Hey you bloggers we are back again with another stunning interview session!
As part of our BloggersIdeas interview series, today we have Entrepreneur Ravitej Yadalam From Pennyful, he is skilled entrepreneur who would be sharing his experience in entrepreneurship journey, his startup Pennyful.in is today India’s largest coupons and cash back shopping website with 250+ partners and thousands of happy shoppers.
Lets start the interview session with Ravitej.
Please tell us something about yourself and your educational background?
I am Ravitej Yadalam, CEO and Founder, Pennyful Online Pvt. Ltd. I had completed my ICSE from The Valley School in Bangalore and my B.E. in Electronics and Communication Engineering from R.V. College of Engineering, Bangalore
What is Pennyful, and how does it work?
Formed in November 2011, Pennyful.in is one of the first and best online cashback sites in India. As one would know, the Indian market is extremely cost conscious.
Bearing this in mind, Pennyful was created and brought into India to help customers save on their online shopping. But what is important to realise is that when we say save, we mean earn.
Customers who shop through Pennyful stand to get back a part of their spendings to their Pennyful account, which they can either choose to accumulate, or withdraw into their bank account.
And the concept of cashback, which we brought into India, is now gaining traction in India at a rapid pace. Today Pennyful.in works with more that 250 of the top ecommerce retailers, across various verticals.
In short, Pennyful works on the affiliate marketing model. What this means is that we direct our customers to our partners, for instance, Amazon.in. For every sale we help generate for Amazon.in, Amazon.in pays us a commission. It is this commission that we share with our customer as cashback. This way all parties win.
How did the concept of Pennyful come to you?
The concept of Pennyful came to me back when I was in college. I always found the ecommerce space fascinating, and I began experimenting with the idea in college during the 2007-2008 timeframe.
During this period I found myself working with some market retailers to sell products and it is here I witnessed a very significant trend in consumer behaviour. This consumer behaviour would define the conceptualization of Pennyful.
Generally, Customers preferred branded products over unbranded ones, in spite of the latter having just as many features at a lower cost, and this revelation made me move my ecommerce experiments to the affiliate marketing space. By doing this, I was able to tie up with large brands and deliver to customers the products they wanted.
While doing this helped solve the problem of selling large brands, I saw that there was another challenge at foot, that of customer loyalty. There were many sites which offered the same product at the same price. So the question I asked myself was, “How can I make my customers choose me over my competition”
The answer was to offer my customers something which others would not offer, to ensure customer stickiness. And I realized that through affiliate marketing, I make an ‘x’ amount of money as commission, and if I shared part of this to my customers as an incentive, I would be able to deliver the best customer shopping experience. And the feedback I got for this model was incredible.
This is how Pennyful Online Pvt. Ltd. was born
What are some of the challenges you faced while starting Pennyful and in bringing the cashback concept into?
One of the biggest challenges we face in India is that cashback, as a concept, is still relatively new to the market. Hence, for us, as a cashback company, educating our customers still remains a priority. At times, it seems that receiving your money back is too good to be true, and is often misconstrued as being the same as a discount.
But once our users see that there is actual money coming back into their bank account, they become believers and some, evangelists of the concept.
What are the Secrets of Affiliate Marketing and are you associated with any kind of affiliates?
Pennyful is an affiliate to all our partner e-commerce sites (advertisers). The secret to afiliate marketing is building a large customer base and connecting the right customer with the right advertiser.
What is MediRupee and how does it work?
Based on the success we saw with Pennyful.in, we decided to extend the concept to the offline healthcare space. The reason we chose healthcare is because, based on our preliminary research on the subject, about 9% of an average Indian’s income goes towards health expenses and the number can sometimes go upto 50% for middle and lower income households.
And a majority of the expenses happen out-of-pocket. A large number of Indians do not have insurance, and even if they do, no insurance covers the entire gamut of healthcare services.
This is the principle on which MediRupee came to my mind. I worked with my friend Manu Swarup to bring the dream of MediRupee to life on March 2013.
MediRupee works the same way as Pennyful does, but is focused on the offline healthcare segment. Customers can sign up for a MediRupee account at no charge and through this account, they can get cashback rebates on their healthcare expenses. Today MediRupee works with over 180 healthcare institutions, across 6 major cities.
What has the reception been so far for both Pennyful and MediRupee?
The reception we have received for Pennyful.in in India has been tremendous. We have received great feedback from our customer and, in truth, the response has been overwhelming.
We did expect to see positive traction for the site, but the way our customers have been reacting to receiving their money back from us makes me know that we are on the right track.
Even for MediRupee, which is relatively new, the traction has been very positive. We are the first player to bring the cashback concept into India and the only company to bring in such a concept to the Indian healthcare market and the feedback has been great.
How did you promote your startup among the youth? What promotion strategies you applied to your business to make it more visible in online marketing.
On Social Media Facebook, Google, Twitter, LinkedIn, Google+, YouTube, Pinterest and Instagram are main ways we reach out to our audience.
We promote the website on all search engines be it Google, Bing, or Yahoo
We are also working on creating partnerships with corporates, schools, colleges to get the word of Pennyful out.
Also, as customer acquisition is obviously important to us, we encourage our users to share Pennyful.in with their family and friends and also reward them for doing so. In order to do so, we came up with a Refer-A-Friends policy, wherein our customer gets 10% of his referrals’ cashback whenever they shop via Pennyful.in for one whole year.
How the idea of entrepreneurship came in into your mind. Did your family support you for this?
I believe that the entrepreneurship spirit was always in me. As I mentioned above, the concept for Pennyful came to me when I was in college, which means that the urge to create something of my own was always present. If it wasn’t for Pennyful, I do not really know what else I would be doing.
My family noticed this drive in me. They understood I was passionate about being an entrepreneur and supported me and my decision wholeheartedly. After all, Pennyful is completed funded by my friends and family. This proves that they believe in me and the concept.
What suggestions you would like to give to young guns of India who are planning to become an entrepreneur, as in India entrepreneurship for parents is still risky.
Entrepreneurship is always risky. There is no way around that. It’s all about finding what you are really passionate about and find a way to make it an economically viable business.
It’s also important to make sure that you have a backup plan in case things go south. I think it’s great if someone wants to start up, but I would not advice putting all your life savings in it. The good news is, if you’re solving a real problem and have a real plan in place, there is enough capital out there to back you.
If you have any questions or doubts about this interview, please do ask in the comments below !