PriceBaba Is an Offline Native in the Online World

Offline price comparison website PriceBaba is an anomaly at a time when e-commerce in India is growing at leaps and bounds. While major e-commerce players have been busy raising billions of dollars, building an ecosystem of around online price comparisons and affiliate income in the process, Mumbai-based PriceBaba has been busy building a database of offline retailers. The objective is to help you find the best deal in your neighbourhood.

The site recently expanded into four new cities, which means people across 11 cities - Mumbai, Thane, Navi Mumbai, Pune, Gurgaon, Delhi, Noida, Bangalore, Ahmedabad, Hyderabad, and Surat - can benefit from the site. PriceBaba aims to expand to Chennai and Kolkata soon, but has already stepped into an even bigger market - the Internet. Aside from offline store prices, the site will now also now offer prices from sites like Flipkart, Amazon, and Infibeam.

An inevitable step perhaps, but getting there has been a steady journey, and it started with co-founder Annkur P Agarwal getting tired of people asking him what phone they should buy.

If you're the "techie" in your group of friends or family, you're probably familiar with the ritual that everyone follows when they're about to buy a new gadget. First, they'll do some research on their own and get confused about what to buy. Then they'll come to you for advice, and once you've given a thoughtful, reasonable answer, they'll ask you a dozen obscure questions you'll likely struggle to answer. And after all this is done, they'll go ahead buy whatever they wanted in the first place, completely disregarding your advice.

Most of us start throw up our hands in despair after this cycle has been replayed a few times, and start pointing people to useful lists they can check themselves.

Agarwal took a slightly different approach. He built a website to help people figure out what phone they wanted, and then find the best deals from shops where it could be bought.

"I started off in 2002, as an online retailer on different marketplaces but I wanted to launch my own site as well," says Agarwal. "It ended up being a mix of writing about gadgets and e-commerce, sort of inspired by Engadget."

"We were becoming a media company though, and that is very hard to scale, so I started thinking about product," he explains. "At the time people were always coming to me for price advice - they'd found what looked like a good deal, but they wanted to be sure about it. So it seemed like a good problem to solve."

This was in 2012, and Agarwal believed that while people were researching phones online, much of the buying still took place offline. While comparing prices across online sellers has always been easy, what with various price comparison sites - or by simply opening multiple tabs - checking the price difference between a seller in - say - South Extension and Lajpat Nagar wasn't easy. PriceBaba put people on the ground to make contact with the retailers, and started building up a database.

Agarwal tells us that the company has now tied up with over 1,500 retailers across the country, and although PriceBaba has now added websites to its arsenal, he believe online isn't ready to replace offline just yet.

"E-commerce has done a great job in winning mindshare, and it has also done well in gaining some part of the marketshare," says Agarwal, "but this in not China or the United States yet. What we see happening right now is that phones sell where they are cheaper. If a phone is cheaper offline, it sells offline. If it is cheaper online, then it sells online."

A new trend in the market might change things though, and that is the exclusive tie-ups mobile brands are making with online sellers.

"Exclusivity is a new angle now," says Agarwal. "And that's why we also started offering online comparisons. We started with Motorola and Xiaomi first, because people were asking about the phones, and they're only available online."

(Also see: Are Online Sales and Exclusive Tie-Ups Creating a Monopoly?)

Online exclusives still represent a small number, which is why Agarwal thinks they aren't really hurting offline sellers; instead, he believes, they are helping build buzz around the category, which benefits both online and offline retailers. In the long term though, he worries about the trend to heavily discount phones, "using VC money to fund discounts." This creates what he calls "fake demand."

"The people are buying simply because the phone is on sale with a big discount. We don't really know what the actual market in India is like," he believes.

"The excessive discounting is a little monopolistic, but organised retail is also dropping the ball. Look at the websites of some of the big chains, and you realise that they only see online as a catalogue. That's going to hurt them."

PriceBaba wants to be the bridge for this sector. So, even though it is adding an online component now, the site continues to grow with a feet-on-the-ground approach.

"We're going where the customers are, so we're signing on big chains like Sangeetha mobiles," says Agarwal. "Adding support for online sellers isn't very difficult - the big question there is trust. We're still debating and figuring out the metrics for trust for online sellers while we add more."

"But you're going to see a lot more competition offline as well," he says, "The market is wide open. But we've already got a strong relationship with people around the country, and people will find that building scale offline is a lot more challenging."