New Delhi: Rohit Bansal and Kunal Bahl entered a pact when they were students at the Delhi Public School. That they would acquire degrees and gain relevant work experience, but eventually wind back to work on a shared dream project of their own. 10 years later they have done precisely that. Rohit tucked in an engineering degree from IIT, Delhi and Bahl went to Wharton business school in the US, after which he worked at Microsoft. Cut to 2007 and they are back together, keeping their part of the deal. And ironically, ’deals’ are what their venture, Money Saver, is all about.
Bahl while in the US had what he calls one of his ”Eureka moments” when he saw Entertainment Publications, a leading provider of promotions and discounts – a priced catalogue-booklet that has hundreds of discount coupons of apparel, food, movies and gizmos, selling over 10 million copies a year across 156 cities to consumers who see it as a great bargain, for they recover the cost of the booklet within the first few transactions itself.
Kunal Bahl, CEO, Money Saver is a management graduate from Wharton
”Does India have anything like this?” is the question he put to his former school buddy Rohit, asking him to do a quick survey. Within a week the duo had put a concept together that looked inviting enough for Bahl to move back to India, and 14 months later they have just launched Delhi’s Money Saver guide and within the next six months will follow it up with Hyderabad, Mumbai and Chennai editions.
The booklet which would be valid for a period of six months, prides itself on being India’s largest collection of great offers from over 50 leading brands and restaurants comes with BOGO (Buy one get one free) and other money saving offers from top brands in five segments – lifestyle; retail and services; fine dining; travel and entertainment and casual dining.
Rohit Bansal, COO, Money Saver is from IIT Delhi
The entire model is based on the simple fact that everyone loves to strike a deal, to make a bargain and avail a discount. The research which their focus group discussions revealed was that Indian customers are not price sensitive, they are value sensitive. The perceive value not on the basis of whether they are getting the product cheap but if they are getting it cheaper. Money Saver stretches the concept to make it a win-win for all by feeding on ’dependencies’. Aiming to reach a target group of 15 million potential booklet buyers comprising young professionals, college students and housewives they know that this is exactly the same group that the expanding pool of retailers is trying to reach across the country.
The criteria for getting a brand on board was to ensure that the concerned business did not work on a frequent discounting model. There had to be price stability for the discount coupon to have a value tag. Which is why the Money Saver team is trained to show retailers how they stand to gain by signing up for the scheme, getting them to up their discount offers which are substantive from the consumer’s point of view and not flimsy like spending Rs2,500 on a meal and having just a beer free thrown in or a side dish that is not popular on the menu list.
A shopping guide that offered quality incentives to end consumers to them had immense potential of doing well, for the timing was just right. “Given the nature of the Indian consumer, in whose DNA is built in the relentless pursuit of haggling, the wow factor could be developed. Even in organized retailing, in fancy malls offering international brands, you will find the most sophisticated customer asking for a discount. It is not so much a question of the rupees that he or she would save but the satisfaction that he would get at netting a good deal that makes the buying experience more wholesome and gratifying”, says Bansal.
As they worked on setting up a supply chain of having incentivized ticketed purchases, they realized that in India there was a market for those who planned their purchases, but there was an even bigger market for those who made impulsive buying choices. You go to watch a movie and end up buying a t-shirt or you step out for dinner and return with an armload of cosmetics and DVDs. To reach out to this segment of unplanned shoppers who are seized by the moment and tempted to loosen their purse strings, they created a mobile platform.
By having a proprietory SMS-based platform on demand, they could service clients/ users who had chosen this option for availing periodic announcements through SMSs on deals that were relevant to them. So if you happen to be in an electronic store and see a Money Saver sticker on the glass door, you just walk up to the sales person and ask what the special deal for you as a Money Saver subscriber is and follow it up with an SMS to the company, who within minutes will send you your coupon via SMS, allowing you to make your discounted purchase.
This is an operationally complex task wherein Money Saver area managers build relationships, set up frequent touch points and sign up legal agreements with stores that have offered discount coupons. To ensure acceptability and good customer treatment, the stores will be visited once a week and provided with handy resources and quick user guides.
For Bahl the concept translated into a simple model that provided you an opportunity to save money on anything that you bought. While the task looked intimidating and unmanageable, he broke down complex tasks into doable sub tasks. Building platforms, testing it, running limited pilots, getting the right people, they managed to tie up with so many brands for a single initiative. All tie-ups are at a national level and since it’s a highly scalable model, it can be replicated in other cities. Deciding which city to include on their list is based on a supply-demand ratio which is how Gurgaon, Chennai and Bangalore offer tremendous opportunity.
Costs have been kept frugal. They saw that to get the right people to do business development would be management graduates but given the expectation of phenomenal salaries, it was a cost they were not yet willing to factor into the project. An alternative plan was worked out. They reached out to top colleges like St. Stephens in New Delhi and through the college placement cells made presentations to under graduate students. This landed them their first set of interns who were smart, passionate and result driven. For every client they bought on board they were paid a fixed amount plus their actuals on transport and mobile usage was reimbursed. More than 15% of the first booklet has come through this route. Their simple and uncluttered website, www.moneysaver.in has already been deluged with enquiries.