Move over matchmakers and astrologers. The Rs 400-crore online marriage search industry is growing at a 30% clip and threatens to upend more than just one type of traditional business in coming years.
In October this year, Yahoo, the online search and email website that rivals Google sold its 12 per cent stake in popular Indian online matchmaking site Bharat Matrimony(BM) for Rs 100 crores having bought it for less than half of that in 2006.
The sale did two things: it instantly established the market value of BM to Rs 900 crores; it also underscored the fact that online marriage searches are the wave of the future and companies who are in this business can look forward to tapping into hundreds and millions of Indians who are yet to harness the net in order to look for a spouse but are sure to as Bharat meets India. Investors evidently think so. Yahoo’s stake was snapped up by Bessemer, for Rs 50 crore, while Mayfield bought shares worth Rs 36 crore and Canaan Rs 14 crore. (Click here for graphics)
This is heady stuff for Murugavel Janakiraman, a software consultant who moved back to India from the US in 1997 during the dotcom boom and started BM as a hobby. “My initial vision was small —to build a simple website in my spare time targeted at the Tamil community that would include a forum and relevant news,” he said. He also added a small matrimonial section that encouraged users to put up bride and groom profiles. “With no clear business model in mind or mentor, I tried to spread the word about the site through emails to friends and relatives.”
Fortune is a funny thing. First, Janakiraman found out that the hottest feature of his site was in fact the matchmaking section. Then, he was laid off from the US company he was working for, he decided that he might as well spend all of his time now on his website.
What started in 1997 as a hobby turned out to be the bellwether for an online matchmaking industry that is now pegged at Rs 400 crore. Of this, the lion’s share has been cornered by Janakiraman’s Consim Info—which owns BharatMatrimony.com and a host of other matrimony websites—which according to some estimates controls 80 per cent of all traffic on matrimonial websites.
The other significant players include Shaadi.com and Jeevansathi.com, which have a majority stake in communities of Maharashtra/Gujarat and north India respectively.
At present, the strength at Consim Info comes from the 15-odd regional language websites, 130 offices which the company proposes to expand to 300 by next year. All of this is part of an industry, which is obviously immune to recession, evidenced especially by the fact that it continued to grow at 25 per cent in 2008.
Of course, the biggest driver of this boom is the Indian wedding market—a juggernaut pegged at $40 billion with an estimated growth rate of 20 per cent year-on-year—second only to China, globally. Of this, the matching-making component is estimated to be Rs 5,000 crore, but only 10 per cent of that is organised, according to Anupam Mittal, founder and CEO of Shaadi.com, “While this 10 per cent may appear small, it affords a very large opportunity to anybody who understands this business and is in it for the long-term. I think we can continue to grow above 30 per cent for the next 20 years,” says Mittal.
At present India has 100 million internet users but as that number continues to grow, people like Mittal are betting that they will tap into the over-2,600 wedding portals according to an estimate by a senior official at Jeevansathi.com, another popular marriage site. Of these, about 700 are sites that are the online versions of the samaj which would earlier be the meeting place for all prospective brides and grooms.
Driving business and credibility
Contrary to ads being the lifeblood of most online businesses, an average matrimonial website gets 95 per cent of its revenues come from subscription, and 5 per cent from advertisements. At any given point, a website has between 7.5 lakh to 10 lakh active users who are defined as those who have visited and viewed profiled at least once in a week. An average premium subscription plan for Shaadi.com costs $250 per year.
Subscription models also differ based on services-an unlimited option allowing a user to view up to 250 profiles everyday costs Rs 7,495 yearly. Add-on services like response booster and astro compatibility profiles will cost additional Rs 1,800 and Rs 1,500 respectively for a yearly subscription as well.
The industry started to gain traction when in 1998, private internet service providers (ISPs) were allowed to determine tariffs for services in accordance with guidelines laid down by the Telecom Regulatory Authority of India (Trai). This meant that websites could start to charge for services based on personal and private ISPs-in more simple terms a user profile.
Then, there’s the issue of credibility. “As technology evolves, more and more people will begin to migrate to the online version for matchmaking. This only makes sense because of the fact that the online version provides the credibility that the newspaper version lacks,” said Rohit Manghnani, business head, Jeevansathi.com.
The credibility that Manghnani refers to comes from the fact that most websites now have spam trackers that work to remove fake profiles. The likes of BharatMatri-mony have tied up with professional networking website LinkedIn. Yet others have engaged the services of AC Nielsen to verify data put up by users. From mobile apps to 24/7 call centres for consumer help, these websites have also adopted all modern means of getting in touch and keeping in touch with their consumers.
“The roughness has made online matchmaking increasingly popular in India; it became a tool to search for prospective partners. It provides the comfort and choice of millions of prospects and much more information about a prospect,” says Janakiraman of BharatMatrimony.
Searching for a mate no longer means writing about attributes one is looking for- details about oneself suffice, and like-minded candidates are coughed up during the search. Add to the credibility is the fact that a portal allows interaction along user interface that newspaper classifieds can never do. And the service is for free.
A user can, for example register on BharatMatri-mony.com, Shaadi.com or Jeevansaathi.com free of cost and browse user profiles. Subscription schemes are for users looking to enhance profile views, and for those looking to use premium services like personal meetings among other things. “Profile creation is a free exercise. If a user wants to elevate him/herself to avail of premium services they need to pay. There are a variety of subscription models in place for such users,” Manghnani of Jeevansathi said.
According to a paper published in 2010 by Jiban K Pal, professor at the Indian Statistical Institute, the advantage for these sites comes from their integrity and scalability. “The scalability and integrity of these portals substantially make the difference in their efficiency and use. Most of the developers look for a homogeneous solution in order to address the complex information requirement of heterogeneous people in different degrees. Free registration attract information seekers,” the paper said.
This was the very challenge that Janakiraman faced in the initial years. “It was a challenge in the early days to make people believe in the concept of online matrimony. Being a first-mover, we had to make the idea itself attractive and credible in India,” says Janakiraman of BharatMatrimony. “Even among those who signed up, many were reluctant to post their photographs online. Payment collections posed another set of problems. There were doubts in the minds of many people about making online payments. We were a very small team trying to overcome these roadblocks while at the same time working to provide a useful service,” he adds.
An old industry under fire
Much has changed since those days, and none more so the matchmaking advertisement industry, growing at 15 per cent—of which, online matrimonial websites are growing at 25 per cent. This means that the online business is eating into the market share of the newspaper matrimonial classified industry.