Times Internet acquires stake in logistics co

18 Jun,2012

In a move towards enriching customer experience and delivering quality service, Times Internet has invested in New Delhi-based logistics company, Delhivery to step up its last mile delivery for Indiatimes Shopping. Speaking to MxMIndia’s Shruti Pushkarna, Mr Gautam Sinha, Director- Technology & e-Commerce, Times Internet Ltd said that this acquisition is done to boost the delivery capabilities of the e-commerce vertical. He said: “After pivoting from a marketplace to a retailer model, we had to strengthen our warehouse network and last mile delivery. Some e-commerce companies in India are doing this by launching their own courier network, but that requires time to scale, hence we have decided to take the acquisition route.” Currently Indiatimes Shopping has Fedex, Bluedart, ASL and Aramex as its logistics partners.

 

Gautam Sinha joined the Times Group in 2007 as CTO, and is heading e-Commerce as well. He leads and drives the technology strategy, vision and execution for all the internet, mobile and telecommunication properties of the group. He has over 24 years of rich experience in technology innovation and execution, which includes a wealth of startup and industry expertise. Most recently, Mr Sinha was the COO/CTO of CashEdge Inc, where he worked since 2001 building and leading the company from startup to profitability.

 

Mr Gautam Sinha spoke about the recent investment in Delhivery given the importance of logistics and the focus area for TIL’s e-commerce business.

 

Can you throw some light on the strategic investment you are making in a logistics company?

Logistics is the key to any e-commerce player and there are multiple approaches a business can take. One is to build your own logistics company. Another approach is to work with third party partners, which we have been doing so far, and have strategic tie ups with one or more such partners. The third case is what we have done. Understanding the importance of logistics, we invested in a company which can have very tightly coupled systems and processes with us to make it work as if it’s your own company in-house logistics. That’s the reason why we invested in Delhivery. And this is just first of the series of investments and we are actually looking at multiple such investments.

 

Why this investment in logistics? Wouldn’t it better to outsource it?

We continue to outsource, so even with the investment, we are still outsourcing. They will execute the orders as an independent company.

 

How is Times Internet’s e-commerce doing?

We are doing very well. The growth has been on target and as per plan. We expect to grow another 100 per cent this year in terms of business. And we will be a credible player in this space. We used to be in the marketplace model, and we are pivoted to the e-commerce model, where we own the entire experience, right from warehousing to last mile delivery is owned by Indiatimes Shopping. Previously, this part of the experience was owned by the suppliers, which were on our platform; now we do end to end experience management for every business that we do.

 

There have been several e-commerce players that have come up in the last few years… especially in the lifestyle segment?

Indiatimes is a horizontal player. Our primary focus, as of today, is in the electronics, mobiles, computers, cameras, movies, music, books and games. The other category we are interested in is gifts. Although it’s true that a lot of players have come up in the fashion category recently, we don’t see a lot of impact on the business because of fashion as an industry.

 

Deals sites have been doing very well, as also classified sites like Olx, Quickr and so on?

They will continue to do well because there are a lot of people who are in the market for second hand products because of the price advantage. So Olx is a good place for buying used products. But if you talk of deal sites, they are typically in the services space, and only recently, a lot of them have started using products in terms of deals. For example, Snapdeal and Mydala are using more products in the deals space, but primarily they have been in the services space like spas, restaurants and so on.

 

Given the current environment, what are the steps you are taking to shore up revenues?

I think the market is growing at 60 per cent atleast and certain players are growing at 100 per cent or more. And the growth of the market is because of a lot of people converting from offline to online, the growing penetration of internet and the improved ability to brand yourself and deliver quality services. The first two are functions of the market, so our focus is on getting the repeat customers, so that the lifetime value of a customer is realized with the platform. So using that, we expect to grow at 100 per cent this year as well.

 

If you look at the revenue pie of TIL, how much of it is brought in by e-commerce?

See I can’t share this information, but I can tell you that e-commerce as a business is a focus area for TIL. We have put increased focus on it and that’s the reason you’ll see investments made by TIL in e-commerce in other players which are contributory to the ecosystem in the way we play in. So for example, Flipkart went ahead and built their own logistics network, we chose to invest, Snapdeal doesn’t want to do either, they want to outsource. For us, outsourcing but having a strategic relation was the right way to move forward. And we want to do it with more and more such companies so we can strengthen the ecosystem in which we play.

 

 

 

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