Hyperlocal businesses are here to stay. It’s not just we, who are saying it. Surging VC (Venture Capitalists) interest backed by roughly $140 million raised by companies across 28 deals in India, bears testimony to the growing hyperlocal business ecosystem. Moreover, it’s not just the VCs that adore hyperlocal model. This business system is proving to be a hit among customers too. With rising smartphone penetration and increasing stability in mobile transactions, customers face a world of convenience, thanks to the hyperlocal business model.
Need more compelling reasons to support going hyperlocal? Then read on how hyperlocal comes up as an exciting value proposition for both buyers and sellers.
Benefits for sellers
1. Expanded coverage
How else can small shops such as mobile repairs, handymen, housekeeping providers or grocery outlets, expand their reach, than with hyperlocal business model? With near zero marketing costs, they simply need to worry about getting the right service or product to customers.
2. Brand visibility
Hyperlocal model helps smaller service or product providers to craft a distinct brand presence. They can quickly build a loyal online audience. With quality servicing, it becomes very easy to garner repeat business from satisfied customers. Take HouseJoy’s case- with a good plumbing job, a customer will be likely to visit HouseJoy for other household work, such as electrician requirement or furniture cleaning.
3. Selling opportunities
With hyperlocal, there is a tremendous potential for up-sell and cross-sell by retailers. For example, if users discover a fine dining place nearby, it is more than likely that they will visit it more times than just once.
4. Decrease shipping costs
Hyperlocal intermediaries can easily pass on the shipping costs as well as logistics overheads to retailers or customers. This way they can prevent additional overheads, and thus, remain sustainable in this ecosystem.
5. Venture Investment opportunity
Grofers’ $35 million funding by Sequoia Capital and Tiger Global, and Zopper’s $20 million funding by Tiger Global and Nirvana Ventures, show how attractive hyperlocal has become to VCs. So much so that some players like Tiger Global and Sequoia Capital are invested into multiple such startups.
6. Ward off competition
With the muscle power of large e-commerce players like Amazon, it was becoming difficult for smaller retail shops and local businesses to compete. With hyperlocal, sellers too get equal footing in terms of exposure to a wider audience who do their purchasing online.
Benefits for customers
whether it’s hiring a maid, ordering food, getting your AC fixed or having groceries delivered, you can get these and much more at your doorstep. Hyperlocal model helps match demand with nearest available supplier.
2. No extra cost
Grofers consolidates orders from multiple shops and delivers them to your doorstep. You need not step out to buy goods or spend time rummaging through various local shops. What’s more, you don’t even have to pay anything extra! That is the magic of hyperlocal for you.
3. Innovative bent of mind
Hyperlocal business models are proving to be major retail disruptors. Some of the business models revolving round this ecosystem are simply mind blowing. Even as small a thing as plumbing or electricians can be availed off using the hyperlocal model on offer by companies like HouseJoy or UrbanClap.
4. Alignment to mobile
With location based services, GPS and maps, customers can easily uncover additional layer of information in the nearby places and business establishments that are going hyperlocal. So if you get hungry, simply download Food Panda and get recommendations based on your location.
5. Lifestyle Shift
Bangalore based Srikant Govila has been using Ola Cabs since 2013 and has never used an auto ever since. Even when he has options available, he prefers riding an Ola Cab. This attractive dependency also signals a shift in lifestyle preferences brought about by hyperlocal businesses.
Discovering food outlets and convenience stores in the neighborhood has never been easier. With proliferation of smartphones, users want to know in real time what facilities are available around him or her, and services like Zopper and Uber cater to this need.
A lot of excitement and buzz is building around hyperlocal as a sustainable business model of the future. These advantages are coming up as prime success drivers for this new ecosystem.
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