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Peshwa Acharya www.Peshwaacharya.com thePeshwa@gmail,ckm Chief Marketing Officer - Sterling Holidays ( Thomas Cook & Fairfax Company ) Founded : Thinkasconsumer.com, EazyFriday.com, Rocketperks.com , Leven.co.in . 1 Peshwa Acharya

Session on digital transformation , chennai summit Aug 2016

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Page 1: Session on digital transformation , chennai summit Aug 2016

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Peshwa Acharyawww.Peshwaacharya.com

thePeshwa@gmail,ckm

• Chief Marketing Officer - Sterling Holidays ( Thomas Cook & Fairfax Company )

• Founded : Thinkasconsumer.com, EazyFriday.com, Rocketperks.com , Leven.co.in .

Peshwa Acharya

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COMPANY

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Brands Built

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The Digital Transformation of BusinessThe concept of Uberization

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Content is King

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e-Commerce Inflexion Points

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e-Commerce is still Commerce

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Platform Creation

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Omni Channel

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App v/s Web

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Social Stores

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Future is AR/VR

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Chat Bots

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Appropriate Technology

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Offline v/s OnlinePromo v/s Persuasion

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Digital Native Generation

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Digital Transformation in Travel Industry

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Digital Transformation in Logistics

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Value Creation• Taxi business is extremely disorganised

• Ola, Uber, TFS and other competitors aim to organise this sector

Disorganised Value Creation Organised$

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Bridge the Gap

Demand Supply

Tech

nolo

gy App

Website

Call centre

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Uberization

• Ola doesn’t own any of their taxis• Prevents unionization, insurance and maintenance and asset

depreciation• Very ‘asset-light’

Utilising Uber’s business model

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UberizationBenefits:• Prevents depreciation• Reduces maintenance and running costs• Prevents unionization• Incites an entrepreneurial spirit

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Housing

Peshwa Acharya

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24$180 billion (INR 1.12 Lac Cr) Industry : CAGR 19%

Market Size of Real Estate in India ( $billion)

Real Estate Industry Size In India

As Per Google Study

Peshwa Acharya

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Role Of Internet In Buying Decisions

ZMOT is now a reality in online Real Estate buying Peshwa Acharya

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Emerging Trends in Indian Real Estate

Internet influence on real estate transaction value amounts $43bn i.e. approx 40% of market

The expected internet influence CAGR in 2014 is 25%

Listings in top 50 cities were 2 lakhs (’12), 5 lakhs (’13) and 14 lakhs ('14)* growth of 250%

Influence of internet is rapidly increasing in Real Estate because of convenience & greater options

As Per Google Study

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Role of Internet in Real Estate

Internet is a key influencer in Real Estate Research As Per Google Study

Peshwa Acharya

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Offline to Online Value Migration in Real Estate Business

SOUFUN (CHN)Revenue : $638 mn CAGR : 50% Valuation : $4.2 bn

Online Real Estate Revenue Market Size:US : $1.5 bn UK : $ 750 mnChina : $850 mnAustralia : $500 mn

India Online Real Estate Revenue market size : $80 mn …. On The Cusp Of Explosion

RIGHTMOVE (UK)Revenue : $210 mn CAGR : 20% Valuation : $4 bn

REA (AUS)Revenue : $300 mn CAGR : 20% Valuation : $5.9 bn

ZILLOW (US)Revenue : $350 mn CAGR: 69 %Valuation : $6 bn

As Per Google Study

Peshwa Acharya

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Who

-Website Tour

How we do it: -https://www.youtube.com/watch?v=_gVDIYxzVp4

Platform which connects Buyers and Sellers for their

Real Estate/Property Needs

Peshwa Acharya

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All India Figures

Housing - 2X better in each parameter that matters

Peshwa Acharya

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E-COMMERCE IN INDIA Growth drivers for ecommerce — growing internet users

Source: KPMG

he words ‘retail therapy’ or ‘goingshopping’ were long associated withphysical, brick-and-mortar retail. ButTwith stores and brands going

clicky(websites) and appy (mobile apps) these terms have already widened to accommodate online shopping. Over the last couple of years, the Indian ecommerce space has filled up with home- grown players such as Flipkart, Snapdeal, and the big daddy of ecommerce, Amazon. Online shop- ping has captured the imagination and attention of consumers, media, brick-and-mortar players, brands, and of late, even the tax authorities and the government.

Various studies estimate Indian ecommerce to be about US$ 3bn as of now, which is just 0.8%

of the Indian retail market. However, this share is expected to increase rapidly as more people shop online. Of the 200mn people in India who access the internet, 28-30mn (less than 3% of India’s population) shop online. However, this number can move up to touch 100mn by 2015 and a whopping 200mn by 2017, which is the same as the number of Indian internet users in India today. Nitin Bawankule, Director, Google India Ecommerce, says that, “Even now, there at least 200mn people who can purchase online in India”. The market is redefining itself rapidly as etailers advertise, reach out, and offer deals and discounts to consumers.

So how big is the Indian Retail market?

During GOSF 2013 (held over three days in December 2013), over 60mn people visited online shopping sites and 16mn unique customers shopped at the event. Myntra.com claimed that it made over 100,000 shipments for orders placed in those three days.

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Drivers of e-biz models: opportunities and discounts galore

Current online spending

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What are Indians buying online?

Share of overall retail market, 2013

Online retail market-Category break-up (by value), 2014

Jabong has had the number of its unique visitors double in the last 2 years

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Jabong’s category wise revenue-mix

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Reports said that Flipkart sold over half a million mobiles in just one day on its Big Billion Day sale on 6th October.

Number of SKUs on offer by Flipkart

Large number of SKUs on offer

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India’s online market comprises of various players with different models. Players that retail pretty much everything from electronics to FMCG products follow a version of the ‘marketplace’ model. Amazon and Snapdeal operate on this kind of a model where their role is to facilitate the sale and fulfil it — that is handle logistics, deliveries, and returns. In this mod- el, the portals do not hold any inventory on their books. Flipkart used to operate on a hybrid model, where it held its own inventory and also acted as a

The categories, the major players, and business models

marketplace. However, it has now moved to a mar- ketplace model, albeit with far lower sellers/vendors than Amazon or Snapdeal, since WS Retail (erstwhile Flipkart group company) still contributes a significant portion of its sales. Vendors and sellers usually sign up with these marketplace online retailers for a fee, depending on the category.

Players such as Myntra and Jabong, which are primarily apparel portals, have an inventory model. They have moved to a hybrid market place, but it is still skewed towards the inventory-led model.

Number of SKUs on offer by SnapdealMobiles is a major

category here as well

Vendors and sellers usually sign up with these marketplaceonline retailers for a fee, depending on the category.

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Online retailers: Different operating models

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As one of India’s largest retailers puts it, “If it were netof any of these discounts then it should be called net merchandising value not GMV.” “If you don’t want a good price, we will still offer you a coupon.”

Website traffic for Indian e-commerce websites and product offeringPortal Alexa

Rankings for India

Categories Model No of Registeredusers (mn)

No of products on offer (mn)

GMVRs mn)

Flipkart.com 5 Electonics, Apparel, Accessories, Footwear, General Merchandise, FMCG

Marketplace 22 15 15,000

Amazon.in 7 Electonics, Apparel, Accessories, Footwear, General Merchandise, FMCG

Marketplace 15 17 na

Snapdeal.com

10 Electonics, Apparel, Accessories, Footwear, General Merchandise, FMCG

Marketplace 20 5 30,000

Jabong.com 14 Apparel, Footwear and Accessories Hybrid 2.9 0.139 5,114

ebay.in 16 Electonics, Apparel, Accessories, Footwear, General Merchandise, FMCG

Marketplace 2.1 NA na

Myntra.com 30 Apparel, Footwear and Accessories Hybrid 1mn 0.05 4,000

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Key developments in 2014The last year has seen several developments that have given a fillip to the eCommerce industry.

Mobile to be the most influentialaspect of eCommerceWith mobile apps being developed by most eCommerce websites, smartphones are increasingly replacing PCs for online shopping. In 2013, only 10% of the mobile users used smartphones, and only 5% of the eCommerce transactions were made through a mobile device. This figure has more than doubled, and more than 13% of all eCommerce transactionstoday happen via mobile3. According to some industry players, over 50% of the orders are being placed through mobile apps, whichis not only leading to substantial customer acquisition but also building customer loyalty for various brands. However, most mobile transactions so far are for entertainment, such as booking movie tickets and music downloads. This trend will change soon with more and more merchandise being ordered online.

More business coming from smaller towns

eCommerce is increasingly attracting customers from Tier 2 and 3 cities, where people have limited access to brands but have high aspirations. According to eCommerce companies, these cities have seen a 30% to 50% rise in transactions.

Enhanced shopping experience

Besides general online shopping, customers are also shopping online for weddings and festivals, thanks to wider range of products being offered and aggressive advertisements. The free and quick shipment and wider choice of products, along with the ease of shopping online as compared to in-store shopping, is also helping eCommerce gather momentum.4 Further, eCommerce companies are doing rapid business due to sales.

New concepts such sales on weekends, holidays and festivals are attracting a

3 IAMAI-IMRB

lot of new customers and building customer loyalty among existing customers. Television and social media, particularly Facebook, are playing a proactive role in promoting eTailing through aggressive advertisements. This has helped several eCommerce companies build substantial brand image.

4 Outlook 15: What Indian niche e-commerce companies plan to do in 2015, Medianamahttp://www.medianama.com/2015/01/223-outlook15-niche-e-commerce/

Peshwa Acharya

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Exclusive partnerships with leading brands

Over the year or so, there has been a trend of exclusive tie-ups between eTailers and established boutiques,designers, and high-end lifestyle and fashion brands. For instance, in 2014, Jabong added international fashion brands such as Dorothy Perkins, River Island, Blue saint and Miss Selfridge, along with local fashion brands through Jabong Boutiques. Similarly, Myntra benefited from exclusive tie-ups with brands such as Harvard Lifestyle, Desigual and WROGN from Virat Kohli.

Expanding the product basket

There is a recent trend of relatively newer products such as grocery, hygiene, and healthcare products being purchased online. Similarly, lingerie and Indian jewellery has also been in great demand among customers outside India. Export comprises 95% of cross-border eCommerce, with the US, UK, Australia, Canada and Germany being the major markets.5

Key market factors to be evaluated before entering a new eCommerce business

To achieve their vision, eCommerce companies will need to understand the intricate landscape of new markets in addition to their own internal capabilities and limitations. The following factors must be considered:

• Market size: Before moving too aggressively into a new market, it is important to consider how sizable the overall opportunity is.

• eCommerce readiness: It is essential to fully understanding the payment and logistical infrastructure, consumer behaviour, retail opportunity and technological developments.

• Scope of growth: It is also important to look at the internet penetration, demographics of the online buying population and understand which phase of development each market is in.

• Barriers to entry: Players should understand the regulatory environment and connect with solution providers, content distribution networks, and digital agencies.

• Competition: There is also a need to do an in-depth assessment of what competitors are doing, their online strategy and the nature of each offering.

4 The Paypers, Netherlands-based leading independent source of news and intelligence for professionals in the global payment community

Peshwa Acharya

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BUILDING NEW BRANDS

PESHWA ACHARYA

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PESHWA ACHARYA | Brand journey

• CMO – Sterling Holidays (a ‘Thomas Cook’ company ) • Former CMO – Reliance Retail, Housing, Reliance Mobile , Vodafone• Founded : Leven , Rocketperks, EazyFriday , Think As consumer .

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Pointers 1. Tricks to Building young ‘Challenger brands’2. Brand Communication is dead .It is all about Brand Experience . 3. Identify Offline online convergence

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The Power of Platforms

Changed the way we socialize

Changed the way INDIA shops

Changed the way we search

Changed the way INDIA travels

Changing the way we do Real Estate

As Per Google Study

Valuation $341 bn

Valuation $212bn Valuation $19 bn

Valuation $2 bnValuation $11 bn

Valuation $ 150 mnValuation $ 1 bn

Valuation $250 mn

Platforms Command ValuationPeshwa Acharya

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MODULE 1

Challenger Brands

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ARIEL Detergents

Challenging established players like RIN & SURF, the brand was able to quickly garner market share with its innovative product launches and marketing campaigns• Launched ‘Testimonial advertising’ with Regional Voices• Launched a LPU Sachet SKU• New Concept: Ariel microsystem= Detergent bar + Powder + Blue

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BABOOL Toothpaste

A relatively new player in a market dominated by Colgate, Cibaca etc, Babool launched a fighter SKU at Rs 5 and was able to increase market share from around 4% to 7.8% in less than a year (1 percentage point = 25r)• A Rs 5/- LPU Tube pack: First time in the Oral Care market• Innovative promos: 1+1 Offer, Toothbrush bundled offer• Geographic focus in rural semi urban

https://www.youtube.com/watch?v=f-btqaJ40RI

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RELIANCE Mobile

Fighting in a cut throat competitive market, Reliance Mobile focused on DATA as a key differentiator along with actress Anushka Sharma as a celebrity endorser to increase its market share, also helping create a ‘Younger’ brand positioning .

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HOUSING.com

In a market dominated by Magicbricks, 99acres etc- campaigns focused on ‘House hunting’, Housing launched a different campaign with ‘Optimism’ as the theme and was able to move the goalposts.

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MODULE 2

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RELIANCE DIGITAL, from Reliance Retail became India’s biggest Electronics Retailer by focusing on 3 consumer experience segments:1) Reliance Digital: Offering a large retail store experience2) Digital Xpress: A personal experience with ‘Experience Zones’ inside3) DX Mini: A small neighborhood Mobile & Accessories store

RELIANCE DIGITAL

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APPLE

APPLE, widely recognized as among the world’s best marketers, create a differentiated experience inside the Apple brand stores where customers can experience the brand and its innovative products themselves without any assistance

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INDIGO Airlines

INDIGO Airlines attacked a big impediment associated with Air travel- ‘Flight delays’ and focused painstakingly at being punctual. They also coined a term ‘Indigo Standard Time’ to communicate this claim effectively

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The Oberoi hotels, known for their ultra luxury hotels, offer a personalized experience to their guests in the form of a personal guide to maintain a unique and luxury brand experience vis-à-vis other luxury hotel brands

Oberoi Hotels

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MODULE 3

Omni Channel Integration

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HOUSING.com Centres

HOUSING.com a primarily digital real estate search portal, extended their services through an Offline channel ‘Housing Centres’. At these retail outlets located mostly in Tier2 cities, customers can visit and get an experience similar to the online portal as well as coordinate with Brokers, Builders etc

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LENSKART

Lenskart, a successful e-commerce brand in eyewear, launched their own retail stores for customers to try glasses and get their eyes checked. These stores also double up as delivery & pick-up points for online orders if the customer so wishes

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APPS DAILY

Apps Daily, an App brand turned the practice of App downloads on its head by launching consumer packs containing app links and selling them across the counter through Consumer Electronics retail stores