About a month back, we started with a new startup, ParallelWay. The purpose of ParallelWay is to solve the pain of ecomm companies, when it comes to shipping and delivery. However, we screwed up.
When, we started with a model, we were not too sure if the solution we are proposing is right, and more importantly, is it doable. As, you can check in the website, we essentially provide three main features, Flat Fee COD, White Label Solution and Marketing. So, we approached various different e-comm companies, with the pitch and started talking to them on how they can save up to 40% of their logistics cost.
There were 3 main hypothesis that we were testing.
- Is Flat Fee COD model going to save up to 40% of their existing costs?
- Will the ecomm companies want a white label solution and offline marketing? Can we earn enough revenue from it?
- Can we deliver a flat fee COD model? Is it doable? Is it profitable?
Hypothesis 1: It gave a very positive result. Over the past 1 month, we have been working with about 10 companies, and we have seen great savings in their cost. Many a places, the savings percentage has been up to 60%. I will explain this with an example.
Let assume an ecomm merchant from Bangalore sells a product worth Rs.2000/- in Bangalore.
Product Cost: Rs. 2000.00
Shipping Charges: Rs. 25.00
Current COD Charges: Rs. 40.00
(Higher of Rs.30 or 2%)
Total Cost: Rs. 65.00
Total Cost with us: Rs. 30.00
Thus, you can see the amount saved. As the amount of the product increases, the savings also increases. We found for amounts higher than Rs.500/-, we are better than online payment as well.
Hypothesis 2: Out of 20 odd companies that we spoke to, 15 of them were not too interested in the white label or marketing aspect of the business. They liked the feature, but it was not a top seller for them. So, it is good to have, but not something they can not live without.
Hypothesis 3: Is flat fee COD possible? Yes. We found it doable. Is it profitable? Not at the scale we were operating. But it will be profitable at a higher scale. With our calculations, we would need to be doing 500 packages a day, to be profitable.
There were many other learning, we got from the 1-month experiment. The biggest problem is the customers. In more than 70% of the packages, we had to do a follow-up attempt to deliver the package. At times, the number of follow-up were 5-6. This is the single largest contributor to higher delivery cost. However, we did find a solution in 7 days. There were other learning too.
So, where exactly did we screw up? We screwed up in scaling up. Like mentioned earlier, we have about 10 ecomm companies, both small and big. As we were solving a good pain point, sales was not that difficult. Companies were happy to give us a try. After the first week of trying, they did see benefit and scaled up operations immediately. That is what we were not ready. We were not ready to scale operations fast. We found out, Scaling up this model is very difficult.
We tried to cope with the increasing demand for 2 weeks, but then things fell apart. Anything and everything that could go wrong, went wrong.
So, with the above learning, and the screw-up, we are now pivoting. Although the model is still going to be similar, we are changing a few finer execution details. We have already started working on the pivot, and we should be out testing it sooner than later.
Wish us luck!
In my last post, I said how being a courier delivery guy is helping me understand customers better.
Another quick point I wanted to make is, Customers are ultra connected. Many customers staying in a community, know each other. Here is an instance.
I had gone to deliver a package to a community. There were two packages to be delivered in that community. At the security gate, we gave the house numbers and they called up the respective houses.
When we reached the second house, the lady comes out and asks us, if we delivered the package to the xyz(she mentioned her name and house number). They were actually staying in two different corners in a big community and yet they knew each other.
It dawned on me then, that these community ladies are very well connected. Especially if they own the villas.
Coming back to the previous post, this is a great opportunity to get a good word-of-mouth started. It has to start with delivering great experience every time you meet a customer.
There are 4 different type of customers.
- Positive engaged: Happy and refer your product / service to others
- Positive disengaged: Happy but do not refer your product/service to others
- Negative disengaged: Unhappy and do not complain about it to others
- Negative disengaged: Unhappy and complain to others
I do not think I need to say what are the type of customers, we would like to have.
Another interesting fact, a happy customer on an average tells about it to 3 other people. However, an unhappy customer complains about it to 20 other people.
The first goal of every product/service is to try and get as few “Actively Disengaged” customers are possible. One of the ways to get this done is by listening to the customers, and understanding them. It makes a lot of difference. I know a great startup, whose focus is in this space.
The next step is to move the maximum number of “Passively Engaged” customers to “Actively Engaged” space. This will help you get more customers. This can be done by providing gratification. My sole focus is in this space, which my startup “ShoppersOn”.
I go to deliver packages like a courier delivery guy. Today, I saw a very good opportunity lost.
We have started a new service in the logistics sector, Parallelway. We intend to change a few things in the logistics industry, and taking tiny steps ahead. So, to get a deeper operational insights, and understand the market, I go and personally deliver a few packages every day.
We primarily deal with e-commerce websites. Being a delivery guy for e-commerce players, it has given me an opportunity to talk to the end consumers..
One trend which seems to be interesting is, many COD orders are made not because they do not have credit card, or online banking, but because they are not sure of the product or of the website. There is a trust gap.
Moving from an in-store shopping experience to online is a big step. So, COD helps most customers to bridge the gap and take that first step, to establish a relationship with the customer. Hence, COD should not be given a step-motherly treatment. But that is a story for another day.
So, most of the times, the moment we give the package to customers, the first thing they want to do is, open the pack and see if everything is fine. They want to try it on, and see if they really want the product. However, most companies have a policy in place. Do not let the customers open the packing, before collecting the payment.
Now, although this makes sense in terms of processes and scalability, however, it does leave a sour taste when it comes to UX. Having a 30-day return guarantee is good. But, if companies can take that assurance and trust, to the first interaction, it is going to great.
IMO, “check and pay” service will expedite the on-boarding time for new users, and they will be more happy to try the service.
After running a Startup full time for about an year, and talking to numerous other startups in Bangalore, I have come to the conclusion that the most important part (often missing) from a startup team is Sales and Marketing.
We had none given a lot of thought to this aspect of the business and were quite focused on building a good product. We did follow a lean startup methodology and came with versions of product which the customers/users wanted. However, we later realized that although the product was developed, the sales cycle can still be a pain. Whether you are selling to businesses or users. Sales is the most critical part of your startup. It is sales which generates revenue for your startup. If you do not know sales, or think sales will take of itself, you can not be further away from the reality.
And it is not just me. I am a part of SLP Bangalore this year, and almost all the 25 startups in the batch have got a lot of issues when it comes to sales. I am also a part of Bangalore Startups, and it is the same case with many. Things like how to close a sale, negotiate, find channel partners, form alliances, etc are quite a problem for most startups.
Hence, we decided to form a focused group of entrepreneurs to discuss, brainstorm, ideate and help each other on Sales, Sales for Startups – Bangalore
And when we discussed this with Mukund sir, he was more than supporting to us. He helped us with the venue (Microsoft Accelerator). It is an amazing place for entrepreneurs to get together and discuss. Madhu and Aditya from GoSonix were very generous to come and guide us in our first session.
This is a start of a long journey. The goal of the group is to help startups get better in sales and marketing.
On 8th of September, 2012 I sold a BlackBerry Playbook on ebay. I had got this as a gift and was not going to use it.
I shipped the product to the buyer and the buyer them confirmed he has received the product. Picture attached.
However, soon after the buyer confirmed, my paisapay account was put on hold.
I got an email saying, this was a standard procedure and to contact customer support. I spoke to them, and they said they wanted a Proof Of Delivery or an email from the buyer.
This all was asked, after the buyer agreed that he has received the item.
The first thing I tried was, asked the courier company to give me a Proof of Delivery. They simply said, you give the tracking number and ask them to see the delivery information on the web. So I sent them the receipt which I had got from the FirstFlight guys and asked them to check and confirm. Proof Attached.
Initially, I had updated a wrong receipt number, and that seems to be a problem. I tried to update the number, before delivery, but ebay system would not allow me update the number. After the buyer accepted the order, I thought it was not required. But was I wrong?
I tried calling the seller and sending him email as well. He said, “ebay had asked him to confirm the item received and he has done that. Why does he have to sent any email? Ebay has not asked anything of that sort to him. “
It has been 1 month now, and I am in between this rock and wall. Courier company and ebay.
I spoke to a lady named “Sonia” in ebay and tried in vain to explain my condition. Now she says, the amount will be refunded to the buyer.
I am out of options, and do not know what to do.
Can anyone please help bringing this in view of the right person in ebay? I swear, I will not use ebay again, neither to buy and certainly not to sell. I also request all others who read this post, to avoid ebay as much as possible. There are more issues than I just mentioned. All other issues for some other day.
This is problem statement, which I would be glad if anyone would be able to solve.
Every Indian city is facing a big problem of traffic and infrastructure. Long traffic jams, rush at signals, and a lot of traffic. In Bangalore, it is nothing different. Getting caught up in a traffic jam and reaching late for a meeting is a common scene. As much as I hate reaching late, I am unable to plan better and reach on time.
So almost every day, I come face to face with this problem. The government is trying to do its due by constructing Fly Overs, and laying Metro rails. However, these solutions are something which takes years to get build. So that brings me to a question. Is there no other means of transportation which can be build quicker, faster and can solve the immediate issue? Can we start thinking outside the box and find if there are solutions available?
One such solution which comes to my mind is cable cars. I believe, a cable car system can be setup faster, may be in 3-6 months. The majority of the traffic jam is caused by public transport like bus and auto. Cable cars should be able to take the load away from the road to up on the cables. Is this a viable solution? May be, may be not.
I believe this is what is required. A mass transport system which can serve the same purpose as the city buses. That is take people from one major point to another major point. From those point onwards, it would be the smaller transport like Autos or buses which can serve as the feeder system. This mass transport system should also be able to carry bicycles and if possible motorbikes, as well. Lets assume this runs parallel to the main roads in the city, with stops at major cross sections and junctions. Something similar to the metros, but a system which can be implemented faster.
Would someone be able to innovate a mass transportation system? And more importantly, if such a system is innovated, will the government take an initiative to implement the pilot run in a city? Or will we just depend on the other countries to innovate and just implement what has been implemented in other countries?
If you have any crazy idea to solve this problem, please comment. At the very least, we can have a good discussion in this topic.
A couple of days back, I returned from a trip to Amritsar, Delhi and Agra. And I had very different experience in all the 3 cities.
I would just talk about the traffic experience here. We reached New Delhi on 18th evening, and I had a presentation of ShoppersOn on 19th, at Conquest 2012. 20th was free, so we decided to go and visit Taj Mahal. We had not visited Taj Mahal earlier. So we started looking at various options/ways to go. Finally, my friend spoke with his Dad and arranged a Car, and I would drive to Agra and back. This would be my first time to drive in New Delhi, and I was quite stressed, as the route and roads were alien to me. This is where the experience begins.
I took the metro, to reach the point, from where I would be taking the car. I had not traveled on Delhi Metro earlier as well. However, the directions and boards inside the metro station was very self explanatory. One needs to be completely dumb to miss it and go in wrong direction. After I changed to the second metro, and took the next train, I knew it was not actually going to the last stop, but it was stopping in between. So, I assumed, I would go to that station, and then take the next train to the last stop.
However, before 4 stops to the mid-station, the announcement started, if I have to go further than the station X, please get down at (x-1) station and catch the next train. Now this might sound minor, but was very important piece of info for a new traveler. Getting down at the station X would have worked, however, I believe, we would have to again run/jump or walk to a different platform to catch the next train. This can be completely avoided, if you get down one station early. Small, minor action, but very effective. Not to mention, before every station, there were two announcements, on which station was approaching and which side of the travel will the door open. Again minor, but very effective. These small but important announcement were instrumental in driving a complete different User experience. I felt like I was a regular in metro.
Once I picked up the car, the challenge was now to find the route and travel back to my hotel, which will be about 15-16 kms away. I had done my share of research over Google Maps, and found out way on how to come back. However, there were some direction changes required, and following them in the night is challenging. Again, Delhi’s UX came very handy. Before every junction, there was a board directing which major landmark a turn will lead me to. Before every roundabout, it said where all exits are about. At the junctions, there were again multiple sign-boards with the road name and the landmark or bigger road connection. Very soon, I was driving relaxed and confident.
Next morning, we started to Agra. We planned to take the Yamuna Expressway. However, it starts from Greater Noida. So we have to travel from Delhi to Greater Noida. The travel from Delhi to Noida was pleasant. With a brief glance at Google Maps, we were able to reach Noida fairly easily. All the directions and signboards helped immensely. However, as soon as we entered Noida, even the though the road was straight, we missed a turn. Why? Coz, it just spoke about the road name, and not where it will lead to. May be I was too carried away with the UX provided by Delhi, that I kind expected that there will be directions given till we reach Yamuna Expressway.
Small things matter a lot in User Experience. UX is not restricted to websites or products, but it is applicable to every element and communication that we do. To drive a great user experience, a total perspective has to be taken into consideration, and every small detail has to be worked out. If we leave one small detail, it might result in unpleasant experience for few people. Users today are very very used to great user experience, and once they have experienced great UX, if they stumble across a application/website/product with not too great UX, they will feel bad, and might have an unpleasant experience.
So, now it is my time to make sure, ShoppersOn gives a great UX to first and also regular users. Please suggest the areas of improvement on ShoppersOn.