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Q: How is IndiaMART leveraging its platform to empower the MSME sector in India, and what specific tools or services have been most impactful for these businesses?
Over 28 years, IndiaMART has evolved from a simple listing platform into a comprehensive business solution for MSMEs, with the single objective to make doing business easy. Today, MSMEs face majorly four challenges – access to market, access to technology, access to people and access to finance and our focus is on solving these challenges for MSMEs
Empowering MSMEs with Access to Market: .Our platform is integrated with AI to ensure behavior-based matchmaking, multilingual search options, price discovery, voice-based searches, processing ‘Hinglish’—a mix of Hindi and English to offer precise search results, conversational commerce, and transparency through comprehensive supplier catalog pages and trust-building measures like user ratings, reviews, and TrustSEAL Verification.
Empowering MSMEs with Access to Technology: We enable businesses with online webstore coupled with a comprehensive set of tools including cloud telephony, CRM platform called Lead manager, product testing, lead generation, analytics and complete customer experience (CX). The sellers also have the freedom to manage their catalogue with features such as automated image editing, background removal, and cropping and finance solutions to manage accounting and invoicing better.
As per various studies, inadequate knowledge about affordable tech solutions remains the biggest impediment in digital transformation.To educate MSMEs to start their digital journey, we have set up our own offices as well as channel partners across the country and we do approx. 15 lacs connects per year with them. Our team connects act as the biggest enabler for these businesses to get their basics right about digital tools and adopt a digital first marketplace.
Q: Digital transformation is widely regarded as a catalyst for the growth of the MSME sector. How do you see this trend playing out in India, and what role does IndiaMART play in facilitating this transformation?
Today, only 5% of MSMEs are fully digitized. With customers embracing technology in their daily lives, it has changed their buying habits and behavior. There is a wide tech adoption across sectors and businesses’ operational processes. MSMEs, in particular, are turning to technology to expand their reach, streamline operations, and improve customer experiences across sectors. Adoption of drone technology, increased use of UPI payments, e-governance, smart infrastructure, 5G for education – adoption of technology is reflected well across sectors. Tier II, III cities are actively using tech to not just keep up, but also build their own businesses. Interestingly, of the 115,000 start-ups registered by the DPIIT as of December 2023, around 50% were based in Tier 2 and 3 cities. A Deloitte report stated that the surge in smartphone users particularly benefits Tier 2 and Tier 3 cities as e-commerce grew by 64% and 50% respectively. Today, 63% of e-commerce orders originate from these smaller cities, reflecting how well digital has transformed rural India. From the launch of Atamnirbhar Abhiyan, Digital India, Startup India, Mudra Yojna to GST reforms, the Indian government is making strides to ensure faster digitalization of MSMEs in India. By embracing digital tools, MSMEs can showcase products, personalize marketing, optimize logistics, and enhance customer engagement, ultimately delivering greater value. This digital ecosystem is leveling the playing field, enabling MSMEs to scale, reduce costs, and achieve sustainable growth. For MSMEs residing in tier II, III cities, the rapid digitalization, lower operational costs and customers’ increasing demand for premiumization are catalyzing their digital journey.
IndiaMART is committed to fasten MSMEs’ digital journey by offering AI-enabled enhanced search, Vernacular Voice Search, enriched user-friendly content (products with quality, images, videos, and PDF), behavioral data-driven algorithms and extremely simple plug-n-play module, that opens vast business opportunities for them globally. Our strategic line of investments in businesses like Busy, Vyapar, RealBooks, SuperProcure, also aim to provide digital solutions to the long-ridden traditional paperwork, vendor management, accounting issues in the MSME sector, thereby fastening their digital journey even more.
Q: How has the B2B sector in India evolved over the past few years, and what are the key trends driving this growth? How is IndiaMART positioning itself to capitalize on these trends?
The B2B sector is expected to grow at 28% CAGR from 2021 to 2026, reaching $54 billion. This reflects the huge potential that still lies untapped in the sector currently, waiting to be explored. Digital continues to be a key trend in the b2b sector, with businesses becoming more agile towards trends like online marketplaces, AI, and enhanced focus on CX. Buoyed by the PLI schemes (over ₹1.03 lakh crore attracted since launch) and increased spending on infrastructure, domestic manufacturing activities in the B2B sector are also expected to pick up. The emergence of OCEN will also pave standardized integration through APIs, boost interoperability, streamline credit access and enable personalized loan products. The ongoing startup wave will impact the b2b sector as well, with businesses inviting interests from fundraisers and VCs. These trends are emerging not only in major cities but also in smaller towns and rural areas.
IndiaMART has been at the forefront of the B2B revolution in India and we continue to remain committed to our vision of empowering businesses. We have realized that voice commerce has the potential to lead to hyper-personalization, removal of language and geographical barriers enabling millions of businesses. Thus, we have been supporting vernacular and voice-based search for 6 years and Hinglish search. We currently allow users to navigate the entire website in English and Hindi while supporting searches in 243 languages. Additionally, voice search is available in nine languages: English, Hindi, Marathi, Tamil, Kannada, Telugu, Gujarati, Bangla, and Malayali. The integrated Lead Manager helps lacs of business converse seamlessly across geographies. All these tech interventions have resulted in almost 70% of buyers from Tier II, III towns and smaller geographies getting serviced through our marketplace.
Q: While IndiaMART is primarily a B2B platform, do you also support retail or small-scale transactions? If so, how significant is this segment for your overall business strategy?
IndiaMART is a B2B platform, connecting buyers looking for bulk quantities of product. Given the core focus remains on the wholesale business, we have observed that many retail buyers also visit IndiaMART looking for more sellers, wide selection, competitive pricing and variety of products available.
Q: What recent innovations has IndiaMART introduced to improve B2B commerce?
From the use of AI to enhance the matchmaking process to driving stronger cybersecurity to create a seamless and efficient user experience, we continue to carry our legacy of innovation and make the digital journey of users easier each day. Our recent innovations include:
- Improvement in search: Our search capabilities have been upgraded to handle approximately 6.5 million monthly misspellings and ‘Hinglish’ searches, through sophisticated AI algorithms. This enhances precision and relevance in search outcomes and ensures near to accurate results for users regardless of any language or typing errors.
- Integration of AI/ML: Currently, we have a repeat buyer rate of over 53%, credit to our tech-driven solutions that make it easy for buyers to find what they are looking for. The seamless integration of advanced AI-powered tools for product catalog management such as automated image editing, background removal, and cropping, making it more visually appealing are some more use cases.
- Conversational commerce: Our lead manager, an integrated CRM platform, allows sellers to manage all their conversations with buyers in one place efficiently. It uses AI-driven suggested replies, significantly reducing response times, supporting personalized interactions and creating a virtual environment that mimics human interactions, resulting in more meaningful engagements and improved sales outcomes. We also support WhatsApp integration such that the buyers have to do minimal clicks to make their journey on IndiaMART faster and better.
Q: What are IndiaMART’s future plans for expansion, both domestically and internationally? Are there any new markets or segments you are particularly focused on?
We are a proud Made in India, Made for India’ company. Our 28 years of operations has been focused to empower businesses of India, within the country and outside by driving export and domestic buying requirements. We continue to strengthen the Indian MSME sector and help solidify the position of our sellers in India.
Q: From which regions do you see most of the demand coming from? What preferences change do you see in the new age consumers?
A significant portion of our buyers (71%) and sellers (58%) are located in non-metro and Tier 2 cities. Notably, approximately 38% of registered suppliers also engage as buyers on our platform. The top cities from a demand perspective continue to change, depending on the weather, ongoing trends and consumer preferences. For instance, the demand from north India is bound to rise around cooling components in summers, as the end consumer looks for cooling appliances. However, in the last financial year, metro cities including Mumbai, Bangalore, Delhi, Pune, Hyderabad, Chennai topped the charts in sending buying requirements followed by Ahmedabad, Kolkata, Thane and Jaipur tier II cities.
Q: Any significant partnerships or collaborations that IndiaMART is looking at?
So far, we have invested in 16 businesses and all these investments have been in businesses that are primarily adjacent to our core business. Our latest investment includes a 10% stake in Baldor Technologies (IDfY) to offer SaaS-based solutions for businesses including KYC, Background Verifications, Risk Mitigation, Digital Onboarding and Digital Privacy. We also have 66% stake in LiveKeeping to bring the tally data of sellers on the mobile and web. Over time, we aim to acquire 100% stake in the company.
Additionally, Busy, our accounting software has also been launched on the mobile app, making it the only native old accounting software that comes with the bundled mobile app on the platform. Today, web and accounting are two segments for us, but they will be two separate lines of business over time. We will continue to make investments to further strengthen our value proposition, improving customer experience, and leveraging growth opportunities, on the back of a strong balance sheet and sustained cash flows.