Snapdeal inks 50:50 JV with cable network Den for TV shopping channel
Delhi-based Jasper Infotech Pvt Ltd, owner of Snapdeal, the second-largest e-commerce company in India, has formed 50:50 joint venture (JV) with cable TV distribution network, Den Networks Ltd, to extend its reach to TV home shopping audiences.
The entities will together set up a TV channel, which will be used as a marketplace platform for facilitating the sale of branded and unbranded merchandise and services, including vouchers offered by third-party sellers.
Although a clutch of home shopping TV channel ventures have branched out into e-com as well, including Star CJ and HomeShop18, this is one a few reverse moves besides Naaptol, which is floating an independent channel.
Based out of Delhi, Den claims it is reaching an estimated 13 million households in over 200 cities across 13 states in the country. Founded in 2007, the network is currently available in Delhi, Uttar Pradesh, Karnataka, Maharashtra, Gujarat, Rajasthan, Haryana, Kerala, West Bengal, Jharkhand, Bihar, Madhya Pradesh and Uttarakhand.
Snapdeal was started as a pure online deals site and later it pivoted to a full-fledged horizontal e-commerce company via a marketplace model in September 2011. It offers over five million products across more than 500 categories. The company claims to have over 25 million members and 50,000 sellers, and is delivering in more than 5,000 cities and towns in India. It further claims to have witnessed 600 per cent growth year-on-year for the last two years. The current team size is 1,500.
The firm recently received an undisclosed amount in funding from Ratan Tata, former chief of Tata Group and currently chairman emeritus of group's holding company Tata Sons. Prior to this, Snapdeal had raised around $320 million.
Snapdeal's rival HomeShop18.com, part owned by media major Network18, claims a combined reach of over 250 million consumers coming through its integrated television, internet and mobile device channels. It claims 8.9 million consumers have placed orders with it since its launch. The company recorded 290,000 downloads of its iOS and Android apps as of December 2013, and its delivery footprint included more than 3,000 towns.
HomeShop18 recently filed its prospectus to raise a total of $75 million through a listing on the New York Stock Exchange (NYSE) including an offer for sale by some shareholders such as its CEO and parent Network18. The company is part of diversified media house Network18 (now controlled by Reliance Industries) and is backed by PE firm SAIF Partners and funds managed by OCP Asia. It also counts South Korea's GS Home Shopping as a strategic investor.
(Edited by Joby Puthuparampil Johnson)