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Sep, 07 2011

Making a big deal online!

e-Commerce sites are opening new avenues for franchise brands that are queuing up online to tap the multi-billion industry. From oversize discounts to eye catching deals, the 'net connect' is doing wonders for the growth of franchise brands!

IT'S raining discounts! And to have a slice of this discount spree, consumers, too, don't have to run far and wide to their favourite retailer, as this is happening with a click of a mouse! With e-commerce sites catching up the fancy of a burgeoning web savvy population across India, brands are in no mood to let go of this opportunity. As per industry experts, despite poor internet penetration and sluggish internet speed, India had crossed the 100 million users mark in 2010. In 2010 the e-commerce industry was about USD five billion in India and it is estimated that this figure will touch USD 40 billion mark by 2015!

With the emergence and widespread acceptance of e-commerce sites like snapdeal.com, 99labels.com, fashion n you, yebhi.com, lootspot.com, the e-commerce scenario in India seems to be set for an explosion. Numerous national and international brands are queuing up for these sites to peddle their fare and franchise brands are at the top of this list. From beauty & wellness to food & beverage and apparel- you name it and the brand is there on these websites! Prominent names such as L'Occitane, Tress Lounge, Reebok, Cleopatra Day Spa, Pizza Hut, Domino's Pizza, Shahnaz Husain Signature Salon, VLCC, Chhabra 555 etc, are already making waves online.

Redefining discounts

Despite the fact that consumers are deprived of that 'touch-n-feel' factor while making an online purchase, how are these brands making thousands of consumers click the 'pay' button on their websites? Industry experts believe that discounts ranging from a minimum of 10 per cent to a maximum of 90 per cent make consumers snatch these deals in a jiffy. Enlightens Kunal Bahl, Co-Founder & Chief Executive Officer, Snapdeal.com. “Our model revolves around featuring attractive offers across various cities and then instantly notifying the growing eight million+ subscribers to purchase the deal from Snapdeal. The website acts as a platform to connect with customers, who want to explore new things and are ready to experiment. It's a free of cost service to end customers.” While Ishita Swarup, Co-Founder & CEO, 99 labels asserts: “99labels is an online event-based shopping portal that features flash sales of premium fashion and lifestyle brands at deep discounts of up to 90 per cent off. The site is positioned as a member's only shopping club and gets around seven new Indian and international brand's sales everyday. Customers pay online or on receipt of goods through 'cash on delivery' and all stages of the buying process are secure and user friendly.”

Snapping a deal

‘Going Going Gone’ is the buzz that's whizzing across e-consumers as well as the franchise community. What's so special about these sites, which is making franchise brands huddle up there? Shahnaz Husain Signature Salon has been on Snapdeal.com and Shafaqh Khan, a franchisee in Chandigarh, shares her experience: “It's a good and highly beneficial media to get information. As far as branding is concerned, Shahnaz Husain, as a brand, needs no introduction! But in today's world, to grow a business one needs right connections and networking and Snapdeal has helped me a lot.”

While Richa Aggarwal, Director, Cleopatra Chain of Day Spas, sights that several patrons who have taken up deals from e-commerce websites have rolled in as permanent members. She quips: “There are many people who feel spa is expensive, so deals on the Internet are an effective way to convey that spa is affordable. Also, many people want to try this service, so they can make the most of online deals. This helps in high conversion rate, which is good for a brand as well as for a franchisor.” Likewise, Munish Bajaj, Executive Director, Tress Lounge, zeroes in on the benefits of both the franchisor and franchisee: “With the world going tech-savvy, there is an increasing tendency of the youth and educated taking up coupons from these e-commerce sites. Participating here adds up to a brand's online visibility as well as client's pull, which in turn is a win-win situation for a franchisor and a franchisee.”

As e-commerce sites go on creating a stir in the franchise community with their emergence as a new-age multi-channel benefit platform, Bahl says: “For franchise brands, besides being a cost-effective channel to acquire new customers, it works as a risk-free alternate marketing channel for businesses. The advantage of associating with Snapdeal.com is that merchants can measure the effectiveness and spend only on the prospective clients rather than spending in traditional forms of media, which don't guarantee returns or customers. From the retailer's standpoint, they are passing on the customer acquisition cost in the form of a discount offer.” Likewise, Swarup agrees: “Franchising helps in increasing the reach and visibility of a brand to relevant audience across geographies in an economic fashion. Portals such as ours prove to be an optimum solution for brands to have a pan-India reach at low costs. We deliver pan-India for all product categories and worldwide for a select few.”

Up next?

As consumers make a bee-line to avail massive discounts through these websites, it's franchise brands that are making their way to cash registers! As Khan asserts: “My suggestion is that franchisees/franchisors must tie-up with e-commerce portals to increase their business and clientele, as it is lucrative as well as beneficial.” While Bahl comments on the amasing success of brands: “Almost every offer that is showcased helps a brand to gain thousands of customers. Some of the national brands like Domino's Pizza, Pizza Hut, Levi's, Reebok, Carnation etc. have all seen success through this channel where they were able to gain 10,000 customers in a few days.”

With high traffic on the Internet, 'saturation' is feared in the times ahead. Thwarting any such fear, Swarup sums up on a positive note: “There is still tremendous scope for investors and entrepreneurs in India's e-commerce space. It has been overwhelming for promoters of 99labels, as the website has been well received by the masses. A membership base of over five lakh and around 30 per cent MoM (month-on-month) growth bears testimony to this.” IT'S raining discounts! And to have a slice of this discount spree, consumers, too, don't have to run far and wide to their favourite retailer, as this is happening with a click of a mouse! With e-commerce sites catching up the fancy of a burgeoning web savvy population across India, brands are in no mood to let go of this opportunity. As per industry experts, despite poor internet penetration and sluggish internet speed, India had crossed the 100 million users mark in 2010. In 2010 the e-commerce industry was about USD five billion in India and it is estimated that this figure will touch USD 40 billion mark by 2015!

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