How meesho is different from other shopping websites and The Rise of Social Shopping

The Transformative Power of Social E-Commerce

Online shopping has undergone a remarkable transformation with the rise of social e-commerce. This innovative model seamlessly combines the power of social media and e-commerce, revolutionizing the way people buy and sell products. By leveraging social networks and messaging apps, social e-commerce platforms facilitate transactions and create an immersive, personalized shopping experience.

The widespread adoption of social media, the increasing popularity of mobile shopping, and the desire for more interactive and engaging retail experiences have fueled the growth of social e-commerce. Platforms like Meesho, one of the leading players in this space, have tapped into the growing trend of influencer marketing, where individuals with large social media followings promote products to their audiences.

Meesho : Empowering Micro-Entrepreneurship

Meesho , a prominent social e-commerce platform based in India, has carved out a unique niche by empowering individuals, particularly women, to start their own online businesses. The platform offers a diverse range of products, from fashion and accessories to household items, which resellers can promote through popular social media channels like WhatsApp, Facebook, and Instagram.

Meesho 's business model operates on the principle of micro-entrepreneurship, enabling individuals to leverage their social connections to generate income. The platform sources products directly from suppliers and manufacturers, while resellers earn commissions on each sale they make. This approach allows resellers to create virtual storefronts, manage customer interactions, and build their businesses while Meesho handles logistics, payments, and customer support.

Meesho's unique business model not only empowers individuals to become micro-entrepreneurs but also sets it apart in terms of profitability. Unlike many other e-commerce platforms in India that operate at a loss to drive growth, Meesho is committed to maintaining profitability. It has managed to control marketing and tech costs while maintaining revenue levels, making it a unique and sustainable player in the market.

While industry giants like Amazon and Walmart have pumped over $22 billion into the Indian market since 2014, commanding around $20 billion in online sales each and a combined 60% market share, Meesho is responsible for about $5 billion or 7% of India's total online sales. However, Meesho's focus on profitability positions it as a unique and sustainable player in the market.

In contrast, Flipkart, one of Meesho's major competitors, burnt over $3.7 billion in cash in about a year till September 2022, exhausting the $3.6 billion it raised in July 2021. Flipkart's promotional expenses alone amounted to ?1,946 crore in FY22, while Meesho managed to get its marketing costs down by 80% and tech costs by 60% over the last year, maintaining revenue levels.

Meesho's success can be attributed to its focus on empowering individuals, particularly those seeking supplemental income or flexible entrepreneurial opportunities. The platform provides resellers with tools and resources for inventory management, marketing materials, and training to help them succeed. Additionally, Meesho fosters a strong sense of community, where resellers can connect, share experiences, and learn from one another.

Market Growth and Meesho's Position

India's e-commerce market is on the rise, with expectations of significant growth in the coming years, especially in smaller towns and villages. Meesho is well-positioned to capture this market share, given its focus on micro-entrepreneurship and its ability to cater to a wide range of consumers through its reseller network.

During the festive season in 2022, Meesho surpassed Amazon in order volumes, while Flipkart led the overall market. E-commerce firms like Amazon, Flipkart, Meesho, Reliance's JioMart, and Tata Group ran various parallel sale events, resulting in a robust 27% year-over-year growth, clocking a sale of $5.7 billion (?40,000 crore), according to a report by Redseer.

Meesho emerged as the second-largest player by order share in this year's festive sales, surpassing Amazon, while Flipkart Group platforms topped the market in both orders and gross merchandise value (GMV).

It's important to note that while Flipkart and Amazon's average order value (AOV) ranges from ?1,500 to ?2,500, Meesho's average order value is around ?500. However, Meesho's profitability and focus on sustainable growth are its silver lining, setting it apart from competitors operating at a loss to drive growth.

The Power of Social Connections

Social connections lie at the heart of social e-commerce's success. Purchasing decisions are often influenced by recommendations from trusted friends, family, and influential figures within one's social circle. Social e-commerce platforms leverage these connections to build trust and credibility around product recommendations, fostering a sense of community and belonging among users.

Moreover, social connections enable personalized product recommendations based on individual interests and preferences, as well as the recommendations of those within their social networks. This level of personalization enhances the overall shopping experience, making it more relevant and tailored to individual needs.

Word-of-mouth marketing also plays a crucial role in driving sales on social e-commerce platforms. Satisfied customers can share their positive experiences with their networks, leading to organic promotion and increased sales.

Becoming a Seller on Social E-Commerce Platforms

For individuals interested in becoming sellers on Meesho or similar social e-commerce platforms, the process typically involves registering on the platform, selecting products to sell from the available catalog, promoting and selling those products within their social circles, and managing orders through the platform's interface.

The seamless integration of social media channels and messaging apps into the selling process allows resellers to leverage their existing social connections, share product details, images, pricing, and engage with potential buyers in a more personalized and interactive manner.

Looking Ahead

Meesho, has recently secured $275 million in funding. This funding round was disclosed in a securities filing and is part of a larger financing round that is likely to include secondary transactions and balloon to over $500 million. The startup, headquartered in Bengaluru, operates an eponymous social commerce platform and is currently valued at approximately $3.9 billion in this new funding round. Notably, Meesho was valued at $4.9 billion in its previous funding round back in September 20211. The company has raised a total of $1.1 billion in funding across 12 rounds, with its latest funding coming from a Secondary Market round on October 13, 2023. Meesho’s growth has been impressive, capturing the attention of value-conscious customers in smaller Indian cities and towns. With over 440,000 annual transacting sellers and a wide assortment of products, Meesho continues to make strides in the Indian e-commerce landscape2