Chinese e-commerce firm, Club Factory has surpassed Snapdeal to become the third largest shopping app (in terms of MAUs) in India (according to data analytics platform App Annie).
The brand has shifted its business dynamics, and is now focussing on engaging local sellers to resonate with customers on the basis of products locally made in India. This year, it has brought 5000 local sellers on-board.
The e-commerce firm is expanding its business horizon in India, despite the rising concerns of government authorities and Indian customs authorities about Chinese e-tailers operating in India. The brand will soon add new categories in its product line-up such as kids, sports and fitness-related products.
According to Vincent Lou, founder and chief executive officer, Club Factory, “India is a vast and diverse market with a huge population waiting to get online. There is room for every player that is willing to invest its resources in meeting consumer demands. The pioneers of the industry have already invested in the e-commerce market to make it operationally ready and made it easier for the other players.”
“Our core strategy is to empower local sellers to help us in meeting with the increased user demands,” he shared.
When asked, about the growth plans for the Indian market and what kind of opportunities the brand is looking to tap into, he said, “We are the only e-commerce player in India that is not charging any commission fees from the sellers, which essentially means that the sellers can achieve 20-30 per cent cost saving when selling on our platform.”
“We are making significant investments in infrastructure and technology to create a thriving ecosystem for sellers and Indian SMEs (Small and Medium Enterprises). We have three warehouses to meet the demand for quick product delivery and have just opened a new warehouse in Mumbai. We recently partnered with some local, top-tier logistics players for fulfilment and last-mile logistics space to provide a faster delivery in India,” he explained.
“We have witnessed a healthy growth of 300 per cent YoY on order volume since the local SME strategy was implemented and it has become the key driver for our growth,” he divulged.
On the competition posed by two big players — Amazon and Flipkart, Lou said, “Players such as Amazon and Flipkart have laid the foundation for a robust e-commerce ecosystem in India. Our goal is to provide a fair marketplace where both the sellers and buyers are benefitted. Our current monthly active user number stands at 50 million and we have over 30 million stock keeping units (SKUs).”
SKU is a number assigned to a product by a retail store to identify the price, product options and manufacturer of the merchandise. It is used to track inventory of the retail store.
Last year, the brand roped in Indian brand ambassadors to boost regional presence and is now planning to come up with a new campaign theme to promote the zero commission fees offering for local sellers in India.
On being quizzed, whether the brand has an advertising agency on board he said, “We don’t have any agency-on-record for a retainer. However, we have worked with some of the leading creative agencies in past such as Publicis and Group M. As of now, we’ve not officially decided to onboard an advertising agency. But chances are that we might in the future.”
He further added, “We use an integrated marketing strategy, including digital, OTT and offline media to reach the maximum target audience in the future.”