Or, death to the SPH and its Classfied Ads.
Carousell is essentially a mobile-first classified ad, following the traditional and proven classified business model. Being primarily (if not only) a consumer-to-consumer marketplace app available for iOS, Android and Web.
Carousell is a simple, intuitive and fuss-free way to declutter homes and lives and, in the process, make buying and selling from a mobile phone an irreplaceable part of everyday life.
One of the co-founders He calls it “classifieds 3.0,” the newest evolution of what started in newspapers and later spread to simple listings sites like Craigslist and OLX. More than merely online shopping, it is a social experience where people meet to sell or swap items, and even form interest groups within the app.
The company follows the simple yet proven classified listings model. The seller lists his/her product on Carousell, then waits for people to signal their interest to bargain with a possibility to purchase. The tricky part, at least in Singapore, is most people have been accustomed to bargaining or low-balling among deal hunters.
What started out for people's second-hands items quickly saw the addition of, new listings such as cars, jobs, property and even services. Again, Carousell is a mobile-first classified ad platform and there is nothing new to having more verticals.
The company monetizes through premium listings, and service fee. They are also going through the virtual currency route with Carousell Coins. Initially, Carousell has always been known for being totally 'free' whereby users can list and purchase through the platform for free. All transactions are so far done offline, i.e. cash on delivery. Carousell has made mobile payment an option by partnership with local banks, mostly as a marketing revenue.
Having said so, the company is able to monetize through marketing campaigns. While numbers such as a daily active users are unknown (it is sufficiently large) for marketing campaigns to the user base. Unlike Shopee, Carousell does not seem keen on bringing in merchants / brands as sellers, as this might dilute the community feeling of the company's brand. So marketing campaigns are mainly one-time off in the form of theme-based, or event-based campaigns among others, but does not necessarily prevent any longer-term campaign engagement.
Furthermore, Carousell Pro is a subscription based service for sellers to enhance the visibility of their listings. This is a dedicated product for sellers, and is probably an upgrade from the premium listings experimented by Carousell in the past months.
The company has made several acquisitions between 2016 and 2017. Most of them have been perceived as 'acqui-hire', and it included Caarly, which was a mobile-first used car marketplace and dealership. The latter led to the beginning of Carousell Motors and having more automotive listings on Carousell. Duriana, a direct competitor in Malaysia, had to eventually sell the business to Carousell.
Carousell might be doubling down on strategic partnerships further down the road with the hiring of corporate development director, implying M&A and JVs as possibilities.
A seller-focused product fits the bill for Carousell in their journey to serve a billion customers. Unlike OLX (and its various brands), Craiglist or Gumtree and others, Carousell has continuously been focused on the customer-experience that a marketplace could deliver. In the equation, sellers play an important part especially those who 'sell' for a living - may it be car dealers, property agents, and others.
Carousell Pro comes in with a monetization angle, while aiming to deliver a superior 'experience' to its sellers. For instance, the enhanced chat and pro insights would be two highlights thus far. The ability to publish more photos is also one of them.
Fallacy of Classfied Ads
Most classified ads platform have missed out a few factors.
- Liquidity (Least important here, otherwise these platforms wouldn't exist)
- Monetization (Tricky although many have survived...)
Briefly on the last two points:
A quick look at OLX and Gumtree, one would be quick to tell that these platforms appear to have a low maintenance cost at both infrastructural and human level. With traffic volume, they essentially should be profitable making money from listing under certain categories, promoting listings, advertisement and others.
So, what other platforms do lack of would be a focused on one side of the marketplace, or both and in this case, we are referring to buyer-experience, and seller-experience.
This is where Carousell Pro comes in, as mentioned previously.
Could Carousell Be Building Its Own Payment Ecosystem Too?
Hard to tell at this point and to imagine a platform like Carousell to be more than just a classifieds platform. It could, nonetheless, synergize with Grab to provide access to its users to,
- Use GrabPay to conduct financial transactions (seller <> buyer)
- Use GrabPay to enable sellers to buy Carousell Coins for Carousell Pro
- To offer rewards on Grab app (to selected users) by Carousell Pro Sellers.
Carousell could however explore blockchain, e.g. Carousell Coins, to enable transaction verification and authentification. The Carousell Coins would be built to facilitate transactions and possibly create an economy of its own for Carousell users. The marketplace, not just Classifieds Ads, is essentially going to be driven by
- Supply & Demand
While we are all highly accustomed to Supply & Demand: Sellers selling a second hand item, and buyers haggling for a lower price for the same said item. There is the cross-border element that we might ignore, given that Supply & Demand on Carousell is rather localised. With cross-border into the picture, the platform would need a unified currency to enable transactions, hence, Carousell Coins built on the blockchain technology. This could equally apply for the local economy, i.e. in Singapore.
Ending Notes on Carousell Goal & Set-Back
The company leverages on machine learning to surface products that might appeal to its users, and to help sellers sell faster. From a user perspective, faster liquidity is always welcome.
What is truly lacking is the ability to make transactions much more easier, and to make the exchange of goods fast and fuss free.
As discussed in previous section, blockhain and coin economy would help for transactions. As for a faster and fuss free transfer of goods from one hand to another, there are last-mile logistics players who are here to solve the dilemma with one problem. Who will bear the cost?
Carousell has truly built a growth platform and with its multiple expansions throughout APAC, it has shown that it could grow bigger, and make classifieds ads great again. We will be curious to see how it develops into a mature company.