“We are looking into what more we can offer to our customers,” says Pickaboo CEO Morin Talukder. Pickaboo has been mounting to build a sustainable differentiation to break out in the market. Over the last three years, the company has made drastic changes to its business model and strategic direction. It has positioned itself as an omnichannel mobile and gadget platform and introduced several customer-first initiatives. “For instance, we have launched a 3-hour delivery,” says Morin. “Our goal is to blur the line between offline and online. You can get your products instantaneously. Convenience, good offer, quality products, and at the same time, no or low waiting time.”
Pickaboo has practically been blurring the line between online and offline with its omnichannel strategy. It is probably the largest omnichannel mobile and gadget platform in Bangladesh. On the back of an innovative franchisee model, Pickaboo has built an offline retail operation across multiple cities. The offline retail has afforded Pickaboo a new sales channel, extended brand awareness in both ways, expanded its online customer base, and built a network of small businesses.
These changes are taking effect, allowing Pickaboo greater leverage for expansion.
Focusing on a single category means greater execution power, efficiency, and speed. You can say that focusing on a single category can limit your potential market size. It can be true for many verticals where TAM is relatively small. But not so for Pickaboo because of the vertical it deals in. Mobile alone is a huge market in Bangladesh. It is not only a big market, it is a market where there is still ample room for growth. It is far from a mature market. Smartphone penetration remains at 40% and is expected to reach 70% in the next few years. The market is not only growing at a 10% rate annually, the smartphone growth will continue in the next few years as feature phone users convert to smartphones. Current market data suggest that every month Bangladesh sells close to 7 lakh smartphones. So the TAM and the room for growth are there.
Pickaboo says it is one of the leading platforms to sell mobile and gadgets in the existing smartphone market. The company sees a realistic path to become a unicorn, the coveted $1 billion-dollar company. While recent initiatives have helped accelerate Pickaboo’s organic growth, the next round of growth will take significantly greater efforts.
Pickaboo has practically been blurring the line between online and offline with its omnichannel strategy. It is probably the largest omnichannel mobile and gadget platform in Bangladesh. On the back of an innovative franchisee model, Pickaboo has built an offline retail operation across multiple cities. The offline retail has afforded Pickaboo a new sales channel, extended brand awareness in both ways, expanded its online customer base, and built a network of small businesses.
Mobile and gadgets are a competitive market. Pickaboo faces steep competition from big online and offline players such as Daraz and Gadget and Gear but also from a large number of smaller players who combinedly sell a staggering number of products online and offline.
Pickaboo, however, has certain advantages.
Pickaboo is the only omnichannel player in the vertical operating at scale. Omnichannel has many challenges but the advantages outweigh most of them. Offline retail continues to be the largest player in any commerce vertical. For any commerce, it will take years to surpass the reach and scale of offline retail. Having an offline retail presence allows Pickaboo to take advantage of that reach and scale.
Second, while ecommerce has experienced phenomenal growth in the last two years—thanks to the pandemic—but many people still prefer offline shopping for expensive products. Trust remains a difficult terrain for ecommerce to win.
Offline retail not only allows Pickaboo to reach these trust-deficient customers but also helps them to convert many of these customers online. Because once these customers learn that Pickaboo also exists on the internet they should be willing to try that as well.
More importantly, an intersection between offline and online can help Pickaboo formulate a superior data strategy that can benefit both ends of its operations. The other benefits such as using offline shops as a potential distribution hub or pick locations are also there. We have written extensively on Pickaboo’s omnichannel strategy here and retail strategy here.
The second important advantage Pickaboo has is a deep understanding of the mobile vertical. Let me tell you where it comes from. Pickaboo has been operating in the vertical — mobile and gadgets — for over six years now. You can’t find many companies doing that for so long, at least in Bangladesh. In ecommerce, it is even rarer. The company says it has deep knowledge of how the vertical works, its dynamics, and its secrets.
To add to its own experience, Pickaboo has a deep partnership with Edison Group, one of the homegrown dominant players in the mobile market. Edison is a wholly different story. The group owns the Symphony brand. While Symphony has faced increased competition in the past few years, it was once the largest and fastest-growing mobile handset brand in Bangladesh for many years in a row. Symphony used a perfect model of disruptive innovation to take mobile phones to the remotest parts of Bangladesh. The Edison Group connection allows Pickaboo a deep understanding of how the mobile phone market operates, how pricing is done, how the distribution network works, and how growth plays out in the market.
Domain knowledge is invaluable in any business. And Pickaboo has it in abundance.
But Pickaboo says it does not want to rest on the perceived advantages. The company wants to see reality in the eye and build on its advantages. Pickaboo looks to aggregate more products to offer people greater choices, and more reasons to shop on Pickaboo.
Plans and resources have been dedicated to finding strategies to offer consistent price benefits to customers and play around with pricing using its market power. Everyday low price is the ultimate winning strategy in any retail, be it digital or otherwise. Pickaboo recognizes the importance of being able to provide competitive pricing.
Being an aggregator with a presence both online and offline should render it enough market power to influence the pricing terms eventually. Pickaboo has been investing heavily in automation to improve efficiency and reduce cost. If it can save in those areas, the savings can then be offered to customers in the form of price benefits.
Pickaboo has built its positioning on superior customer service. We have written about its customer-first strategy for growth and strategic moats before. The company aims to take it a notch up and is also betting on faster delivery. Mobile and gadgets are often impulsive purchases. Delays are bad for impulses. Pickaboo wants to serve the customers when they want it. As we mentioned earlier, Pickaboo is experimenting with several faster delivery models. Pickaboo is working on a new app. It has launched a new version of its web recently.
Pickaboo has largely grown organically over the past two years. As the pandemic decimated retail business and the business of non-essential goods, the company took a patient approach to growth in the last two years. It focused on serving loyal customers, pushing for organic growth as much as possible, and optimizing operations to offer greater benefits to customers.
These moves have helped keep the growth consistent. In fact, the company says it now has a sustainable business that has literally, to borrow from Paul Graham, the infinite runway. But the company says the timing for accelerated growth has come. Pickaboo has been investing in the growth of late.
Every growth story is a wave and an epoch. Waves are time-bound. They come and if you miss the ride, it is gone. You will have to wait for the next wave. In startup lingo, everyone talks about the importance of timing. For an idea whose time has come, nobody can stop it. Right timing makes pure luck look like a terrific execution. The digital business environment is going through that moment in Bangladesh.
The global coronavirus pandemic has instigated a digital acceleration across markets. Bangladesh is no different. Bangladesh today is a different market for digital businesses than it was three years back. More people now are exposed to digital services. Ecommerce has expanded out of urban hubs into semi-urban pockets. In the next few years, digital inclusion will come full circle with increased smartphone and internet penetration and accessibility to digital services.
Every growth story is a wave and an epoch. Waves are time-bound. They come and if you miss the ride, it is gone. You will have to wait for the next wave. In startup lingo, everyone talks about the importance of timing. For an idea whose time has come, nobody can stop it. Right timing makes pure luck look like a terrific execution. The digital business environment is going through that moment in Bangladesh. The companies that will be able to ride this wave will reap great benefits in the coming years.
After years of deliberation and its share of missteps, Pickaboo says it is ready to ride the wave. The company says it has done the foundational work and is going for all-out growth in the coming months. Its omnichannel model can render it a greater competitive edge. Selling a phone online, while appearing simple, is not any easier. It is at times an expensive business. But Pickaboo sees costs come down eventually once we see more customers start to purchase online.
As we discussed earlier, Pickaboo has several upsides, and played right, they can render great advantages. Competition remains limited. Pickaboo has an excellent understanding of the vertical. It runs an omnichannel operation which affords it excellent deals from the brands. As Pickaboo’s business grows, this market power should grow further along with affording it further opportunities to expand.
