of 50 hot vacancies 71,630Pack of 55 hot vacancies 77,140Pack of 60 hot vacancies 82,6501 month RESDEX Subscription(2 Simultaneous Logins) 16,5303 months RESDEX Subscription 38,5701 month Non-IT RESDEX search 13,775Hot vacancies and RESDEX–1 month 22,040Hot vacancies and RESDEX–quarterly subscription 66,120Hot vacancies with e-Apps-1 listing 4,410

Note: All prices in Indian rupee within India. INR 45=1US$ during 2004.Source: naukri.com.

130 NAUKRI.COM

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Exhibit 11b: naukri.com Price Plans

Mid-and High Level Products Pricing

Name of Product Product 2001- 2003-Variant 2002* 2004**

Job Posting ServicesBest places to work 1 month 43,200

3 months 108,0006 months 194,0001 year Starting 378,000

300,000Job Gallery 1 month 21,000 21,600

3 months 64,8006 months 113,4001 year 210,000 216,000

hotjobs Single listing 1,5753 months 21,000 27,0006 months 39,900 48,0001 year 78,750 81,000

Classified 1 year 9,975 10,260

Job Gallery with 1 month 26,250 27,000e-Apps 3 months 78,750 81,000

6 months 147,000 151,0001 year 262,500 270,000

hotjobs with e-Apps 3 months 39,900 42,0006 months 73,500 75,6001 year 136,500 140,400

Response ManagementSolutionse-Apps web-enabledapplication handling software 1 month 10,500 10,800

1 year 84,000 86,400Resume DatabaseAccess

Quarterly NA 27,000Half yearly NA 48,000Annual NA 81,000

* Prices valid from October 1, 2001 to March 31, 2002. ** Prices valid from August 1, 2003 to March 31, 2004.Note: All prices in Indian rupee within India. INR 45=1US$ during 2004.Terms

of payment: 100% in advance; service tax as applicable.Source:naukri.com

Exhibit 12: monsterindia Pricing Plan (October 2004)

Products/Service Country/Website Quantity Validity Amount - INR

monsterTarget reach job postings monsterindia.com Unlimited 12 months 15,000Logo on job postings monsterindia.com Unlimited 12 months 10,000jobsaheadJob postings jobsahead.com Unlimited 12 months 15,000

Grand Total 40,000

Notes: 40,000 only (Service tax 10.2% extra).Only monsterindia jobpostings= 25,000 + 10.2% service tax.Terms of payment: 100% advance.

Contd.


131

Exhibit 13: The RESDEX Product

Products/Service Country/Website Quantity Validity Amount - INR

monsterSmart find resume access monsterindia.com 01 license 12 monthsMOHQ monsterindia.com NA 12 monthsjobsaheadPremium resume access with text star — non-IT jobsahead.com 01 license 12 months

Grand Total 120,000

Notes: 120,000 only (Service tax 10.2% extra) for double power.Only monsterindia annual database membership Rs. 60,000 + 10.2% service tax.monsterindia database membership for 6 months=Rs. 36,000+10.2% service tax.monsterindia quarterly database membership=Rs. 19,800 +10.2% service tax.Only jobsahead annual database membership for Rs.90,000+10.2% service tax.jobsahead database membership for 6 months= Rs.54,000 + 10.2% service taxjobsahead quarterly database membership= Rs. 29,700 +10.2% service tax.monsterindia+jobsahead (double power) database membership for 6 months= Rs. 72,000 + 10.2% service tax.monsterindia+jobsahead (double power) quarterly database membership= Rs. 39,600 +10.2% service tax.

Source: monsterindia.com

Contd.

132 NAUKRI.COM

132

Contd.


133

Exhibit 13 (contd.): The Monster Resume Database Access Form

134 NAUKRI.COM

134

Exhibit 14: Recruitment Solutions from the naukri.com Product Portfolio

Arvind Sahay joined IIMA in June 2004 as Professor in theMarketing Area from London Business School. A B.Tech fromIIT, Kanpur, he has his Ph.D. from the University of Texasat Austin in Marketing Strategy and International Business. Hiscurrent interests are in the areas of high-tech marketing,pricing, international business, and marketing strategy. He haspublished many articles in refereed international journals likethe Journal of Marketing, Journal of International BusinessStudies, and Journal of Product Innovation Management. Hehas refereed and reviewed articles in journals and has written

several cases. He was awarded the University-wide OutstandingDissertation Award at UT, Austin for his thesis on “Role ofTechnology Licensing in Development of Product Strategy.”He was also the recipient of the Innovation in Teaching Awardat LBS. He has extensive consulting experience in the UK,the US, and India. He has been a featured speaker at theBusinessWeek Conference on e-business and at the All IndiaManagement Association.

e-mail: [email protected]

1. Classifieds (vacancy listing type #1)

2. Classifieds with e-Apps

3. Classifieds with RESDEX

4. Classifieds with e-Apps and RESDEX

5. hotjobs (vacancy listing type #2)

6. Resume database access (RESDEX)

7. Job gallery (hotjobs + microsite) - vacancy listing type #3

8. Best places to work (vacancy listing type #4)

9. Classified listing value pack (classified + job alert)

10. hotjobs vacancy listing + RESDEX

11. hotjobs vacancy listing with RESDEX and e-Apps

12. hotjobs + e-Apps

13. Manage your e-Apps account

14. Job Gallery (hotjobs + microsite) with RESDEX and e-Apps

15. Job Gallery with e-Apps

16. Job Gallery + RESDEX

17. Home page panel (vacancy listing type #5)

18. Print

19. Classifieds + RESDEX

20. Banners/Pop-ups

21. Home panel without e-Apps

22. Mail resume shortlisting with hotjobs

23. Mailers

24. Customized product

Broad Categories

• Classified listing is a simple listing in the classified section.Maximum characters permitted in the field are 255.

• hotjobs gives a listing in the hotjobs section; no characterrestrictions; it also provides a free classified listing and job alerts(job is mailed to the matching profiles in the naukri jobs database).

• Best places to work and Job Gallery give the client a link onthe home page, a microsite, a free hotjobs subscription (whichincludes all the features of hotjobs and classifieds).

An autobiography is only to be trusted when it revealssomething disgraceful. A man who gives a good accountof himself is probably lying, since any life when viewedfrom the inside is simply a series of defeats.

George Orwell


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Documents

Naukri.com Vikalpa