Let’s breakdown the term ‘Hyperlocal’ first and then delve deeper into the details of Facebook has done!
Ecommerce retailers when maintain their own stock of products and operate their own warehouses, it gets termed as inventory based management. On the other hand when they just source it from the local stores and make them available to the customer, whereby, the buyer and seller are located in close vicinity, it gets termed as hyperlocal.
The social networking giant, Facebook has now ventured into this segment in India, which is nothing less than a nightmare for existing players like UrbanClap, QuikrServices and Zimmber.
This move by Facebook was a ‘shush-shush’ affair, which will help customers discover the best rated service providers around them ranging from healthcare to plumbing to personal care and to automotive(repair). Apart from allowing to browse through array of service providers, it will also assist you with reviews and ratings as well. Currently there are 80 services listed under 110 broad categories.
The site is very easy to access that too through personal Facebook accounts, does not seek registration money and demands only a picture and contact details. With a staggering 140-150 million monthly active user base that Facebook has in India, competitors in this segment need to worry and yes they’re justified in doing so.
According to the reports of startup tracker, Tracxn, the hyperlocal services market has seen a lot capital inflow in India in the past few years and the ‘n’ number of startups operating in this much crowded place have raised around $180 million in funding in aggregate. The average number of orders received by these hyperlocal operators in India, ranges between 4000 and 6000 orders daily. Although termed as unorganized sector, the opportunities in this segment are estimated to be worth $100 billion to $400 billion. While the existing players in this segment charge around 10-30% from service providers for each transaction. However, Facebook has not started charging service providers for using ‘Facebook services’ as of now.it is focusing on encouraging users to review and rate each service provider on its platform. Even though, their monetization strategy from this particular segment is not clear, it is expected to generate significant revenues for them in the light of the expected growth in the Indian economy.
An additional feature that might help Facebook strengthen its hold in the hyperlocal segment is that you can also get recommendations from your friends. So, if you are in a different city, just log on to Facebook and ask your friends, ‘where can I get a good hair spa in the town?’ or ‘where do I go to get my broken car repaired? The competitors will also have to make the interface of their apps and websites to tackle Facebook on this front. But it seems a little troublesome as if compare don the scale of convenience people might prefer one single app that is Facebook for socializing as well accessing services.
Let’s wait and watch how tables turn, if at all they do!
Team iMET Global
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