What Happend to Askme?

Shivam Singhal
Jun 14, 2018
4 min read

All of us have seen the ad where Ranbir Kapoor is trying to hit on a girl, but it does not work. Later, when she is confused about shopping and wonders “Isn’t there an easier way?” he jumps in with Askme App as the solution and saves the day. One solution to all problem, the Askme app. Ever heard of this e-commerce website which was quite popular in India for a while because of its online businesses of the shopping site. Rings a bell, right?

That is exactly what the Askme Group aims for: to be the prime discovery channel for every shopping need, in cities small and big. When it launched AskmeBazaar, a horizontal marketplace for smaller and medium enterprises (SMEs) in 2012, other startups like Flipkart and Snapdeal had already set foot in the country’s e-commerce scene. But AskmeBazaar took a different route.

Instead of keeping an inventory or logistics options like other e-commerce websites did, it took e-commerce to the small sellers in smaller towns. AskmeBazaar started with small-town sellers who were aspiring to start their business online. Although it was a phenomenal struggle to get them to manage the technology, conducting e-commerce with hyperlocal businesses has a major advantage: items can be collected and delivered locally.

AskmeBazaar’s parent company Getit Infoservices was publishing Yellow Pages for decades, by collecting merchant listing in every city across the country. By 2006, the Indian retail ecosystem had started moving away from print to digital data assimilation. Thus, Askme Group’s marketplace model started in 2012 as Askmebazaar. They went to the wider side of the pool – to the smallest of possible SMEs who were not the typical sellers on eBay or Flipkart.

But headlines from the past year have recorded the slow, painful demise of AskmeBazaar — the promising Indian startup that went up in flames but whose intro on the Google search page still hauntingly reads ‘India’s best online shopping site’.

The story of this app is nowhere near the defining plotline of the Indian startup scene. But it certainly is one of the realities facing the fledgling industry. Nearly 4,000 employees lost their jobs when AskmeBazaar shuttered its doors. Several of them say they didn’t receive salaries for months.

The main reason for the company’s downfall has been its inability to turn profits despite huge investments. But was it the only reason for their demise? Or there are some other reasons which we don’t even know?

During its peak success the company in 7 months period, had grown from 10000 to 10 lakh by the help of digital marketing strategy.The website had a wide range of products with 37 main categories including

electronics,fashion,restaurants, travel, matrimony, jobs, education, gadgets, and others and 220 subcategories. Thus making Askme Top 5 marketplace alongside Flipkart, Snapdeal and Amazon India. This initial success of Askme can be attributed to their Marketing Strategies.

Renowned celebrities like Kangana Ranaut, Ranbir Kapoor and Farhan Akhtar were the brand ambassadors of Askme and its subsidiaries. Along with traditional Celebrity Marketing, Askme was also using social media marketing on large scale with the help of social influencers. Askme was also writing around 500 blogs per month, with more than 2 lakh views.

Askmebazaar, Askmegrocery, Askmepay, Mebelkart(also known as Askmefurniture) were some of its subsidiaries. Askme had a planned strategy to conquer every online segment under its name. So Askme started acquisition of small startups to create a big online market for the local customer. Askmebazaar had a $800 Million in annualised GMV (Gross Merchandise Value) in January 2016.

But things do fall at the end and so did happend with Askme too and hence it was finally shutdown on August 19.

Reasons For Its Fall

Lack of Focus: At the heart of the problem was company's lack of focus. AskMe tried its hand in almost every online segment - ecommerce, grocery, furniture, classifieds and payments - losing out to the more focused players in each of these categories. In these segments, it was neither a leader nor a challenger.

Needless Acquisitions: According to experts, AskMe possibly tripped as its owners went about buying startups, minions in their segments, to build a mega start-up. First, they bought BestAtLowest, an online grocery business, and launched AskmeGrocery in May 2015. It was followed by the acquisition of online furniture website MebelKart. Back in 2014, investors were falling over each other to fund e-commerce start-ups, and so acquisitions were easy to fund. But, this is not the case in 2016.

Weak Technology: Managing such diverse businesses requires a great deal of management bandwidth and expertise, both in technology and logistics. Multiple sellers, customers and former employees whom Business Today contacted for the story Walking the Tightrope said technology was the weakest link in AskMe.

Inconsistent Strategy: Harminder Sahni, Founder, Wazir Advisors told Business Today before the website had shut down that AskMe was like JustDial, and then it decided to be like Flipkart, and then like BigBasket. "They have lost the plot. Their strategy is changing every three months. In an ideal situation, you change the strategy when you are exhausted. If they are adding new verticals, it shows that the previous strategy has not worked," he said.

Cash Crunch: AskMe's parent company, Getit Infoservices' revenues more than doubled from Rs 23.4 crore in 2011/12 to Rs 51.2 crore in 2014/15, as per the Ministry of Corporate Affairs data. Net losses ballooned from Rs 54.3 crore to Rs 300 crore during the period. With such a high cash burn rate, it needed a fresh round of funding to keep going but Astro decided to pull the plug on funding. In May, Manav Sethi, Group CMO, AskMe India told Business Today that the company is on the verge of closing a big round with a new set of investors. But that never happened.

Single Investor: According to experts dependence on a single investor has hit the company's ability to raise funds. This is because a big investor keeps tight control over the company and does not give new investors much say in decisions. Getit Infoservices Private Ltd is around 95 per cent owned by Malaysian billionaire T. Ananda Krishnan's Astro Holdings.

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