‘We will show how it’s done’ – Paytm Mall heads to the Middle East, with a push from eBay
- In an interview with Business Insider,
Rudra Dalmia, Executive Director, Paytm Mallshares the aggressive growth plans PaytmMall has.
- In July, American e-commerce giant eBay had bought a 5.5% stake in Paytm Mall.
- The company is already contribution margin positive and is aiming for net profitability.
American e-commerce giant eBay had bought a 5.5% stake in Paytm Mall,
“We are going to build a very large Gulf business and export is going to be a big thing for us. Currently, we are testing the partnership with Ebay, who will expose our Indian catalogue there,” said Rudra Dalmia, Executive Director, Paytm Mall in an interview with Business Insider.
Through eBay’s investment, Paytm Mall will also make eBay’s entire catalogue available to Indian users.
The company ended the last financial year with a Gross Merchandising Value (GMV) of ₹130 billion and is now aiming for ₹170 billion GMV by 2022. It also cut it costs by 85-90% every month.
“We are already make a margin positive contribution. Now we don’t sell anything, where we lose money. The aim is to now achieve net profit which will take a few years,” said Dalmia.
It was a cold December morning, when the newly joined Dalmia had a meeting with Vijay Shekhar Sharma, who said “this is not working”.
That’s when Paytm Mall changed the way it worked to become an O2O model led business. With this, Paytm Mall now drives its online traffic to offline stores through gift vouchers, offers and uses offline strength to push online traffic through digital payments only.
“We took some hard decisions and decided to focus on the bottom line. We cut all unnecessary costs with an aim to be contribution/revenue positive. So, we turned the focus on paytm’s strengths – merchants and huge user base,” said Dalmia.
It plans to piggyback on the success of Paytm, whose monthly transactions are as much as 400 million transactions, to drive demand.
Better business, not a bigger business
Today, Paytm Mall is a ‘for, by and of the merchants’ platform. While e-commerce still has a 40% role, O2O now takes up the 60% chunk of its business.
“We want to be a better business, not a bigger business. Paytm already has over 13 million merchants onboarded. And there’s a lot of trust. One of the biggest achievements of Vijay has been to convince people that Paytm money is real money,” said Dalmia.
This is good news for the company, as its prospects did not look very good a while back and reports said that it might close down. Yet its fortunes changed by May 2019 as the company said that it grew by 200% in six months, and hired 200 people. And they are still hiring aggressively across roles, informs Dalmia.
“In hyper growth companies, you grow, you consolidate and then you turn profitable. We are currently consolidating and we will show how it is done,” said Dalmia.