market research report : online and offline classifieds market in india 2012

Online and Offline Classifieds ‐ India

May 2012

2ONLINE AND OFFLINE CLASSIFIEDS MARKET IN INDIA 2012.PPT

Executive Summary

Market

Drivers & Challenges

Trends

Competition

•Classifieds market in India was valued at INR xx bn in 2011 and comprises of two segments: Online Classifieds which accounts for INR yy bn Offline/Print Classifieds accounts for INR zz bn

Overall classifieds market in India will be driven by the growth in services sector, favorable demographics and growth in advertising industry

•Emergence of mobile classifieds•Value added services•New ventures in online space•Emergence of local classifieds

Drivers:– Increasing internet penetration– Cost effective advertisements– Growth in online advertising– Favorable demographics– Growth in the services sector– Growth in print media– Vernacular presence– Growing circulation and customer base

Challenges:– Language barrier

– Online payment mechanisms

– Low scope for advertisements

– Low visibility and coverage

Online Players Offline Players

Consim Info Infoedge Monster D B Corp Bennett, Coleman & Co Jagran Prakashan

Quikr OLX Sulekha HT Media Deccan Chronicle Lokmat Media

3

•Market Introduction•Market OverviewClassifieds Market – IndiaOnline Classifieds Offline Classifieds

•Business Model•Revenue Model•Drivers & Challenges•Trends•Major PlayersTraffic Statistics

•PE Investments•Recent Developments•Strategic Recommendations•Appendix

ONLINE AND OFFLINE CLASSIFIEDS MARKET IN INDIA 2012.PPT

4

SAMPLE Classifieds are increasingly becoming a popular mode of advertisements for both online and offline space

Classifieds Market – Introduction

Classifieds

Offline Classifieds

• Newspapers comprise the major part of this segment

• Ads are typically short and are charged/word

• Mainly text with no graphics

Classifieds – Segmentation

Classifieds

General

Real Estate

Recruitment

Automobiles

Classifieds – Types

MatrimonialOthersOnline Classifieds

• Comprises of extensive ad space and structure

• Longer messages and use of graphical text

• Wider scope for searches

• Advertisements are grouped under headings classifying the products or services being offered• Cheaper than larger display ads and mostly placed by private individuals with single items to buy or sell•Usually comprise text with no graphics and short statements about the requirements of buyer or seller

Classifieds is a distinct type of advertising medium with both online and offline modes


5

SAMPLE

• Classifieds market comprises of two segments: Online Classifieds

Offline/Print Classifieds

• Classifieds market is witnessing a change in the share of market segmentationWith growing internet usage, print classifieds market faces stiff competition as the online segment posts rapid growth

•Online classifieds segment is growing rapidly and is attracting many small and big players Players are venturing into new market segments to offer differentiated services

•Offline classifieds continue to operate with their traditional models and target niche audiences

•Overall, the classifieds market in India will be driven by the growth in services sector, favorable demographics and growth in advertising industry

Online classifieds is expected to grow faster than the offline segment

Classifieds Market – Size and GrowthClassifieds Market – Overview

Note:• Online classifieds market includes recruitment, matrimonial, automobile and real estate classifieds

• Offline classifieds market includes newspaper classifieds

Classifieds Market – Segmentation

INR bn

a

b

c

d

e

0

Xyz%

2016e2015e2014e2013e2012e2011

62.7%

43.8%

B1A1

2011 2016e


53.2% 46.9%

6

SAMPLE Online classifieds operate on a business model that integrates both advertisers and consumers

Online Classifieds – Business Model

Registration/ Membership

The modus operandi of the online classifieds business initiates with a registration with the respective portal and paying the required membership fees upfront to become a registered subscriber

aaa

aaa

aaa

aaa

xxx

xxx

xxx

xxx

Classifieds act as a medium between the advertisers and final consumers

Classifieds act as a medium between the advertisers and final consumers

Advertiser Consumer


7

SAMPLE Offline classifieds have a revenue structure which is determined by the advertisement costs

Offline Classifieds – Revenue Model

xxx

Ad Style

Edition

xxx

xxx

xxx

Offline classifieds or newspaper classifieds, have a revenue structure that is primarily determined by various factors associated directly with the costs of the classified advertisements

Newspaper classifieds account for 10‐15% of a newspaper’s total ad

revenues

Agencies also provide assistance for classifieds advertising in lieu of

some charges

At roughly 25% margins, they are more profitable

than display advertisements

Ad Size

Area Coverage


8

Online Market Drivers

Offline Market Drivers

Common Drivers

• Increasing internet penetration

•Cost effective advertisements

•Growth in online advertising

•Growth in print media

•Vernacular presence

•Growing circulation and customer base

• Favorable demographics

•Growth in the services sector

Drivers – Summary


SAMPLE

9

SAMPLE

Language barrier

Low presence of vernacular languages in online medium poses a barrier for online classifieds market

•Non‐availability of vernacular languages in online classified space poses a barrier as the target consumers get restricted to the literate population only

• However, online advertisements in regional languages such as Hindi, Tamil, Telugu and Malayalam outperform English ones Indians respond better to regional language ads as compared to English ads, by almost 30%

•Non familiarity with English alienates many people from using online media for classifieds services and choose newspapers instead

• Absence of online classifieds in regional languages acts as a major challenge for the online classifieds market in India

Impact

Online Offline

Preference of Language of Internet Users Urban Literacy Levels in India

English

28%

72%Vernaculars 58%

42%

Non English LiterateEnglish Literate

Total Urban Population

of India– 266 mn

Urban Literate

Population‐217 mn

Internet Users in India – 49 mn


10

Major Public Companies ‐ Summary

Note: All figures are in INR mn and are based on the latest financials available

36,111.7

27,120.0

7,328.5

‐1,000

‐500

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

‐5,000 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 60,000 65,000

Total income

Net Profit/Loss

57,820.7

40,124.0

26,322.4

Size of the Bubble represents Market Capitalization in INR mn

ba fedc

SAMPLE

11

SAMPLE

Public: Domestic Company – Company Abc. (x/x)

Key People

Products and Services

Company Information Offices and Centres – India

Corporate Address

Tel No.

Fax No.

Website

Year of Incorporation

Ticker Symbol

Stock Exchange

Category Products/Services

Name Designation

Note: The list of products and services is not exhaustive

Bhopal

Head Office

12

SAMPLE Public: Domestic Company – Company Abc. (x/x)

Financial Snapshot Key Ratios

Financial Summary

• The company incurred a net profit of INR xxx mn in FY 2012, as compared to net profit of INR xxx mn in FY 2011

• The company reported total income of INR yyy mn in FY 2012, as compared to INR yyy mn in FY 2011

• The company earned an operating margin of 20.64 per cent in FY 2012, a decrease of 7.19 percentage points over FY 2011

• The company reported debt to equity ratio of 0.61 in FY 2012, anincrease of 4.11 per cent over FY 2011

Key Financial Performance Indicators

Indicators Value (dd/mm/2012)Market Capitalization (INR mn) 36,111.70Total Enterprise Value (INR mn) 36373.2EPS (INR) 11.01PE Ratio (Absolute) 17.62

Particulars y‐o‐y change (2012‐11)

2012 2011 2010 2009

Profitability RatiosOperating Margin ‐7.19 20.64% 27.83% 27.84% 12.32%

Net Margin ‐6.53 13.71% 20.24% 16.13% 3.65%

Profit Before Tax Margin ‐7.70 20.36% 28.06% 25.88% 7.96%

Return on Equity ‐10.14 21.06% 31.20% 26.77% 13.27%

Return on Capital Employed ‐5.59 26.68% 32.27% 30.88% 15.31%

Return on Working Capital 21.88 98.17% 76.28% 58.89% 36.50%

Return on Assets ‐6.00 13.10% 19.10% 14.08% 3.28%

Return on Fixed Assets ‐11.34 25.50% 36.84% 28.72% 5.95%

Cost RatiosOperating costs (% of Sales) 7.43 79.20% 71.77% 71.47% 87.37%

Administration costs (% of Sales)

‐12.91 0.00% 12.91% 12.32% 12.05%

Interest costs (% of Sales) 0.00 1.06% 1.06% 3.24% 4.22%

Liquidity RatiosCurrent Ratio ‐35.51% 1.51 2.34 2.12 1.33

Cash Ratio ‐22.47% 0.58 0.75 0.81 0.23

Leverage RatiosDebt to Equity Ratio ‐4.11% 0.61 0.63 0.90 3.04

Debt to Capital Ratio ‐18.40% 0.18 0.22 0.33 0.68

Interest Coverage Ratio ‐26.58% 19.59 26.68 8.81 2.99

Efficiency RatiosFixed Asset Turnover 2.87% 1.85 1.79 1.74 1.59

Asset Turnover 1.92% 0.95 0.93 0.85 0.88

Current Asset Turnover 12.84% 2.40 2.13 1.88 2.40

Working Capital Turnover 91.25% 7.10 3.71 3.56 9.76

Capital Employed Turnover 0.30% 1.52 1.52 1.62 3.55

Improved Decline

Total Income Net Profit/LossINR mn INR mn

a

b

c

0

a

b

c

20090

2010 20122011

13

SAMPLE Public: Domestic Company – Company Abc. (x/x)

Key Business Segments Key Geographic Segments

Key Recent Developments

Description News

Overview • xxx

Readership • xxx

Businesses • xxx

0%0%0%0%1%0%0%0%1%1%

‐50%

0%

50%

100%

150%

2012

4%

95%

2011

1% 4%

95%

2010

3%

95%

2009

1% 3%

96%

Event

Radio

Printing Corporate

Others

0%

50%

100%

2012

14,638

Note: Business Segments and Geographic Segments are based on total revenues

India

The company has operated in India for the last four years

14

SAMPLE

10,167,906

‐500

‐400

‐300

‐200

‐100

0

100

200

300

400

500

600

700

800

900

‐400 ‐200 0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600 2,800

Net Profit/Loss

Total Income

1,024ConsimOLX

1,329Times Business Solution

Major Private Companies ‐ Summary

Note: All figures are in INR mn and are based on the latest financials available

ca b

Size of the Bubble represents Total Assets in INR mn

15

SAMPLE

Private: Domestic Company – Company Abc (x/x)

Key People

Products and Services

Company Information Offices and Centres – India

Corporate Address

Tel No.

Fax No.

Website

Year of Incorporation

Category Products/Services

Name Designation

Note: The list of products and services is not exhaustive

Chennai

Head Office

16

SAMPLE Private: Domestic Company – Company Abc (x/x)

Financial Snapshot Key Ratios

Financial Summary

• The company incurred a net profit of INR aa mn in FY 2011, as compared to net profit of INR aa mn in FY 2010

• The company reported total income of INR bb mn in FY 2011, as compared to INR bb mn in FY 2010

• The company earned an operating margin of 2.97 per cent in FY 2011 a decrease of 3.23 percentage points over FY 2010

• The company reported debt to equity ratio of 0.02 in FY 2011, an increase of 35.66 per cent over FY 2010

Particulars y‐o‐y change (2011‐10)

2011 2010 2009 2008

Profitability RatiosOperating Margin ‐3.23 2.97% 6.20% 8.20% ‐34.70%

Net Margin 1.17 0.87% ‐0.30% ‐37.22% ‐68.89%

Profit Before Tax Margin ‐3.23 2.97% 6.20% 8.20% ‐34.70%

Return on Equity 1.22 0.97% ‐0.25% ‐32.03% ‐54.19%

Return on Capital Employed ‐2.50 4.85% 7.35% 10.10% ‐41.19%

Return on Working Capital ‐175.86 ‐173.72% 2.14% 220.11% 347.55%

Return on Assets 1.19 0.95% ‐0.24% ‐30.32% ‐54.13%

Return on Fixed Assets 15.53 11.02% ‐4.51% ‐647.96% ‐1164.61%

Cost RatiosOperating costs (% of Sales) 3.23 97.03% 93.80% 91.80% 134.70%

Administration costs (% of Sales)

3.23 97.03% 93.80% 91.80% 134.70%

Interest costs (% of Sales) N.A. 0.00% 0.00% 0.00% 0.00%

Liquidity RatiosCurrent Ratio 58.96% 0.98 0.62 0.59 0.54

Cash Ratio 135.24% 0.63 0.27 0.35 1.21

Leverage RatiosDebt to Equity Ratio ‐35.66% 0.02 0.04 0.06 0.00

Debt to Capital Ratio ‐34.83% 0.02 0.04 0.05 0.00

Interest Coverage Ratio N.A. N.A. N.A. N.A. N.A.

Efficiency RatiosFixed Asset Turnover ‐17.38% 12.64 15.29 17.41 16.91

Asset Turnover 30.88% 1.09 0.83 0.81 0.79

Current Asset Turnover ‐26.30% 3.29 4.47 4.05 4.31

Working Capital Turnover 2646.60% ‐199.20 ‐7.25 ‐5.91 ‐5.05

Capital Employed Turnover 29.20% 1.11 0.86 0.86 0.79

Improved Decline

Net Profit/LossTotal IncomeINR mn

a

0

b

c

d

INR mn

a

b

c

0

2011201020092008

17

SAMPLE Private: Domestic Company – Company Abc (x/x)

Key Recent Developments

Description News

Overview • xxx

Product Portfolio • xxx

Partnerships • xxx

18

SAMPLE


Traffic Statistics – xyz

Ranks Most Viewed Sub‐Domains

Audience Snapshot Technical Details

Global RankGlobal Rank

India RankIndia Rank

ReachReach

93959

11243

0.00124

100.0%

a

Age (Years)Age (Years)

GenderGender

Time (mm:ss)Time (mm:ss)

25‐34

Male

07:15

Unique Page Views/Day(%)

Unique Page Views/Day(%)

Search Engine Redirection (%)

Search Engine Redirection (%)

6.5

4.8

Average Load Time (Secs)

Average Load Time (Secs) 1.182

19

SAMPLE Recent Developments (x/x)


Oct 2011Oct 2011

Oct 2011Oct 2011

Oct 2011Oct 2011

Oct 2011Oct 2011

Jun 2011Jun 2011

•Bossclassifieds.com introduces its free of cost online advertising and classifieds website in India

•Users can avail the website’s services to promote and market their products and services at absolutely no charge

• Yahoo sold off its stake in Consim Info to Bessemer India Capital Holdings II Ltd., Canaan VII Mauritius and Mayfield XII Mauritius

• The deal was conducted via a stock purchase agreement dated Sep 2011

•AdLift.com, a leading search engine marketing firm joined hands with Getit Infoservices to provide a boost to Getit’s market share within SEO and PPC segments

• Sulekha.com introduced its real estate focused online portal Sulekha.comProperty, which will facilitate online buying, selling, rental and provide information on localities and brokers

• ZenithOptimedia won the media duties for OLX for an investment of INR 100‐120 mn •OLX relied on ZenithOptimedia’s strategy based on consumers as well as products understanding

20ONLINE AND OFFLINE CLASSIFIEDS MARKET IN INDIA 2012.PPT

• xyz

Driving xyz amongst end consumers

• xyz

Boost xyz

• xyz

Gear up for xyz

Strategic Recommendation

Strategic Recommendations SAMPLE

21VENTILATOR MARKET IN INDIA 2012.PPT

Thank you for the attentionThe Online and Offline Classifieds Market – India 2012 report is a part of Netscribes Business Service’s Industry Series.For more detailed information or customized research requirements please contact:

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