The socio-economic impact of the Covid-19 pandemic has played havoc with everyone’s life in some way or the other. It has altered the way we live our lives. Like many other things, one element that has changed is our mode of transport. "A car is no longer seen as just an aspiration, but new dimensions are added to it – like it being a safe, hygienic mode to commute that one hopes to provide to one’s family and loved ones. For many this would have been just like any other unfulfilled dream, had there been no used-car market segment. Many people can cater to this change of need in their lives now, thanks to the used-car segment,” explains Sandeep Aggarwal, chairman & CEO at Droom Technology. This is the second unicorn Aggarwal has formed after ShopClues, which became a unicorn with an investment of $70 million. Lighthouse Venture has been the biggest investor in the company and nearly one-third of the company’s holdings are with Aggarwal and his employees “In India, the used car market is largely catered to by the unorganised segment who run their set-up usually near a garage shop. Despite the known fear of limited transparency in used car transactions, there are a few who buy cars from these ‘mom-and-pop’ sellers. These buyers often encounter an element of nervousness and anxiety till the deal is closed; their mind continues to remain strewn with apprehension about the future performance of the car,” says Rajinder Singh, a garage owner. Changing scenarios This sorry state of used car buyers is expected to become history over the next few years, thanks to the artificial intelligence (AI)-based interface developed by a Gurugram headquartered technology company – Droom Technology. The company provides an ecommerce platform to buy a used vehicle, dispelling all the fears of a used car buyer by using ‘data’ power. It collects an enormous amount of data pertaining to the used vehicles it sells, using the same to confirm they are from verified users before being posted on the ecommerce platform. Furthermore, it runs more than 1,100 points of inspection on the used vehicle, after a buyer pays the initial booking amount, to get the 360-degree health check of the vehicle finalised. Additionally, the company also offers a six-month warranty after the vehicle is purchased from its platform, providing further comfort and peace of mind to the buyer of the used vehicle and an impetus to go ahead with the purchase. This entire exercise makes the process of buying a used vehicle more transparent and saves a buyer the hassle attached to buying a used vehicle from the unorganised segment. The business model of Droom Technology is similar to Amazon’s, where the products are sold by a reseller but are fulfilled by Amazon. Similarly, in the case of Droom, the company maintains strict checks and balances regarding product quality, but inventory is not held by it and vehicles are sold from its cloud retailer. However, the final sale is done by Droom (in other words orders are fulfilled by the company like on amazon.com). Aggarwal, says: “Just ten years ago, people were cagey even about buying clothes and shoes online, with a view that without ‘touch and feel’ these products cannot be bought. Companies since then have spent a lot on the market by adopting a blue ocean marketing strategy, and in the last decade we have witnessed this concept of ‘touch and feel’ gradually diminishing; no wonder the online sales of clothing and shoes are now more than 10 per cent of total industry sales. Used car sales driven by data and assurance from sellers too are likely to bring an inflection point in used car penetration and in the next 5-7 years, online used cars could reach north of 10 per cent.”
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Aggarwal: adding new dimensions
