I tried to order one veg biryani from them (they are about 1 KM from our office) at 7:30 PM and they said, No, we won’t do it. I said, wait, last week you had done it and few weeks before that too but that guy firmly said, No, we won’t do this time unless the minimum order is Rs 150 (my order was of Rs 98 including the delivery charges). It seems, whether they will deliver it or not depends highly on who is attending the call and what mood he is in. The person in charge also failed to figure it out that the delivery boy in any case will pass from our office (it is on main road) to deliver to others so effectively by repeatedly asking me to make a minimum order rather then being flexible, Hyderabad house lost a customer (I am assuming their margins are above 50% so they lost the money too by not taking my order).

Businesses in India, specially non online, needs to understand the importance of converting every call to sale irrespective of profit margins.

This is the email I got today (I get 3 such emails daily)

Hello,
I am Priyanka Marketing Executive. (what?)

We have a SEO discount offer going for the following package: -

**Long list of some random stuff**

Our Best rates for this: – USD XXX per month per project at beginning of every month.

This Discount is Valid till August 31th 2011 (well but today is 5th September, Do’h)

Please let us know in case you are interested.

Warm Regards,
Priyanka

So Priyanka just copy/pasted the email without even reading it whether it is even making any sense. now since the email was sent from priyankaseoxx@gmail.com, I am assuming priyanka (or priyank) is sending these mails manually which is such a huge waste of time considering I can bet s(h)e is not going to get a single reply with these emails. This is not even spray and prey, this is just “begging and prey”

So the question is, what such people and such micro companies of India can do to look more presentable and acceptable to potential client ? The answer is simple, Think from the Clients Point of View (it is common sense but everyone fails to do this as we think we are smarter then the client and knows best for him). If you see the above mail, the person is just hard selling it without even realizing what he is selling and whether the recipients even need it ? the price also seems to be ridiculous (you should never mention the price in such emails, nor should write such lengthy unsolicited emails). And last but not the least, never send a business mail from gmail id, you are not running an online B2B business if you are using free service providers.

In this post, I am going to write down what I feels, types of Ideas which are/will work in India. This is a casually written post with no research done and is based on my 7 years “hardcore” net knowledge

In India, we can categories successful web companies into 4 categories and I feels for next few years, all new successful ventures will come only in these 4 categories

1. Aggregators i.e. those sites who are aggregating information
2. Copy ideas from US web space (or from any other country)
3. Get offline to Online
4. Classified content like matrimony, jobs, buy/sale cars, houses etc
5. Solving some real problem (very painful to implement + not much money)

1. It is something which we are all seeing on Indian spaces, specially in travel industry. Aggregation works so well in India because Indian we space is still very immature and content is very fragmented, even the well organized site like nic.in seems to be very fragmented to me, lot of information but scattered, so if you can offer a service which aggregates useful data and information, the company can be huge success. Few ideas are, Government inquiries, PAN Card/passport/ration card, Exam results, Reviews etc

2. People are copying each other from the beginning of Internet, anything which works in USA normally gets copied to UK, Australia, India, South America and other european countries. A business model which is already tested in other country will always be successful in any other part of the world provided it is web based. Here is what I feels, Indians should look into other countries too to copy ideas, specially countries which have similar economy and people, for e.g. Brazil and China can be perfect countries from where Indian entrepreneurs can “take” ideas as the ideas from US normally gets copied very soon. I had explored China market in 2009-10 for brief period though couldn’t find much to implement in India, though I will highly advice people to look into China, Brazil, Korean, Russian and Mexican market for ideas.

3. Coupons, all kind of ticket booking, ecommerce and everything which is happening offline can be bring Online. I strongly feels, “anything which Internet has not touched will be eventually get touched by internet for good” (I read this on cdixon.org’s blog, please please read all his blog posts, its all gold!) so in India, find the pain points, things which people hate to do but are still compelled to do because of lack of online option and implement that.

Personally, I love these kind of ideas most as they are solving some pain which means you never have to spend much on marketing, Indians love to talk and will talk about your service if it is good. Paying online bills is a great idea which I wanted to do but this has alrady been done by ICICI in 2000 though done very poorly.

4. From 2000 onwards, all the classified sections were moved to the web, Matrimony, Vacancy/Jobs, Buy/sale cars/vehicles/houses etc. This was very natural thing and I feels now there is nothing much from classified which can be moved to web, may be very narrow niches like “services” and “Rent”, these are being done by sulekha but still there is a good scope for launching a vertical business, specially on Rent.

5. I love businesses which come in this category, the problem is, there are not too many, due to over complexity and low returns. I wanted (and still do) to solve the problem of waste in India, we all know this is Local municipality’s responsibility but they are too numb towards this, the problem is, I realized that this is a very big thing and I don’t have the resources and will/”balls” to do it. There is not much money in it either so just like every Indian, I too want to see the change but don’t want to do it myself *sigh*. Some great ideas can be giving small loans, education, hospitals, vaccination, houses etc

So I went to Titan Eye, Jayanagar, Bangalore, spent 5 mins, liked a frame and asked the price, they said 26,000! Wait what ? how much, 26,000 + for glasses, 11,000 so overall it will cost you Rs 36,000.

Now for someone whose budget was 6,000 (not that I can’t buy costlier frames/glasses, it is just that I feels like it is not worth it, 6k is also not a small amount), there is no way I am going to pay 36,000. I have no idea about the built quality of the frame nor about the company (I had never heard about that company anyway) but paying 26k for a frame is ridiculous, unless it is made of real gold and diamond, something which it wasn’t.

So I politely said, I will think about it and came back.

Now while coming back, I was just thinking of Business model of Titan Eye. I saw some reviews of it on the web which were not that good, everyone was complaining about the pricing that nothing is less than 10,000 there. I am also very sure that the manager and employees there are on payroll (unlike on earn when you sell, something which typical optician follows).

One thing is sure, Titan Eye is looking to target the upper class segment, those who won’t look at the prices and will happily pay 25k for a frame which probably costed 10k to titan eye but the question is, how many such people are there in India and are they that stupid ? well the answers is, the number is way higher then you think and yes. In metros, there are tons of people with loads of money to burn which is the target market for Titan. Though I would love to see a similar store for Indian upper middle class but then, won’t be competing with the local opticians stores, which offers personalization ?

I don’t see why this can not be done, the problem is lack of will from the big companies of India. They are like to follow rather then lead and unfortunately innovation takes the backseat when it comes to growth.

Back in 2000, when the mobile war started, all the companies focussed on mobiles as compared to broadband because it had the real money and growth potential, and they were right, but the problem now is you can’t go any cheaper then what they are offering, Mobiles have very much become a commodity now and mobile companies can’t play with the price. All the growth is now organic and the market growth saturated.

I think its a great time to start a broadband war to do something what reliance did in 2000 with their Monsoon Hungama offer, they started offering mobiles for Rs 500 which made people go crazy for it, now only if Airtel or Reliance can start offering Internet for free (BSNL is hopeless), they can offer a package like 256kbps speed + 1 GB for free per month and you have to install their software to browse the net. For bigger plans, they can also cut the prices to half and look to play the “volume” game which they know really well.

It doesn’t take a genius to figure it out, once people get used to internet like buying train tickets online and seeing online exam results, there is no way they will be going back and if the bigger plans are going to cost Rs 250 (512 kbps + 5 GB), they will happily opt for it.

But the problem is, as usual, companies don’t know the depth of water and everyone will wait for some one else to make the move and in this “you first” “you first” attitude, the train will be “gone”

It seems all these Vishal Mega Mart and Big Bazaar find the most incompetent people who have no desire to help customers/shoppers and put them to manage everything. I know they are underpaid (probably 3k to 6k per month) and that their work do not require any skill but this doesn’t mean they don’t have to do anything. Most of the time when I go to nearby vishal mega mart, I never get straight answer from anyone, most of the answers are like “mujhe nahi pata” (I don’t know) or “ask someone else”.

This is where local shop score over these big retailers, there is personalization. The local shopwala knows his customers, call them by name, doesn’t mind getting paid later and suggests you new products.

Another problem with these big retail chains is that they are looking to grow way too fast without really too much thinking about the existing customers, ideally they should be focusing 80% time/resources on what they have currently and to make it better and stronger and the rest 20% time/resources on starting new stores and doing new thing but I think it is otheway around.

Why can’t the staff of retail marts act like staff of mcdonalds, they are also not that well paid but they are told to help their customers and talk to them nicely which do it pretty well.

It is not difficult to imagine that becoming a property agent do not require much skills or educatoin in India, and anyone who can talk and has good connections can start the business and there is easy and good money in it.

I think the time has come for India to start regulating properties buying/selling in a more controlled way and starts issuing licenses for being a property agent just like in USA and other countries and of course there is loads of money on the table for the government.

So in short, India hasn’t seen any big idea taking off and I feels things won’t be changing in 2010-11 too, the most obvious business models are already been implemented in the form of transferring of print classifieds to online portals, like jobs, matrimonials, buying/selling vehicles etc and now we are seeing very vertical startups, say offering loan comparison, food ordering and even selling shoes online, I have serious doubts of any of these becoming next Naukri or shaadi or justdial (100+ crores businesses)

As the time is passing by, I am getting more and more convinced that in India, if you want to launch a successful startup, you have to merge both online and offline market as well as mobiles, you can not be successful just by offering some stand online service and hoping to make money through advertisement, which is the worst business model for a startup as you don’t want to make money from attention when the real money is in intention

This is a quick “10 Pointer list” (could had more points easily) based on what I am seeing and have seen on Indian web space and what problems online businesses faces or common mistakes they make -

1. Majority of the people who are starting the web startups in India thinks they can make money from anything building anything, this just don’t work, the advertising model also don’t work (unless you are a 2-3 member team with little expenses).  You can look at the 2007-08 posts review of startups of plugged.in,alootechie,startupdunia  and see how many are still surviving ?

2. Last time I had covered this posting too, Too Spread Too Thin is a major problem in India, about which nothing can be done unfortunately.

3. Another mistake which founders do (I myself did couple of times) is to overestimated the market heavily, means not able to to understand the volume and value of the market. Most of the figures which are projected of various Indian sectors (say media or advertising or marketing) are often fragmented and the saying the market is of 350 crore often do not mean the market has full untapped potential of 350 crore.

4. Entry level barrier is too low and IP laws are non existing which means copycats pop up in matter of weeks in India, the cost of starting a web business has come down so much that anyone can start it in matter of days without building any business plan or revenue model, once a site starts getting some traction, 20 similar sites also pops up adding no value and just crowding the market.

5. Ignoring existing players – With online businesses, many times, when you start business, you fail to see the overlap between already existing players or players which are there but you never see them and later finds them.

6. Unlike in USA, All Venture Capitalists in India like to play safe so the money is only going into big players who knows how to pitch themselves or have good connection, of course, we can not blame VC for playing safe, it is their money and India is yet to mature.

7. People in India don’t want to use credit cards which often makes cost of acquiring customer very high, this hist cost of acquisition and retention is the reason why majority of the sites in India which starts with big bang either shuts down after 2 years or goes into maintenance mode due to not turning enough profits.

8. Payment Gateways – The situation of payment gateways haven‘t improved much, last month when I was looking to make to post on them and reviewing most of them, many of them were not even working properly, most of them have ridiculous fees (I call it ridiculous business model) where they are charging heavily on per transaction.

9. Last Mile connectivity – The lesser the said about this, the better it is. India seriously needs a package  like Reliance Moonsoon Hungama which was offered by reliance in 2000 for Rs 500 which created a revolution and people went crazy for mobiles which now had resulted in 640 million mobile connections, now mobile connections being getting saturated, it is good time to get into broadband war for these operators and start offering Internet for free or for Rs 99. let people get the “taste” of internet, once they get it, they will automatically start using it.  The reason for such long Rant is, though TRAI  says India has 8 crore active users online (those who uses internet once per month), from what ever I have seen, I think India has about 3-4 crore active users, mostly in the range of 16 to 32 crowd.

10 – Short Sightedness of founders for long term – Though I really can’t blame founders for this, but many times i have seen founders looking to make huge profits or looking to exit in second or third year, this is not very unlikely scenario in India. For example, Faisal Farooqui started Mouthshut in 2000 and is still running it. he could had sold it for a decent price in 2006, may be in 2008 as well but he kept it, a good lesson for others too.

I can think of few more points but will cut down the list here only

Indian Online Space is way too Spread and is way too thin, making each startup to push extra hard to find, convince, acquire and retain customer meaning the startup to put more resources hence higher burn ratio something which I am seeing more and more often.

As a startup, you can not do anything to change the market other then evolving and remolding yourself to be what the market yourself to be and the great thing about Indian market is, the rewards are huge for the players who have followed what the market want them to be.