By Arush Sogani, Founder, MyITY
Headquartered in New Delhi, MyITY is an on-demand hyper-local platform providing service in a wide variety of households & holdings along with tech support & consulting services for small businesses across sectors like manufacturing, real estate, law firms and schools.
Business in the past few years has undergone a radical shift. Traditional methods of conducting business have seen a paradigm shift. Certain business models have in fact become obsolete themselves. Technology has helped bridge that gap, today the hyper-local service market helps solve multiple requirements for homes and offices from just an app. The latest shift has been the emergence of hyper-local startups. The surge in Internet users, increase in payment options, increased presence of geo-tagging and GPS aware devices and suitable demographics have paved the way for hyper-local businesses.
With both, investors as well consumers sitting up and taking notice, on-demand hyper-local services are currently everyone’s favorite. There is a dynamic range of services already on offer - your transportation, your grocery, personal-care services or IT solutions - hyper-local startups are taking care of everything. No wonder the hyper-local market in India is slated to exceed Rs. 2,306 crore by 2020. Hyper-local startups, in terms of their business model as well as operational frame-work, are the last point of customer engagement. This, in turn establishes brand recall, a goodwill that startups can never get less of. E-Commerce giants who have already spent millions on customer acquisition are also acknowledging the hyper-local opportunity and preparing to partake in the gold rush.
But what is Hyper-Local? It’s a business model that thrives on providing localized services basis geography. Hyper-locals, services-based or inventory-based, are largely an urban India phenomenon. When moving into a new city, for example, people would like to stabilize as quickly as possible and here, such services step in. Hyper-local business models focus on instant delivery as they cater to needs of a more immediate nature with entire transactions being completed in an hour sometimes. Customers also tend to trust hyper-locals more as the stores they buy from through online platforms have a physical presence thus enabling quick grievance addressal. Bringing in the existing infrastructure and connecting existing merchandisers with the customers is also a route start-ups can take.
It sounds a linear model but establishing it can be quite Herculean. One of the biggest challenges that plague the industry is stability. Often start-ups fall into the trap of expanding too much too soon. Instead of pin-pointing one specific vertical they want to cater and excel in, they quickly begin taking on various roles. A hyper-local model by definition is not in complete control of the entrepreneurs, that’s why establishing a secure supply chain command is essential. It operates on aggregation, whether of retailers or consumers. Any aggregation model is light on asset and inventory and heavy on scalability. Often while servicing a particular area an important factor that can put a dampener on business expansion is whether the business model is adaptable to any area. It does not do well if the brand is built keeping a specific topography in mind and then faces a dead-end when tested in another city/country.
Customers today are well informed and connected. A bad experience can result on instant venting on social media and the internet. That in turn could lead to terrible bad publicity for the brand. Customer Relationship Management (CRM) is a key success factor. It is essential to keep checking in with customers for their experience, feedback and to retain customers. It’s the oldest adage in business management that it’s cheaper to retain a customer than to find a new one.