Gaurav Kachru, CEO, Deals and You

Gaurav Kachru is the CEO of Deals and You, one of the fastest growing group buying websites, or as he prefers to see it, performance advertising solutions. Before this, he has worked with WPP, Yahoo!, ScanGroup and Group Buying Global AG. He has also been involved in the sister concern Fashion And You, and has been a part of Deals and You as a co-founder since its acquisition by the Smile Group.

What we do is actually not just group buying, which is the current buzzword, but actually performance advertising. In a way, we're actually the most cost effective way for a seller to reach and audience, and he's only going to pay for those deals which actually result in a sale for him. There is zero wastage and the advertiser only pays for acquisition.

Now that's only one side of the ecosystem. We need to put the advertisers in touch with the consumers, so we have to provide value to the consumer as well.

For the customer is, we get a group of them together to allow them to get a good discount, an offer that they can't put together for themselves all the time. Now, what is important is that we know about the consumers - they're educated, credit card holders, with high aspirational values and disposable incomes. The next step is to marry them to the right vendors. This matching is the key to creating an experience which my member will enjoy, so that he comes back to me.

What's important for us to note is that for our advertisers, it's not a discount model. It's a trial price model. That's really the key - around a third of the advertisers come back and around as many members also keep coming back for more deals from us. The key is to create loyalty, and the only way to do that is to provide real value to our members.

At the same time, we do a few technical things as well to make the experience better for our members. We do ‘cash on delivery’, and have worked on the mobile platform. The model as a whole is fine but there needs to be fine tuning at every stage to meet the demands of the customers.

And what is interesting is that the Indian consumer is very conscious of value. They will buy expensive products, but they will go for the best deals, and not let anyone make a fool of them.

One area we're very interested in is mobile, of course. The mobile space is huge, but it's also very difficult to crack. I don't think people have been able to use the mobile space as well as possible because there are some obstacles in the way. The biggest is in mobile payments.

Right now, completing a transaction from your phone is still not convenient. SMS is a horrible way of carrying out any transaction which needs more than one input, IVR is cumbersome but the only way to really carry things out, or you talk to a person and get an assisted service... The other day, I was on the phone with my bank for eleven minutes before I managed to speak to a human being. I'm from a generation which will do that, but the kids, the twenty five year olds who work with me, who are the target audience for most e-commerce providers today, they all thought there was something seriously wrong with me!

I think that the technology which could really be a ‘gamechanger’, and which could expand the size of the market very significantly, is if mobile payments are made a reality. The simplicity that will bring to a transaction is fantastic, and should such a system be implemented, we'd certainly be interested in trying it out, and I'm certain that a lot of other people who are working in the digital space would also be very interested.

We use a mix of things. We maintain a presence on social networks, and we do a lot of online promotion, and we also do some offline activities. Without going into too many details, I can tell you that it is important to find the right mix to reach out to people effectively. What's most important though, especially as people are becoming more aware of this option, is the quality of the deal you offer. There are dozens of options, and not just in the sites which offer these services. So you need to give the consumer something of value, and we do that by watching their tastes and matching against that. The growth we have seen over the last five months, where we've grown by 100 per cent on a month by month basis shows that we're clearly doing something right, and I think that we're among the key players in the industry now.

We are creating a whole ecosystem here, where we try and match our target audience with our advertisers in a way which creates lasting relationships. If an advertiser finds that the ‘walk in’s we send become regulars, he will hold more offers with us. If a customer finds a good deal with us, and has a good experience, then he will come back as well.

So the thing that we are most careful about is to match expectations from both ends, and create a high value ecosystem where we carefully screen out a lot of advertisers to ensure the best experiences for our members. In a way, a deal on offer from Deals And You is not just a discount, but also a recommendation. We carefully curate the best experiences, create packages for our members, like putting together a deal from a restaurant, and a taxi service and a club to create a full experience for a Christmas date.

We're trying to focus on creating high value transactions. This has two benefits – first, it makes matching the customer and the vendor simpler because certain expectations come into play. The other is that it leads to a better rate of adoption. If you paid only Rs 50, then you might not redeem the coupon, you might not go to the vendor. At Deals and You though, the average deal still costs you more than Rs 500, and we've seen that when a person clicks on a deal where he or she has already committed to spending that much money, they are much more likely to cash in on it. People are not going to waste their money, right?

The idea is to create loyalty by matching tastes with our customers. This is something which can only happen over time, it's not a quick process. But we're in this business for the long haul, which is really the way you have to approach any business – online or offline.