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Directi Business Case Study Presentation '09 Team Gryffindor - ISB Hyderabad
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Directi Business Case Study Presentation '09 Team Gryffindor - ISB Hyderabad

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    Directi Business Case Study Presentation '09 Team Gryffindor - ISB Hyderabad Directi Business Case Study Presentation '09 Team Gryffindor - ISB Hyderabad Presentation Transcript

    • 1
      Case Study: DirectI Blogging Service
      By Gryffindors
      Anirudh Kumar
      Parag Dhanuka
      Prayag Panchwadkar
    • Agenda
      Context: Industry Analysis
      • SWOT
      • Competitor Analysis
      Increasing adoption and awareness of blogging in India
      • Segmented Targeting
      • Securing “Marquee Bloggers”
      • New Design Feature Promotion
      Plan for marketing and business development
      • Promotions
      • Additional Product Features
      • Business Development
      Monetization strategies
      • Ad Revenue
      • Affiliate Marketing
      • Free-mium Model
      • Widgets Marketplace
      2
    • SWOT Analysis
      3
    • Competitor Analysis
      4
    • Network effects
      5
    • Agenda
      Context: Industry Analysis
      • SWOT
      • Competitor Analysis
      Increasing adoption and awareness of blogging in India
      • Segmented Targeting
      • Securing “Marquee Bloggers”
      • Promotion through Distinct Product Attributes
      Plan for marketing and business development
      • Promotions
      • Additional Product Features
      • Business Development
      Monetization strategies
      • Ad Revenue
      • Affiliate Marketing
      • Free-mium Model
      • Widgets Marketplace
      6
    • The "Community Effect” can drive blogging in India
      The Social Networking Phenomenon
      • A runaway success in India
      • No. of users on Orkut & Facebook has grown to more than 16 million.
      Community
      Feeling
      Online Gaming Success
      • Great Success of Zapak.com in mobilizing their network
      • Participation rates exceeded expectations
      Education Forums
      • Pagalguy.com saw unparalleled success
      • Many new education portals / services launched . Ex. Meritnation.com
      In India, one needs to tap into the “community effect” to make any online venture a success.
      All of the above examples have become successful by generating positive network effects.
      Source: JuxtConsult; I-Cube 2008; Team Analysis
      7
    • Leveraging the Community Effect – Building Relationships with large offline / online networks
      Objectives
      • Make blogging popular in India among different user groups, which need to be selected strategically
      • Achieve the “community effect” among an initial set of bloggers in each user group, which will encourage others with similar interests to blog
      • Help generate credible and quality content that will attract more readers and more potential bloggers
      Suggested Plan of Action
      • Leverage the user baseof existing “successful” offline / online communities or networks to encourage blogging
      • Target communities whose users would ideally take to blogging, such as people trying to lose weight / keep fit, etc.
      • Attract people to write quality content, by promoting product design features that enable online community building
      8
    • Relationships with large networks - Examples
      Target User
      Group
      Potential
      Possible
      Themes
      Possible
      Tie-up
      VLCC
      • Only 15% of Indian bloggers are women
      • A win-win situation for both the company (branding – VLCC groups) as well as for Directi (VLCC User blogs will attract more potential bloggers and build the community)
      Losing Weight /
      Keeping Fit
      Raising Children
      / Motherhood
      Cooking / Recipes
      Women
      • MBA coaching institutes with large number of users can be used to reach out to people preparing for the CAT / GMAT. Popularity of forums such as Pagalguy shows that there is a lot of potential for new bloggers from this area
      • If buy-in can be obtained from a few large school chains, a large number of students can be incentivized to blog, which will further incentivize other schools’ children to create blogger communities
      School / College
      Blogging
      Entrance
      Examinations
      Schools /
      Colleges
      MBA Coaching Institutes
      Students / Education
      Source: JuxtConsult 2008; Team Analysis
      9
    • Relationships with large networks - Examples
      Target User
      Group
      Possible
      Themes
      Possible
      Tie-up
      Potential
      • Indian online travel market is estimated to be worth over USD$2 billion for 2007-08 and is growing rapidly
      • Firms such as SOTC can give users “blogging coupons” to get started on Directi blogs
      • Huge potential to rope in potential bloggers and large number of readers
      Traveling
      Experiences
      SOTC Tours
      Travelers
      • A large proportion of this base of users would be very ready to blog given their reading habits
      Crosswords Bookstores
      Literature Enthusiasts /
      Avid Readers
      Book Reviews
      • Great potential to secure users from this untapped source of potential bloggers who would want to share their spiritual thoughts / journey
      • Great Cross Branding Opportunity for Art of Living
      Health /
      Spirituality Enthusiasts
      Art of Living
      Spiritual Ideas
      / Practices
      Source: Indiaprwire.com; Web Sources; Team Analysis
      10
    • Leveraging the Community Effect - Securing “Marquee Bloggers”
      11
    • Securing “Marquee Bloggers” – Examples
      Securing “Marquee Users” along with helping create suggested sub-communities of bloggers should make sure that we leverage the “Community Effect” opportunity with great success
      12
    • Promotable Product Attribute 1 : Accessibility
      13
    • Promotable Product Attribute 2: Localization
      14
    • Promotable Product Attribute 3:Social Network
      15
    • Promotable Product Attribute 4: Avenues of Monetization
      16
    • Promotable Product Attribute 5: Power features
      17
    • Directi Marketplace – A model for Open Innovation
      Corporate Marketplace
      • Firms transact with developers to get product / company specific themes / widgets made
      • Sponsored and sponsor free themes and widgets offered free to bloggers
      Application Developers
      Brands /
      Companies
      Sponsored &
      Sponsor Free
      Themes and Widgets
      User Marketplace
      • Users transact with developers to get their blogs (premium or free) designed as per their choice
      • Directi gets a share of the transaction amount
      Bloggers
      The Directi marketplace has two parts – (1) The User Marketplace: A transaction platform for bloggers and developers where bloggers can ask for specific blog designs or blog setup help, and (2) The Corporate Marketplace, where firms employ developers to develop sponsored themes and widgets offered free to bloggers
      Source: Team Analysis
    • Promotable Product Attribute 6: More than just a blog
      19
    • Agenda
      Context: Industry Analysis
      • SWOT
      • Competitor Analysis
      Increasing adoption and awareness of blogging in India
      • Segmented Targeting
      • Securing “Marquee Bloggers”
      • New Design Feature Promotion
      Plan for marketing and business development
      • Promotions
      • Additional Product Features
      • Business Development
      Monetization strategies
      • Ad Revenue
      • Affiliate Marketing
      • Free-mium Model
      • Widgets Marketplace
      20
    • Promotions (Viral Marketing)
      21
    • 22
      Business Development through Affiliations
    • Promotions (Advertisements)
      23
    • Revenues from Ads
      Based on the above calculations any acquisition cost below $6.61 is justified. Hence we should promote our brand with display, SEM and radio advertisement being the priority order
      24
    • Agenda
      Context: Industry Analysis
      • SWOT
      • Competitor Analysis
      Increasing adoption and awareness of blogging in India
      • Segmented Targeting
      • Securing “Marquee Bloggers”
      • New Design Feature Promotion
      Plan for marketing and business development
      • Promotions
      • Additional Product Features
      • Business Development
      Monetization strategies
      • Ad Revenue
      • Affiliate Marketing
      • Free-mium Model
      • Widgets Marketplace
      25
    • How will Directi Earn revenues ?
      26
    • Monetization (Advertisement)
    • Monetization (Freemium Model)
      Based on the above numbers 1000 additional active bloggers should bring us an extra $416 / Year
      28
    • Internal Affiliate System (IAS)– A way to generate quality content and increase blogger base
      Tying up with
      companies
      Getting Bloggers
      on Board
      Bloggers promote
      participants
      Bloggers get
      Paid per click
      • Bloggers need to sign up with the affiliate system to start promoting the companies and earn money
      • There is an incentive to generate better written content as more money can be made than with Skenzo or Adsense
      • Bloggers get paid a higher percentage per click than with traditional Adsense ads
      • Bloggers blog about a particular product / service
      • They leverage their readership to get more user clicks
      • Directi ties up with various companies & creates a network of affiliates who want to advertise more effectively
      • This system allows better ROI on the advertisers’ money
      The Internal Affiliate System (IAS) can be an extremely useful model for Directi as not only does it generate revenue (commissions from advertisers), it also ensures that good content and hence more readership is generated for the platform
      29
    • Optimistic Estimates with a simple freemium model and an integration with AdSense result in an NPV Of $46.35M
      $ Million
      NPV = $46.35 Mn
      CAGR
      74.80%
      CAGR
      120.40%
    • Pessimistic Estimates with basic monetization platform suggest an NPV of $3.99M - Project seems viable even in worst case scenario
      $ Million
      NPV = $3.99 Mn
      CAGR
      49.60%
      CAGR
      104.60%
    • Conclusion
      There exist significant gaps in the feature sets needed for Indian bloggers & what exist in today's platforms which can be plugged with a targeted feature set.
      Community effects need to be leveraged in order to achieve substantial network effects & propagate the acceptance & spread of blogging in India.
      Financial projections suggest that using the monetization tools elaborated, Directi should expect to derive significant value from this project.
      32
    • Thank You
      33