Economy

The big business of serving children’s needs

Priyanka Pani | Updated on March 24, 2013 Published on March 24, 2013

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From daycare, playschool-related queries to the details on fun events related to kids, one can get all information on mycity4kids, an online marketplace started by Vishal Gupta.

As a curious father of two young boys, Vishal has also faced several difficulties while seeking information regarding events and schools for his kids.

However, unlike other parents, Vishal felt that there should be one platform, where parents can not only search for information related to kids’ services but also look for recommendations and make bookings online.

After working for more than 15 years, Vishal decided to quit his job to help provide information regarding several services to millions of anxious parents in the country. The 38-year-old MBA from IIM Bangalore was the Director (Marketing) with Aviva Life Insurance till 2010 and had conceived several kids-oriented insurance plans in that company.

Vishal says that while handling the kids’ insurance products at Aviva, the company witnessed that within 12 months, the overall revenues from children policies increased from one per cent to 15 per cent. This is what again motivated Vishal to start a venture for parents and kids up to age of 14 years.

Supported by his co-workers from Aviva, Asif Mohamed and Prashant Sinha, Vishal floated the e-commerce firm in the same year by pooling in Rs 50 lakh of personal savings. Asif, an IIT Delhi alumnus, and Prashant, from Delhi University, were credited with developing some of the most successful child insurance policies.

In May 2102, the company got venture capital funding from YourNest Angel Fund. The company plans to raise another round of VC funding this year.

“We felt that while parents were willing to spend on the entertainment and overall development of their kids, there was dearth of information on such services in India. There weren’t any players which provided the same on a consolidated basis. That apart the kids’ services market in India was growing fast with some playschool or other mushrooming every month,” Vishal says.

Also with people shifting base regularly, as required by their job, it becomes easier for them to search for new schools, music classes and other entertainment zones for their children in the new city, he adds.

According to a McKinsey report, the Indian kids services market is pegged at Rs 15,000 crore, which included hobbies, sports, tuitions, daycare, playschools, recreation, entertainment, health and wellness besides information about places where to shop.

It further added that about 1.2 million were the target households present in the top 16 cities in India with an average expenditure of Rs 950 a month in every household. The average monthly expenditure on education and recreation is projected to go up to Rs 8,400 by 2020 from Rs 4,100 now.

While there are several players in the online products space such as babyoye.com, hoopos.com, firstcry.com, there is no other company in the country that acts as an online aggregator of all kids-related services, which mycity4kids plans to cater to.

Expansion plan

The portal went live in October 2010 with services and information meant only for Delhi and NCR. However, within a year of operation, the company was present in all Mumbai, Hyderabad, Chennai, Bangalore and Pune. By the end of FY 2014, mycity4kids aims to be present in the top 16 markets in the country and at least one international city.

On revenues, Vishal says the company’s earnings are in excess of Rs 1 crore a year at present but targets revenues of around Rs 30 crore by the end of FY2015. Besides operating in the B2C segment, where it receives about 6,000-7,000 visits per day with 30 per cent coming in as repeat customers, the company also acts as a B2B player.

In the B2B space, it provides solutions to small and medium enterprises in the children’s space ranging from helping them kick-start their presence on the Internet with a templated microsite to response management, payment and local promotion solutions available for Rs 2,500 to Rs 1 lakh a year. So far, the company has acquired over 30,000 businesses on its platform.

“In last 100 days, we have added about 400 SMEs. We have a robust calendar to add to the existing bouquet of services based on an in-depth understanding of the issues that owners face in running their businesses,” Vishal says. Future developments in the B2B space include enabling businesses to use social media efficiently, he adds.

Key themes

On the B2C space, the key themes for the portal are relevance, personalisation and guidance, which it delivers through features such as the personal profile, that includes a set of personalised recommendations, and the parenting stop and discussion forum which provide validation and guidance to parents.

However, this doesn’t mean that the journey had been smooth for Vishal in these two years. The first such challenge cropped up when one of their investor backed out of Rs 5 crore investments in January 2012 questioning the business model and adding that the market was too nascent.

“To tackle the situation, we just allowed our customers to search for any information in the city and get recommendations from other parents. We helped them shortlist places but did not quite enable them to complete the purchase process online,” Vishal says.

However, after a period of time the company found that this was an important function. “We, therefore, transitioned into a marketplace from an aggregator. The online booking functionality was started with an event to which 80 per cent of the tickets were sold through our Web site,” he adds.

> priyanka.pani@thehindu.co.in

Published on March 24, 2013
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