The ticketing arm of Indian railways, IRCTC recently partnered with online retailer Yebhi, to diversify its revenue sources. Yebhi’s white labeled solution now runs a shopping portal for the railway ticketing site which clocks the highest number of online transactions in India. This partnership will reap benefits for Yebhi. As the online retailer’s CEO Manmohan Agarwal points out in this interview, 25% of the traffic from IRCTC is already going to the shopping site. Also Yebhi has access to the details of the users who transact once on the online retail portal. That’s a fairly large user base. Associating with a trusted government subsidiary, will further enhance trust factor in the mind of users which may remain even when the contract between the two ends. Clever play that one!
In this interview, Manmohan Agarwal, Co-Founder & CEO,Yebhi to goes into the details of the deal. Edited Excerpts.
Has Yebhi done any white label solutions before?
Yes, we have partnered with Citibank and Axis bank for over a year now. Cash backs, coupons, reward points, EMI options etc features can be availed on Yebhi.com as part of the partnership.
What was the thought behind collaborating with IRCTC?
Undoubtedly, IRCTC is one of the largest e commerce players with over 2 crore registered users and approx. 4 lakh transactions daily. These users transact using debit and credit cards (No COD) and hence are accustomed to online buying. With such a niche set of users it makes all the sense to do online retailing and so the partnership.
But, will it conflict with Yebhi’s interests from a brand perspective?
I don’t think so. For any industry to survive it is very important that there is competition. Also the large market size means more players can have their share with no one coming in the way of others. I am very optimistic and always think constructively when it comes to growing the market.
As a white labeled solutions provider, what aspects do you manage?
We take care of the process end to end. Product sourcing, logistics, technology, inventory, marketing and other tasks of the venture are managed by us. IRCTC is helping in the promotion of their shopping portal at their end.
How you plan to promote the new online shopping destination to users?
That’s the best part. We do not have to do much to acquire customers. We are promoting it through online ads, social media and general marketing techniques. But the differentiation is these users, as I mentioned earlier, are already comfortable in transacting online and already trust IRCTC brand. IRCTC is already promoting at their ticketing portal, and once they start sending mailers and targeted advertising to their database it will be an easy job to pull these users and hence the customer acquisition cost will be very low as compared to other portals.
What has been the traction so far since the launch?
It has been a very less time since we went live, I cannot share the actual numbers as its too early to speculate anything. But almost 25% of the IRCTC traffic (irctc.co.in) is coming to the IRCTC’s shopping website, which is pretty good. We are happy so far with the progress.
How many brands and products does IRCTC’s E-commerce portal feature?
Currently, it has over 60,000 products and more than 600 brands. Also we plan to launch more categories which we may not do on Yebhi.
How does the revenue share model work?
It completely varies from category to category. It ranges from 1% at the minimum and goes up to 10%.
Do you have access to irctc.co.in, database, the 2 crore registered users?
No we do not have access to the main database. But once a customer transacts on the shopping portal his details are shared with us.
There is a separate login for the ecommerce portal even for the users who are members of Yebhi or IRCTC or both, why?
There were lot of complications at the back end, so we decided to keep it separate. If we had waited to resolve, it would have taken months to launch it. Though we are working on it and in future we may integrate it.
How you see this ecommerce venture shaping up in future?
As per my speculations in coming 1-2 years it will be one of the largest online shopping properties in India. We do not have to go here and there, if we just focus on the current registered user base of the online ticketing portal, the job will be much easier.
How is Yebhi.com doing? How many transactions are you clocking on a daily basis?
We are doing approx 7,000 transactions a day with an average ticket size of 1,600-1,800. We hope to be profitable in coming 1-2 years and are happy with our current speed.