Archiesonline to break even soon

Archiesonline, the e-venture arm of Archies Greetings, is looking to break even in one-and-a-half years, even as Archies plans a three-pronged strategy to leverage the Net.

Ritujoy Chakraborty

Archiesonline, the e-venture arm of Archies Greetings and Gifts Ltd (AG&G), has set an optimistic target of breaking even in one-and-a-half years' time. Towards this end, the company plans to focus on a three-point programme that encompasses retail-level monitoring of sales, apart from B2B and B2C initiatives. Profits are expected to start flowing in within three to four years.
The Rs 70-crore AG&G has already invested Rs 50 lakh in Archiesonline, and plans to pump in a like amount by end-August. The web site, which is to be formally launched on August 15 (to coincide with Rakhi and Independence Day), had earlier tied up with Yahoo! India for e-tailing cards.
For AG&G, which is gunning for a 20-per cent growth this fiscal, Archiesonline is a potential money-spinner. Spelling out the e-objectives of the company, Vijayant Chhabra, executive director, AG&G says, "We have over 450 franchised outlets and 15,000 retailers selling our products across 120 cities and six countries. Considering that we produce around 8,000 new designs of cards and gifts every year, we need to keep a tab on which product sells well and which doesn't and in which region. For this, Net connectivity becomes essential."
Chhabra further elaborates on the B2B and B2C plans. "Any horizontal portal today wants to offer two products - greeting cards and gifts. It takes a lot of money to develop this content. Since we have this expertise that portals can avail off-the-shelf, we see a huge business opportunity in providing e-cards. We are already doing so for Yahoo! India. This apart, we are looking at providing a B2C platform for our customers to log on and exchange Archies cards."
Quite naturally, Archiesonline will be treading the cautious path and not charging consumers for its e-cards. However, its eventual revenue model will involve space-selling and paid-up membership. This will be in addition to the revenue generated by providing e-cards and related content to hortals.
The million-dollar question is whether free e-cards will cannibalize the sales of paper cards. Vineet Kumar Kapila, chief officer, marketing & alliances, Archiesonline, discounts the fear. "Unlike an e-card, a paper card can be held, preserved and cherished. Its possession value far exceeds that of any e-card possible. Further, the US market has shown that despite a flood of e-cards, the market for paper cards has grown steadily."

© 2000 agencyfaqs!

First Published : August 13, 2000

© 2000 agencyfaqs!