Why Service Startups Are Taking a New Path: Making Products

In what may seem like a natural extension in hindsight, Indian service startups are leveraging consumer data generated on their platform to understand market demand for specific products and expand into manufacturing. For example, home services marketplace Urban Company plans to launch its own line of water purifiers and is about to officially announce the product to users of its app, sources said.

From manufacturing reverse osmosis (RO) filters used by its service professionals during maintenance, Urban Company has now decided to expand into water manufacturing. There are plans to launch more products based on consumer interest in water purifiers, and hiring for product development is underway, the person said.

When contacted, Urban Company said it had been piloting water purifier sales since November last year. More than 1,000 users purchased the product during the pilot project, the company said, confirming its intention to manufacture and sell water purifiers under its own brand.

Similarly, social commerce platform Meesho had previously shifted from its reseller-led model to selling products directly to end customers, like Amazon and Flipkart. From selling unbranded products, he has now learned to partner with smaller brands to start offering branded products on his platform.

According to sources, more than 60% of Meesho’s transacting users come from its direct selling business. The company is looking to capitalize on this by partnering with smaller brands to launch branded products on its platform. Meesho did not respond to questions.

Before Urban Company and Meesho, several startups leveraged data generated on their platform to expand into new categories to increase revenue and attract investors.

Zomato recently dove into food delivery in 10 minutes thanks to the insights generated over the years from food delivery. This allows it to set up a network of grocery stores near neighborhoods with a high customer base. Stores will stock the best-selling items in each locality, with the estimated cooking time for these items being 2-4 minutes given the predictability of demand.

Competitor Swiggy has already successfully experimented with a cloud kitchen network in some locations.

Blinkit, which pivoted to deliver groceries in less than 10 minutes, opened a network of dark stores across cities based on consumer data it had collected as an online grocer in its old avatar. Groffers. Workers at these dark stores previously told The Indian Express that different dark stores may have different high priority items depending on the localities served.

The community safety platform MyGate, equipped with the data of residents of residential corporations using its services, had also introduced community-specific services such as enterprise resource planning solutions for resident welfare associations. to help with accounting, invoicing, and expense tracking, among other things. The startup had also launched a service called MyGate Club where major brands could interact with residents through curated experiences.

Not all data-driven expansions in the branded goods segment can succeed. In March last year, Zomato began selling nutraceuticals under its own brand which it shut down within six months after a quiet response from customers.

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