Forbes India and AWS in association present 'The Mavericks', founder conversations to share with people the experiences of innovative business leaders and the strategies employed by the industry's true mavericks in the age of the digital native. Engaging interactions with digital native executives will be featured throughout the year-long campaign, where they will discuss their rethought company strategies, technological capabilities, and future vision. For those seeking answers to their problematic organizational structure, this will be the guiding light.
In a conversation moderated by Brian Carvalho, Editor at Forbes India, and founders Amit Kumar, CEO at OLX Group India, and Bhupendra Kumar, Head at DNB, AISPL, they discuss how OLX Auto stacks up in the competitive digital used car space and how it is differentiating itself from the competition. Also, they discuss how AWS innovations are helping OLX improve productivity and efficiency.
OLX started operations in 2009 in India. How has the business pivoted since then? Sharing his thoughts on this Amit said, "It's been a long journey of the past 13 years with OLX being a pioneer in the country. Used cars or used products, buy or sell, used to be a stigma. People did not like to either buy or sell used products.
This is when OLX came into the picture as a platform facilitating consumer-to-consumer hyper-local trade. Our journey can be divided into two buckets; the first time period started from 2009 to around 2017 when we were focused on consumer needs of buying or selling used products, using an app-based ecosystem in a hyper-local manner. We were very successful and OLX gained a very strong consumer mind share and a strong position in this segment.
In 2017, we again did a reassessment of evolving consumer needs and what our strength areas were. When we looked at the OLX platform, we realized that some of the most vibrant categories where a lot of transactions were happening between consumers, between businesses and consumers included user cars, goods, and mobile phones.
We also saw a growing need in the used car segment amongst consumers who did not want to go through 10-15 hoops of posing a car on a platform, talking to 10-15 buyers, and then making the transaction. This urged us to bring an end-to-end consumer experience that starts from helping the consumer sell the car to a platform like OLX and then selling that car with value-added services to a buyer. "
Today, used cars are at the core of the business. Talking about the pivotal moment and the trigger at that time to focus on used cars he said, "This transition took place between the second half of 2016 when we took the strategic call to scale up by the end of 2017. At the core were two or three big drivers.
The first driver was our understanding of the evolution of consumer needs. When we did consumer research, we saw in the more digitally savvy places a need to reduce the hassle of end-to-end transactions. In the traditional form of used car transactions, there are several pain points; What is the price of my car? Who should I sell it to? Is it the right price for my car? Is that a reliable car? Upon analyzing these needs we realized that our current platform was not serving this new set of consumers. This is when we really decided to expand."
OLX online classifieds platform is a very large platform that attracts traffic across categories and geographies. More used cars get listed on their platform than they get transacted in this country. Around 20,000 used cars get listed in a day and around 450 to 600 thousand used cars get listed in a month. Looking at the projections the used car market is about four and a half to five million cars in a year. On the demand side, more than 20 replies come on a used car within 72 hours, and Autos is their most liquid category with more than 1.1 million buyers looking at these used car categories.
Talking about the role of technology in this segment, Bhupendra Kumar said, "With the current sales, we are already the fifth largest market for second-hand cars in the world. We expect the sales to reach 8-10 million in the next couple of years. With the growth of the sector due to major players, there is a need for technology to deliver a seamless experience to buyers and sellers on their platforms. Our purpose built-solutions such as personalization and recommendation, live commerce and augmented reality, and enhanced customer engagement solutions that aid end customers meet their needs."
To watch the complete session video: