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The Good and Bad Advice for Bootstrapped Startups

[Editorial Notes : Every founder receives a few good advice and well, a lot of bad recommendations. Anshuman Sharma, founder of Chulbul Store shares some of the advice / gyaan received while building the startup.]
When you start an e-commerce business, you get a lot of “gyan” from people and it translates into thousands of ideas that can work for your business. It’s called hard work when you work 20 hours a day to implement all these ideas but it’s called smart work when you spend a week to jot down all the ideas, filter them as good or bad and then prioritize them for implementation.chulbulstore
The latter way has a much better pay back. Here are a few things that we learnt during our first year and we feel that these things should be on the top of list of any aspiring ecom-startup.
1. COD
Bad advice: Don’t start COD too early. It is very risky.
Good advice: Start COD as soon as possible.
We charge Rs 50 extra for COD orders but that does not seem to deter customers from making a purchase. It has in fact doubled our sales. Remember that not all of your target audience has debit/credit cards or access to internet banking. Also, Indian consumers believe in cash transactions even if it means paying a little bit extra, especially when purchasing from a new website. If we have a doubt on a COD order, we check email validity or call the customer before processing the order.
2. Selling through online marketplaces
Bad advice 1: Sell through all marketplaces. It will increase your reach and orders.
Bad advice 2: Don’t sell though any other website. They charge too much commission and you will not make any profit.
Good advice: Figure out which marketplace suits your product best and start selling on them ASAP.
We started selling on Snapdeal very early in our business. Gradually, we started selling through Flipkart, Amazon, Fashionara and Paytm. We’ve made sure through our pricing that we don’t make loss by selling on these websites.
Flipkart not only gets us a good percentage of orders but has also helped us gain trust of our customers. Several of our customers bought our product from Flipkart first before starting to buy directly from us.
Snapdeal has not been very good for us. The customers there are those who are more interested in discounts and offers rather than product quality. We get very less orders and a higher return rate from Snapdeal. Our product and pricing is not suited for Snapdeal. So it’s important to figure out where you will find your target audience and then spend energy and effort to get your products online there.

Babas to Founders : You Know Nothing!
Babas to Founders : You Know Nothing! [Courtesy:Chulbul Store]
3. Social Media Marketing
Bad advice: Facebook is the boss of social media marketing. Put most of your efforts there.
Good advice: Pay equal attention to Facebook, Twitter, Instagram and Youtube and see which works out better for you.
Facebook is not as good as it was before. The organic reach has gone down considerably. Unless you spend money, there is hardly any good response. Then, there is the controversy of fake “likes” that can be bought on facebook.
Twitter is better as you directly talk to real people.
Instagram is cool as people like to watch good images.
Youtube is rising steadily. Marketing through videos looks like the new “in-thing” although making cool videos is neither easy nor cheap. If you can crack this, your reach can improve considerably.
4. Spending on Marketing v/s Branding
Bad advice: Don’t spend on branding. Spend on marketing to reach more people.
Good advice: Allocate funds for branding. Spend it wisely to show the world that a big brand is coming up.
We spent money on marketing with the aim of reaching more people. We did marketing with freecharge by giving discount coupons. Freecharge has a million visitors daily and it looked like a promising marketing idea. It did not work. The probability of someone ignoring discount coupons of McDonalds, CCDs, PVRs and 100 others and picking up Chulbul’s coupon was extremely less. The probability of conversion was still lesser. We were just not in the right stage to do that kind of marketing.
We stopped spending money like that and started spending it on brand building. We have our own packaging bags now. We have an awesome logo. We have a colour theme that shows on our website, bags, visiting cards and just about everything that can be coloured.
We even make our stalls in Comic Con match our colour theme. The idea is not to go to a lot of people and not be remembered but to reach a few people but leave an impression. People have started recognizing us as a brand now.
5. Customer service
Bad advice: Set up a toll free number to give impression of a big company.
Good advice: Let people know that you are a startup and you provide good customer service.
Setting up a toll free number makes it mandatory to have a customer care representative otherwise the number is of no use. A bootstrapped startup cannot afford this. So it’s better not to have a toll free number in the beginning.
We give our mobile numbers on the website for customer care. Since we are unable to take all calls all the time, we specifically mention that we can be contacted through whatsapp.
People love it. No one complains that we sometimes miss calls since we reply on whatsapp whenever we get time. We let people know that we run this company and we’ll do our best possible to keep them happy. We give free stickers and posters to unsatisfied customers.
We make the customers feel good and cared for. This is much better than dialing a toll free number to a big company and waiting for 15 minutes to talk to a real human being.
All of this tells one more thing: It’s important to have a good mentor who has the experience and knowledge to help you with critical decisions. We were fortunate enough to meet Lalit Mangal (co founder at Commonfloor) halfway through our first year’s journey who agreed to mentor us. Having a good mentor is the biggest blessing a startup can have.
Don’t shy away from spending time and effort to find a good mentor. It can be the turning point for your startup.

3 comments

  • Thats a bang on article about how folks start up and the dilemma faced in choosing between two right things and touching all important aspects of business. I guess you defied the stereotypes and stuck to the core of pick what suits you.
    You have a nice website must-say. Just wondering, how does a catalog size of less than 50 designs on Flipkart attract decent sales when there are thousands of designs by other companies? Just wondering.