Marketing expenses, a major head, have been cut to zero by the online ticketing platform. Top executives will immediately take a 30 per cent+ cut, others will follow from May.
One e-commerce company may seem a lot like another e-commerce company until COVID-19 comes along. Then it becomes evident that each has problems that are peculiar to itself.
BookMyShow, whose name has been synonymous with booking tickets to movies and events for 20 years, has been hit hard by the closure of movie halls, its bread and butter business. It has expanded successfully into booking for sports and cultural events but those have disappeared as well, for now.
This has compelled it to cut back on costs in a big way. BookMyShow will no longer spend money on marketing, a major expense. Administrative expenses too will be cut by half, according to an internal mail from Ashish Hemrajani, co-founder and CEO.
On the employee front, executive salaries (including variables) will be unaffected for March. To ensure that employees have money in their pocket at the end of April, the company is adjusting it against a month’s annual leave that employees are entitled to. (Any leave taken later in the year will be without pay.) Senior executives will, however, take a pay cut of 30 per cent and more from April.
If the impact of the pandemic continues, thus affecting BookMyShow from operating normally, staff salaries will be cut in the range of 0-35 per cent for May and June. These cuts may be extended in subsequent months but these have not been specified.
BookMyShow’s holding company, Big Tree Entertainment, was founded in 1999 and, according to ET, its revenue surged by 52 per cent in 2019 to Rs 619 crore while its net loss declined by 30 per cent to Rs 115 crore.