Exclusive | India is an significant market: Groupon's Ankur Warikoo

Global online deals major Groupon with a presence in 48 countries has rebranded its Indian arm Crazeal.com as Groupon India. Groupon is a leader in the online deals segment in the USA and Europe already and sees India as a significant market for itself. It is very bullish on growth in India, where it sees immense potential across its three business verticals – local service deals, business travel deals and products. The website features deals from about 400-500 merchants every month and Groupon claims it sells a voucher every 33 seconds.

It targets working professionals in the age group of 24 to 35 years. To communicate the rebranding exercise, Groupon has launched a TV commercial reinforcing the message that Crazeal is now Groupon. As per ComScore data, Groupon is already number one globally and also in India on the basis of deals size.

Adgully spoke to Ankur Warikoo, CEO, Groupon India and Sachin Kapur, Chief Marketing Office, Groupon on various aspects of the company’s growth plans in India. Replying to a question on how Groupon looks at India, Warikoo said, “India is being looked at from two perspectives. The sheer size of India from a deal perspective is huge and we have not even scratched the surface. The entire potential is $ 2-3 billion. A lot of our investments in India are being made in technology to support merchants in what they do as a business. That is the business side.” From a talent perspective, he said, Groupon needs engineering talent as the company is graduating to a technology company. India has the potential and talent to support our growth. Groupon has just opened an R & D support centre at Chennai which will support Groupon globally.

Whether 2012 was a tough year from a macro perspective, Warikoo said, ‘ we are too young in the system, just a year old to feel that the year was tough. Though we saw the entire industry going through a slump, our entire focus has been to strengthen our presence amongst merchants and consumers.” Adds  Kapur, “ we did not feel it as we are growing at a fairly fast pace.”

Talking about the year 2013, Warikoo said, “  we are looking at sustainable growth and at a rate that is higher than what has been achieved so far. We want to grow incredibly fast.” The coming year is going to be very interesting for Groupon in that sense as it aims to reach out to larger strata of the population and more merchants than in 2012.

Groupon has a very niche and young team from various backgrounds, all driven by the same world view – in fact a small team  driven by common goals.  Says Warikoo, “we follow what is called 10 commandments for business, the two important ones are – We only feature deals that we ourselves will buy. That ensures quality. The other important commandment is – everyone has to have a hero in the organization. In other words an employee has to become a hero for someone else in the company. In that sense everyone has to accomplish something and when this happens across the board, the company will become the best.”

To reach out, Groupon is doing a lot of digital marketing as well as offline marketing. Being a late entrant in India it does not  make sense to go ballistic as a lot of money will be spent in the process. Says Kapur, “we are doing a lot of experiential marketing in unique ways, an example was a giving a helicopter ride during the Ganpati festival. We think continuously what would be the next unique experience, our idea is to build through experiential marketing, so we started with a lot of merchants, once we have the numbers we want to reach out to the top strata.”

The company is looking at the population that is inspirational and wants to experience premium lifestyle, as Kapur calls themselves a “lifestyle discovery engine.” Currently Groupon has presence in nine cities – the four metros besides Ahmedabad, Bangalore, Jaipur, Chandigarh and Hyderabad. It is focusing on new markets from a products perspective another 50-60 centres where there is lot of infrastructure, “local merchants, premium brand outlets, good hotels etc” adds Kapur. Groupon want to give unique experience to first time visitors, say for example an evening of fun. “Once they have experienced it for the first time and are satisfied, we feel they will keep coming back. The potential thus is huge,” adds Kapur. Groupon is also introducing a lot of deals at the mid & lower end of the price band. In that sense 2013 is very important for Groupon as it plans to reach out to large population.

Towards this end it is also planning a couple of mass media campaigns. “Primarily we are focused on genres like English entertainment channels/ news and lifestyle channels. It has just launched a TV commercial and wants more and more people to understand what it does. The company also has a social media presence to make people familiar.

As for communications strategy, Kapur says, “ we want to keep things simple and very focussed. The creative  brief was ‘Indian customers like ABCD – Astrology, Bollywood, Cricket and Deals.’ We wanted to create a disruption in the market, create clutter breaking advertisement by using humour at the base level.”

Although its entry in India is late, Groupon is fast consolidating its position in the country.  Says Kapur, “it is true that we are late but the Indian customer was not in a position to benchmark deals earlier. Now with our entry, he knows what a great deal would be. People have taken this up and they are coming back.”

However despite growth prospects being bright there are challenges like infrastructure challenges,  logistics, payment options, talent availability etc. One of the biggest challenges the deals segment of the e-commerce industry faces is getting consumers to adopt online shopping. People have been habituated to buying things from retail storefront. While it is a challenge, it is an opportunity also. Says Warikoo, “We solve this by working with the best brands in the country – so customers come in with a lot of trust already established. Further as a global leader in this space, we take it upon ourselves to be absolutely transparent in our conduct and at the same time build the market in a manner.”