This association gives Cleartrip, Zomato and RedBus access to Snapdeal’s user base. In return, Snapdeal will earn a commission for each booking made through its platform. Air ticket is a large Gross Merchandise Value (GMV) category, while food ordering is a high frequency category.
“Horizontals are looking at monetising their user base with a focus on GMV and repeat use cases. As funding environment becomes tougher, growth in these metrics will stand out,” said a Snapdeal investor requesting anonymity. When contacted, Snapdeal declined comment.
Last year, CEO Kunal Bahl had told that the company will surpass Flipkart in terms of GMV by March, 2016. “Whatever their (Flipkart’s) numbers are, we will be ahead of them by March (2016),” he had said.
Recently, the company tied up with real estate developers such as TVS Emerald, Provident Housing and Runwal Group to launch real estate and financial services on its website, which boosts the company’s GMV.
The commission received on such transactions is not clear. GMV is the overall sales by merchants on an ecommerce platform, without factoring discounts, out of which an etailer gets 5-20% as margin on an average.
According to experts, ecommerce players are now experimenting ways to monetise traffic through non-inventory base model. “These are service oriented offerings, which won’t take up any extra cost in terms of physical space and, hence, these players will make better margin out of it,” said Devanghsu Dutta, CEO at retail consultancy firm Third Eyesight.
Snapdeal rival, Paytm, is also building a travel marketplace on its platform. The Alibaba-backed company had started selling hotel and bus tickets on the platform a few months back. “To provide everything on their platform, ecommerce players are now encroaching ideas,” said an investor.
“Flipkart, Snapdeal and Amazon are going the Paytm way of launching wallets and two years back, Paytm, a payments company, started tapping the ecommerce space.”
Source: The Economic Times