The rise of mobile classifieds [Guest Feature]

Guest Author: Currently serving as CEO, Olx India, Amarjit leads the category development efforts, executes marketing programs to create brand awareness and improve user engagement, build strategic partnerships and formulate strategies for driving growth. Prior to Olx, Amarjit was at eBay India where he was heading the New Business and Global Trade function and was a member of the India Management team. Amarjit has worked in various roles with eBay India and Baazee (now eBay India) during his 5 ½ years tenure.

Amarjit holds an MBA degree from University Business School (UBS), Chandigarh and graduated as an Industrial Engineer. He is also the Secretary of the Mumbai Chapter for the Executive Education Alumni Association of the ISB (Indian School of Business).

India has entered the age of consumerism.  Changes in the consumer shopping behaviour are now evident with evolving seasonal trends and higher disposable incomes. No longer would the consumer hold on to a product till it broke down or got obsolete. The smaller than ever product lifecycles with high replacement demand and availability of used products in good condition has resulted in the willingness to explore used goods among the growing middle class who have been so far constantly balancing affordability with aspirations. Thus 2^nd-hand products have become substitutes when it is considered to be impractical or unnecessary to purchase new products.Various studies peg the used goods market in India at roughly Rs. 65,000 crore, but it could be much higher than that as most of it is latent. 

Online Classifieds serve as an essential platform to buy and sell used productsin any evolved internet market. At the basic level, free online classifieds services such as OLX connect individual buyers and sellers and allow disintermediation and help individuals sell, buy, rent etc with other individuals. This transaction occur offline after the initial ‘online’ information exchange, in a manner most convenient to the individual buyer and seller. The resultant democratization of the transaction by elimination of middlemen leads to value generation for both buyer and seller.Besides used Cars and Bikes, other second hand goods in categories like mobiles, computers, electronics, furniture and different types of personal and household goods are now sold over internet by individuals to other individuals, thus making everyone a seller. These sales generally happen within the city or sometimeseven within their localities.  Through easy display of product to be sold through a classifieds ad that is rich and descriptive, buyers can contact sellers easily to facilitate the transaction.

This segment of general horizontal classifieds has grown rapidly through the year and is in top of the mind recall of consumers. 

Refer OLX growth on PC source Comscore this year: 

Having said that, India has witnessed a major change in the way internet is being accessed in the past 1 year. More than any other country, India is witnessing a huge uptake of internet services from a mobile device. There are many reasons for this trend. India is one of the cheapest mobile data markets in the world. The availability of a wide variety of smartphones and feature-phones with economical data packages from mobile operators in the last couple of years has resulted in increased internet access from handheld devices. According to Stat Counter’s Report – India is the World’s first country to see Web usage dominated by mobile devices. Mobile Web usage overtook the PC based Internet in India in May 2012. The reports for last month indicates that mobile web accounted for 51.63 percent of Web usage, with desktop devices making up the remaining 48.37 percent. That’s a first for India, and it follows a steady uptake in the share of Internet usage from mobile and tablet devices.As the price of smartphones and other Internet-ready devices lowers, mobiles will bring more opportunities for those experiencing the benefits of Internet for the first time.

According to the latest McKinsey report, India’s Internet users will increase fivefold by 2015 and more than 3 quarters of them will choose mobile access. It is expected that Internet in India will touch 300 Mn in the next 3 years, with roughly half of the new additions being mobile only users. With the emergence of this trend, it becomes even easier to use classifieds service from a mobile than a desktop PC. No longer would any individual have to use multiple devices to post any ad or access these sites through a fixed PC. If you are a consumer wishing to sell, you just click a picture of the product you wish to sell from your mobile through the OLX app, add a brief description and expected price, share your preferred contact information and you are ready with your listing. You can even share your listing with your Facebook friends at the click of a button. No need to transfer images from your camera or mobile to your PC or enter your location coordinates.

The OLX app also utilizes location coordinates to assist a buyer, who can figure out the items available for sale nearby through the maps integration within the OLX app. He can search products he wishes to buy in his locality, and simply click-call the person who has posted an item of interest,all through the mobile. The ease of using the service from mobile makes mobile classifieds apps an essential tool for individuals who are always mobile ready, have shortage of time and need to take action immediately.

With most new to the net citizens of India coming online through the mobile and tablet screen, mobile first orientation is essential for any service that aims big in India. OLX has been the pioneer in introducing the Mobile apps in this segment. We are already there in the mobile space since last 3 years via a wide array of Apps for all smartphones and tablets – iPhone, iPad, Android, Blackberry, Windows Phone, Blackberry and Symbian. Infact, we have been currently investing in mobile product experiences with a mobile first orientation to developing online classifieds. We also have our mobile site which is optimized for feature phones, and this week OLX also launched the html5 version of the mobile site offering extended functionality on smartphones. For OLX, mobile traffic has grown exponentially through this year (15 times over the last year) and now roughly 30% of the total traffic is coming through mobile and tablet devices. OLX has shifted the power to the individuals where they can buy and sell anytime, anywhere and with no help and it’s so simple that even a novice internet user can learn to use the apps quickly.

A key point to note is that Mobile Classifieds is not only a technical solution, as having a user friendly and effective mobile apps or mobile site is not going to guarantee success. Mobile is just a means of access. The reason why a mobile site or app would get popular and gain traction would be determinant on the liquidity of the site as to how many buyers and sellers use their site already. Here, OLX.in has an advantage as it is already the Biggest and most popular classifieds site where millions of Indians are buying and selling everyday.

The market is gearing up and companies which are most competitive in the mobile screen will potentially outshine others. According to IAMAI report on Internet Usage in India, the Mobile has been consistently raising growth of Internet usage in Rural India by 7.2 times since 2010. Despite a population in excess of 1.2 billion, India’s Internet penetration rate remains below 10 percent. That makes mobile — both smartphones and feature phones — the most accessible Internet platform for hundreds of millions in the country, and the growth suggests that more Indians are getting online thanks to increased ownership of Web-enabled devices.The online classifieds is all set to grow at a rapid pace in 2013 and a large contribution is from mobile traffic and internet access in both Rural and Urban areas.

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Amarjit Batra