Marketing Project

RedBus.in

Name: Ammar Halai

Sec: SYBBA-1
Roll no: 129
Table of Contents
INTRODUCTION TO INDUSTRY .......................................................................................... 3
Indian E-Commerce Industry................................................................................................. 3
Online Travel Industry ........................................................................................................... 3
Online Bus Ticket Booking in India: .................................................................................... 5
INTRODUCTION TO COMPANY .......................................................................................... 8
RedBus.in ............................................................................................................................... 8
Goals and Objectives ........................................................................................................... 11
Concepts of marketing management:....................................................................................... 12
RedBus.in Segmentation: ..................................................................................................... 15
Market Environment Scanning ................................................................................................ 22
Analyzing Market Environment .......................................................................................... 22
IDENTIFYING AND ANALYZING THE COMPETITORS: ............................................... 25
7 P’S OF MARKETING:......................................................................................................... 26

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 INTRODUCTION TO INDUSTRY

Indian E-Commerce Industry

A type of business model, or segment of a larger business model, that enables a firm or
individual to conduct business over an electronic network, typically the internet. Electronic
commerce operates in all four of the major market segments: business to business, business to
consumer, consumer to consumer and consumer to business.
There are many Services or services which are parts of e-Commerce are:

 Online goods and services- Streaming media, electronic books, software.

 Retail services (E-retailing)-Banking, food ordering, online pharmacy, Travel(RedBus.in
falls in E-retailing part of E-commerce).
 Marketplace services- Trading communities, auctions, advertising.
 Mobile commerce- Payment and ticketing.
 Customer service- Call centre, help desk, live support software.

The e-Commerce market in India has enjoyed phenomenal growth of almost 50% in the last five
years. Although the trend of e-Commerce has been making rounds in India for 15 years, the
appropriate ecosystem has now started to fall in place. The considerable rise in the number of
internet users, growing acceptability of online payments and the increasing number of internet-
enabled devices and favourable demographics are the key factors driving the growth story of e-
Commerce in the country. The number of users making online transactions has been on a rapid
growth stage, and it is expected to grow from 11 million in 2011 to 38 million in 2015.

Online Travel Industry

Online travel has traditionally been the largest e-Commerce sub-sector (by revenue) in India.
Nevertheless, online retail is catching up fast and is expected to match online travel revenues by
2015. To improve margins, online travel players are diversifying their offerings to include hotel
reservations, along with the regular ticketing services. To make the most of this move, players
will need to develop skill sets that are different from the ones required in the ticketing segment.
They will have to manage challenges associated with a diverse supplier base, technological
constraints, customer experience, authenticity of information and grievance re-dressal.
Although online businesses had begun to develop in the late 1990s, the supporting inputs had
not been put in place. The first wave of e-Commerce in India was characterized by low internet
penetration, a small online shopping user base, slow internet speed, low consumer acceptance of
online shopping and inadequate logistics infrastructure. Thereafter, the IT downturn in 2000 led
to the collapse of more than 1,000 e-Commerce businesses in India. Following this, there was no
activity in the conducting in India between 2000 and 2005.
The entry of Low Cost Carriers (LCCs) in the Indian travel sector in 2005 marked the beginning
of the second wave of e-Commerce in India. Travel emerged as the largest segment. People
began relying on internet to search for travel-related information and to book tickets. As a
effect, the success of the online travel segment made consumers comfortable with shopping
through the medium, thus leading to the development of online retail.

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The decision of LCCs to sell their tickets online and through third parties enabled the
development of Online Travel Agents (OTAs). The ticket sellers developed their own websites
and partnered with OTAs to distribute their tickets online and, thus, contain costs. The Indian
Railways had already implemented the e-ticket booking initiative by the time LCCs commenced
their online ticket booking schemes.
Online retail: The growth of online retail was partly driven by changing urban consumer
lifestyle and the need for convenience of shopping at home. This segment developed in the
second wave in 2007 with the launch of multiple online retail websites. New businesses were
driven by entrepreneurs who looked to differentiate themselves by enhancing customer
experience and establishing a strong market presence.

Share of Contribution
2%

6% 5%

16% Online Travel

E tailing
Financial Services
71%
Classified
Other online Services

The online travel segment has seen a growth of 55.5% from 2007-2012. The is due to rise of
disposable income, surge in demand for domestic travel and the boom of the tourism
industry. Domestic travel contributed to as much as 50% of the total market, followed by
railways tickets, international air tickets, hotel bookings and bus tickets.

The Indian online travel market is highly fragmented. Indian Railways, the market leader.
Other major players like makemytrip.com and yatra Online.The portals have transformed
from a mere ticketing website to a complete travel guide. To reduce the dependence on
booking, these portals have introduced deals and package tours. The online travel segment
market is expected to grow at a 32% for the next 5 years and will remain a dominant
contributor to the total e-commerce revenue.

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 Online Bus Ticket Booking in India:

One of the major modes of transport in India is Bus. Now with good roads, online bus ticket
booking and Volvo buses road travel is comfortable. As flight rates are high and train tickets
are well booked in advance, travellers preferred to look for bus ticket availability online. For
a shorter distance routes like – Ahmedabad to Mumbai, Ahmedabad to Jaipur, etc. bus is
become one of the most preferred mode of travel.

How it started: The Indian bus transport industry has long been a highly fragmented and
unorganized sector. Some 2,000 private bus operators run about 20,000 buses on long
distance point-to-point routes. The buses are formally known as "contract carriages" and
tickets have to be bought in advance. Short-distance "stage carriages" form the other category
of buses in India; to ride these buses, commuters buy tickets on the vehicle itself and can get
on and off at multiple points.

While a few contract carriage operators have large fleets of about 100 buses each, most are
small players with five to 10 buses. Some firms operate with only one or two buses each. The
bus operators are all regional players lacking a countrywide presence. Given the scale of their
operations, the majority of them do not offer computerized ticketing or reservations. Instead,
the companies rely on a network of travel agents to handle bookings. Agents are given quotas
of seats from the bus operators; they inform the bus company by phone each time a seat is
sold to a passenger.

But the travel agents to not have any information regarding the status of the seats given to the
other agents. The end result: a losing proposition for the bus operators, the agents and the
customers -- who often end up seat less. The system has other limitations. In most cases,
there are no provisions in place for booking return tickets. Usually, there are no published
fares and the customers end up paying what the agents demand for a ticket. There is no
standardized system of numbering seats, meaning customers are not assured of seat
preference. The bus operators often have cash flow problems because agents usually pay
them monthly.

Present Scenario: Booking an inter-city bus ticket in India is fairly simple these days. A few
clicks on the Internet or a phone call is all it takes to complete a process similar to the one
used to purchase airline tickets. There was an online world before the advent of the World
Wide Web in the form of private and commercial online services. Travel technology played a
significant role in the e-commerce world at this point of time.

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Prior to the Internet, consumers would generally access to the relevant information visiting
upon the actual site. Even if they had access to the resources of professional buyers, they
would manually and rationally sift through the reasonable deal of time. But now is internet
age.

If you want anything, just make a gentle click and get access to hordes of related sites. Pick
and fix up the offer you like most. It gives advantage greatly to get things simply, completely,
conveniently. The online bus ticket booking has its advantages, as it is a function to pay
money online and gain the impression of the price tag. In addition, one has the function of
collecting a variety of security and therefore the nature of the seat window or aisle. These
options are enabled by most state transportation companies. Book an individual buses in the
bus terminal can be a bit tedious. Chances are that you cannot get the price as the result of
service errors.

An increasing emphasis on train and road bookings – According to Applied Travel

Intelligence, online car rentals and bus reservations will be a $150 million business by 2011.

Via has pioneered the online travel B2B model in India. One of the biggest paradigm shifts in
the way travel has ever been sold globally. Via pioneered an inclusive business model, where
they could bring to a customer, best in class travel services through retail.

We thought, whether there is need to compete at all, when all they needed to do is reach the
customer..What they created is a global company delivering locally in each neighborhood, in
the most personalized manner, which is the dream of the servicing industry, local knowledge
helped us deliver phenomenal products, in his language, his currency with precision which no
CRM system could beat.

Advantage of online bus-ticketing:

Online bus tickets can be booked through the internet and you can do at any time of day. The
website is open for maximum hours and you can be sure that you do when you have time.
Bus tickets online has many advantages in fact and you can avail the services at any point of
time and not have to be physically present in any of the ticket counter to buy tickets. If you
are a travel freak and have no idea about the whole process of bus tickets online then let me
tell you that there are procedures available in cyber space and it is becoming very popular
with each passing day.

The bus tickets online process has many advantages and people use it like never before. If
you are travelling and then it was just obvious that you should not worry about other things
in life and bus tickets online can help you in that regard the tension has free travel where You

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can look at yourself enjoy fully. For any long distance travel via road is clear only that you
will avail a bus to travel and so you have to book tickets online. It takes a lot less time
and you can do it at your convenience. Purchase online in advance also makes sure that you
get the best seat in the bus, so grab a comfortable seat in the bus and have a great time with
your family.

The whole process of booking tickets can now be done through cyber space and it will take
more than a few seconds. You just have to make a few clicks of your mouse and the
computer generated system will take care of the whole issue. You can now look to book
bus tickets online has many benefits and people are using this process as never before
because it is effective and takes a lot less time. So you too avail the services and make sure
that you will quickly and effectively.

The online travel industry is certainly marked for growth in coming years. The best is yet to
come for the sector with broadband penetration just starting to take off. India is all set to
become among the top 3 online travel markets in the world over the next decade.

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 INTRODUCTION TO COMPANY

RedBus.in

RedBus.in, is yet another engineer who chucked his lucrative job to start an enterprise of his
own. In fact, RedBus.in was founded by three engineers -- Phanindra Sama, Charan
Padmaraju and Sudhakar Pasupunuri -- who studied together at the BITS, Pilani, and later
worked in various companies in Bengaluru.

Started modestly in August 2006 with a few seats from one bus operator, redBus today is one
of the most successful online bus ticket booking agencies. Today, it has 700 bus operators,
10,000 buses listed on it, works in 15 states and sells around 5,000 tickets every day.

Before starting redBus, Phanindra Sama was working for Texas Instruments, Bangalore. He
was a Sr. Design Engineer there. As a child I was always fascinated with electronics – the
way electrons flow in a wire and make a fan rotate etc., were very interesting to him. After
studying electronics Engineering from BITS-Pilani, he was happily settled with electronics
job at Texas Instruments.

During Diwali of 2005, he wanted to spend the festival in my home town, Hyderabad. Since
he didn’t know my schedule till the end, taking a bus was the only option.

He ran around town hunting for a ticket, but they were all sold out before he reached the
travel agents. Bangalore traffic is notorious and can grip you at the wrong time. That’s
exactly what happened that day. Also, he realized some key issues with the then-existing
model:

Travel agents don’t have all the information regarding all the possible bus operators. This
lead to a gap and customers had to take decisions based on limited information. Most of the
agents were not able to sell return bus tickets.

That’s when they thought of the possibility of solving these issues by putting together
information on a platform where customers could access it easily and take better decisions.
The internet was the best medium to deliver all this information and make possible e-
commerce to purchase return bus tickets.

This was the beginning of redBus. The initial hurdle was to move out of our comfort zone.
They were very pampered at our respective jobs and they were shielded from the tough world
outside. Once they were on our own, we started to face the world outside – standing in front
of the gates of companies to market our product, take beating from customers who had
problems, work very hard to convince bus operators about our idea and how it could help
them etc., He was a big mental hazel to sail through them. They had a good set of Co-
Founders and they could sail it together lending one’s shoulder to the other in the hour of
need.

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Sudhakar, Charan and Phanindra Sama studied together at BITS-Pilani. In Bangalore, they
were sharing an apartment. Before starting redBus, Charan was working for Honeywell and
Sudhakar was working for IBM. Sudhakar had some technology patents on his name too.

Phanindra Sama would say one should look for both. Co-Founders need to be smart,
hardworking and mature. There needs to be high level of maturity because many things start
falling apart during the first few days of startup. If Co-Founders start blaming each other, it
would all fall apart.

In the year 2006, finding a new job was not that difficult. Especially for people with
experience. That was one of the strong confidence boosters for us. We thought if they didn’t
do then, maybe they will have to wait for many years to try our hands on entrepreneurship.

However, major push for the decision was when we were selected by TiE. When they were
selected ( 1month before we launched our service), they were very confident of our decision.

redBus is being mentored by the TiE Entrepreneurship Acceleration Program. TiE

accepts rolling nominations for the program. What it means is you can apply to the program
anytime. Once they get good no# of nominations, they call for a in person presentation to TiE
charter members. If selected by the members, you get about 2-3 mentors assigned. These
mentors, depending on their bandwidth, help you with day to day working of your startup. If
you didn’t like any of your mentors, you can ask for a replacement. All this is done for free
by TiE. If you like, you can voluntarily give some stocks in your company to your mentors
and TiE.

They raised the first round 6 months in to business. Actually, once they were selected by TiE,
they started getting calls from VCs. We went ahead with an early stage investor because they
invest a lot of time in mentoring and grooming the company and that’s what they required
then.

The 2nd round was raised in 2008 . Inventus and Helion were investors. This was to help
grow the company. One of the biggest challenge is to propagate the same company culture
and value system in multiple geographies. They do this by travelling often and by writing
emails to everyone at least once in a week.

Phanindra Sama think startups should start organizing their structure every day. It’s a part of
their growth. In their case, they were limited only by their understanding of what it takes to
build and organize a company. They attempt doing it everyday and have small successes
every now and then. This on an aggregate, over an year, results in a big change.

He think a lot of things are in the right path regarding entrepreneurship in India. He witness
to the sea change in this space in the last 5 years. A few successes now (from existing
entrepreneurs) will accelerate this pace and they will find many people coming forward to
setup companies.

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Phanindra Sama say that don’t be very focused on e-service alone. Look at your customer and
ask how best you can serve him. For, an offline, phone based channel could well be a bigger
opportunity than e-service.

RedBus has crossed the one-crore (10 Million) mark in the number of tickets sold in July
2012. It has over 2 million registered users and is rapidly approaching the $200 million GMV
(gross merchandize value) mark. The company lays a lot of focus on keeping their costs low.
In May 2013, RedBus begin running their first series of Television ads. It does not own any
plush offices, nor are the locations anything to boast about. Most of the properties are in
nondescript locations, often close to the bus terminal redBus aggregates 228,000 seats per
day, sells more than a million tickets a month and has 600+ full time employees. The core
business model of redBus is commission revenues on successful transactions.

RedBus.in has 65 percent of market share in online bus-ticket booking in India and other 35
percent is shared by rest of players like Travelyaari, AbhiBus and SimplyBus sites.

Today you can book a redBus ticket at over 30,000+ outlets!

redBus has the largest network of bus operators in their list (350+ and growing) and very
satisfied customers. Some of them have been generous enough to write us testimonials and
we have showcased them on our site. It is these compliments that get the whole team working
from morning to late at night. On offer are over 4500+ (and growing) routes across the Indian
map.

RedBus.in operations:
Redbus has three key areas of operation. First, its portal, redbus.in, is the consumer-facing
travel agency where customers can book a seat for a bus on their own. As their second
business line, Redbus sells its software to operators on a monthly fee based on the
number of buses the operator has.Finally, through its reseller business, Redbus gives access
to its system to bus operators and charges a commission for each successful transaction.
Overall redbus.in accounts for more than 70% of the company’s revenues.

RedBus.in was taken over by the Ibibo Group, a joint venture of South Africa's Naspers and
China's Tencent in June 2013. This is the journey of RedBus.in from an simple idea to huge
enterprise success.

Mission:

Focus & effort to satisfy the customer eachneed and maintain the loyal customer base and
that trust to be translated into a new volume of landmark.

Achievements :

• Forbes - Top 5 hottest start-ups

• Business World - Top 3 enterprises in India

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• AllWorld Network - India's fastest growing company

• Deloitte - Top 5 fastest growing companies in India

• Star award achiever - Youth Marketing forum

• IAMAI - Internet start-up of the year.

Goals and Objectives

• To Achieve Annual Revenue Of INR 5 Billion by 2015 by,

I. Focusing on Core business

II. II. Vertical Integration
III. III. Increase in Service portfolio
IV. IV. Going global.

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 Concepts of marketing management:

Marketing is everywhere. formally or informally, people and organizations engage in a vest

number of activities that we could call marketing. Good marketing has become an
increasingly vital ingredient for business success. And marketing profoundly affects our day-
to-day lives. It is embedded in everything we do from the clothes we wear to the most costly
luxuries that we use.

Needs, Wants,
Demands

Offering and
Segmentations
Brands
Core
Marketing
Concepts

Target
Value
marketing and
Proposition
Positioning

Needs, wants and demands:

Needs are basic human requirements. People need air, food, water, clothing, and shelter to
survive. People also have strong needs for recreation, education, and entertainment. These
needs become wants when they are directed to specific objects that might satisfy the
needs.Wants are shaped by our society.

Demand is wants for specific product backed by an ability to pay. Many people want a gucci;
only a few are willing and able to buy one. Companies must measure not only how many
people want their product, but also how many would actually be willing and able to buy it.

These distinctions shed light on the frequent criticism that “market create needs” or marketers
get people to buy things they do not want. Marketers do not create needs: needs pre-exist
marketers. Marketers, along with other societal factors, social factors, influence wants.

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Marketer might promote the idea that a Rolex would satisfy a person’s need for social status.
They do not, however, create the need for social status.

Understanding customer needs and wants is not always simple. Some customers have needs
of which they are not fully conscious, or they cannot articulate these needs or they use words
that require some interpretation.

We can distinguish among five types of needs:

1. Stated needs 0

2. Real needs

3. Unstated needs

4. Delight needs

5. Secrets needs

Segmentation:

Is a method of dividing a market (Large) into smaller groupings of consumers or

organizations in which each segment has a common characteristic such as needs or
behaviour. Market segmentation is sub-dividing a market into distinct and homogeneous
subgroups of customers, where any group can conceivably be selected as a target market to
be met with distinct marketing. Not everyone likes the same cereal, restaurant, college or
movie. Therefore, marketers start by dividing the markets into segments. They identify and
profile distinct groups of buyers who might prefer or require varying products and service
mixes by examining demographic, psychographic and behavioral differences among buyers.

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 Segment Marketing Niches Marketing

Levels of Market
Segmentation

Local Marketing Individual Marketing

Segmentation criteria:

 Identifiable: the differentiating attributes of the segments must be measurable so that

they can be identified.
 Accessible: the segments must be reachable through communication and distribution
channels.
 Sizeable: the segments should be sufficiently large to justify the resources required to
target them. A very small segment may not serve commercial exploitation.
 Profitable: there is no use in locating segments that are sizeable but not profitable.
 Unique needs: to justify separate offerings, the segments must respond differently to
the different marketing mixes.
 Durable: the segments should be relatively stable to minimize the cost of frequent
changes.
 Measurable: the potential of the segments as well as the effect of a specific marketing
mix on them should be measurable.
 Compatible: segments must be compatible with firm’s resources and capabilities.

Geographical segmentation:

 World region or country

 State
 City
 Neighborhood
 Density
 Climate

Demographic segmentation:

 age

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  gender
 family size
 occupation
 education
 religion
 income
 nationality

Behavioral segmentation:

 occasions
 benefits
 user status
 loyalty status
 readiness stage

Psychographic:

 lifestyle
 social class
 personality based segmentation

RedBus Segmentation:
The Indian market of online bus ticket selling is now filled with a number of competitors like
Abhibus , ticketgoose, makemytrip, expedia etc. The bus ticketing had always been an
unorganized, and in hindsight, an understated sector until redBus came into existence which
had the early mover advantage in the road transport segment with a very simple business
model that consisted a large number of bus operators and a huge market potential to cater to
with negligible competition. Red Bus was started as a means to provide customers with a
hassle free approach to booking of bus tickets which were till then in control of travel agents
whose operations often bewildered everyone. Road transport segment in a country like India
is the most viable option to choose during a time when no competitors existed and also the
business of online ticket selling was universally applicable without any demographic
differences.

The main demographic segments for its services were:

 The rural customers who generally buy tickets at the bus stops.
 The young middle class working population in cities who do not have the luxury of
time to travel to an agent or bus stop to get ticket
 The old and physically weak for whom it is difficult to get a ticket from the window.

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 A different way of segmenting the market will be on the basis of frequency of travel. It is as
follows:

 Daily
 Weekly
 Monthly
 Once in a while
 Based on seasons.
 On special occasions like festivals, new year etc.

Once it was successful during its initial launch, it launched services on various routes
throughout India by simple expansion of its services in Bangalore. It had a leverage with bus
operators who started using its product and sharing their inventories .Now every bus operator
wants to be associated with redBus, a situation which is drastically opposite of when this
company started

Targeting:

After the most attractive segments are selected, a company should not directly start targeting
all these segments -- other important factors come into play in defining a target market. Four
sub activities form the basis for deciding on which segments will actually be targeted.

The four sub activities within targeting are:

1. Defining the abilities of the company and resources needed to enter a market

2. Analyzing competitors on their resources and skills

3. Considering the company’s abilities compared to the competitors' abilities

4. Deciding on the actual target markets.

The first three sub activities are described as the topic competitor analysis. The last sub
activity of deciding on the actual target market is an analysis of the company's abilities to
those of its competitors. The result of this analysis leads to a list of segments which are most
attractive to target and have a good chance of leading to a profitable market share.

Obviously, targeting can only be done when segments have been defined, as these segments
allow firms to analyze the competitors in this market. When the process of targeting is ended,
the markets to target are selected, but the way to use marketing in these markets is not yet
defined. To decide on the actual marketing strategy, knowledge of the differential advantages
of each segment is needed.

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 RedBus Targeting:

The target of the business is to sell online bus tickets to educated middle class people of the
country who had a basic know how of how to use the internet and also to the rural class
through outlets and designated agents. The website shows a number of ticket options of
different price ranges and types of buses to choose from. Apart from the web interface, for
customers who do not have a credit or debit card the phone booking option is also available
with cash on delivery option at Rs.40 surcharge. The company’s initial target was to get as
many bus operators on board as possible however they were rejected outright since the idea
did not seem appealing to the bus operators who were more than happy to continue with the
traditional way. RedBus then changed it target to the customer pool such that with the
increase in traveller traffic the operators would give in .This plan of action worked as
expected. The growth of internet businesses as compared to the traditional businesses makes
for an interesting comparison. There is largely one company that dominates a business
segment when it comes to online businesses, whereas in the traditional businesses; there are
always two to three strong players in every segment. For instance, Coca-Cola and PepsiCo
are the two largest names in the cola business. However, in the Internet field, Naukri.com is
the only major player known for job search whereas Bharat Matrimony is the largest
matrimony website. Notably, redBus with its huge target audience scope and unending need
for road travel is expanding and is able to gain market share whereas smaller rivals are losing
market share.

Positioning:

When the list of target markets is made, a company might want to start on deciding on a good
marketing mix directly. But an important step before developing the marketing mix is
deciding on how to create an identity or image of the product in the mind of the customer.
Every segment is different from the others, so different customers with different ideas of
what they expect from the product. In the process of positioning the company:

1. identifies the differential advantages in each segment

2. decides on a different positioning concept for each of these segments. This process is
described at the topic positioning; here different concepts of positioning are given.

The process-data model shows the concepts resulting from the different activities before and
within positioning. The model shows how the predefined concepts are the basis for the
positioning statement. The analyses done of the market, competitors and abilities of the

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company are necessary to create a good positioning statement. When the positioning
statement is created, one can start on creating the marketing mix.

B2B and B2C:

The process described above can be used for both business-to-customer as well as business-
to-business marketing. Although most variables used in segmenting the market are based on
customer characteristics, business characteristics can be described using the variables which
are not depending on the type of buyer.

RedBus positioning:
RedBus currently positions itself as a bus ticketing company. They are very particular about
not giving the impression of an online bus ticketing company because they have realized that
the formats will keep on changing. They sell tickets through the internet, through mobile, call
centers, offline outlets and whatever format allows them to sell bus tickets. Even before
redBus, there were bus ticketing travel agents. The only thing is that the Internet came by and
none of them had built online platforms and that created an opportunity for them to cash on.
They realize that in the fast changing world they cannot afford to be only an online bus
ticketing company. Tomorrow another format can come along and they can become obsolete.

In the minds of the customer, redBus has become a benchmark of sorts which can only spell
well for the company. The company was the first to offer them services that were unheard or
even unthinkable in terms of bus travel. They have created and gone out of the way to
maintain goodwill with their customers. During its initial operations, there were many
occasions when a ticket on redBus became void because the bus operators used to cancel the
buses or modify their timings without notifying anyone. In such cases, the company used to
bear the cost of sending the customer to his destinations by the fastest means possible, even
flight. These goodwill measures have helped the company maintain a loyal customer base. It
currently has more than 2 lakh registered users and sells an average of more than 13000
tickets every day. There are competitions from various players but as long as redBus keeps it
strategy of keeping customers first, the rest can fall in place

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Value proposition:
The benefit (such as profit or convenience) offered by an organizations product or service. A
concise summation of the unique appeal of a product, solution or business to a targeted set of
customers or decision makers. Ideally, a value proposition differentiates the company or
offering from its competition by clarifying the sum total of important benefits that customers
care about and how the company can or will deliver them.

A compelling value proposition…

 forces clarity around the unique combination of needs, wants, demands, desires and
values that uniquely characterize your targeted customers.
 Provides the foundation for creating a compelling and differentiated offering that sets
you apart from competitors.
 Helps you realize rapid gains in market share for important market segments by
allowing you to focus your marketing and sales efforts.
 Allows you to customize your services and offerings; driving enhanced value
creation, increased profits and better customer satisfaction.
 Improve your operational efficiency by allowing the company to focus on the most
important customers.

Here are a few persuasive elements that add authority to your value proposition:

1. Customer testimonial: People like hearing from…well, other people. It’s why
customer testimonials are so effective at getting people to consider and believe your
offer. (Remember, just because you’re telling the truth doesn’t mean customers will
believe you. It’s your job to convince them.)

2. Assurance: Many companies promise the world, but if you can be specific about
what you plan to offer to make sure customers are happy, it will go a long way.
Instead of “Satisfaction Guaranteed,” try things like “Fall in love with it or send it
back in 30 days, no charge!” You can also offer assurance through the form of
support, community, and content. People love knowing that others will be there to
help them with their purchase.

3. Social proof: Outside of specific testimonials, social proof⎯such as notable press

features⎯serve really well for customers who might feel hesitant about buying from a
new company. You can also feature some interesting facts about your performance, or
the notable brands you serve, like we do on the Help Scout homepage.

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Offering and Brands:
A brand is a set of perceptions and images that represent a company, product or service.
While many people refer to a brand as a logo, tag line or audio jingle, a brand is actually
much larger. A brand is the essence or promise of what will be delivered or experienced.

Importantly, brands enable a buyer to easily identify the offerings of a particular company.
Brands are generally developed over time through:

 Advertisements containing consistent messaging

 Recommendations from friends, family members or colleagues

 Interactions with a company and its representatives

 Real-life experiences using a product or service (generally considered the most

important element of establishing a brand)

Once developed, brands provide an umbrella under which many different products can be
offered--providing a company tremendous economic leverage and strategic advantage in
generating awareness of their offerings in the marketplace.

An offering in marketing is the total offer to your customers. An offering is more than the
product itself and includes elements that represent additional value to your customers, such as
availability, convenient delivery, technical support or quality of service. A strong offering
differentiates your products from competitors and creates value by meeting customers’ wider
needs better than other options.

To develop an offering, you need to understand the factors that are most important to your
customers. Market research enables your development team to incorporate the product
features and benefits that reflect customer needs. However, it can be more difficult to identify
the non-product needs that make up the total offering. If customers need components or raw
materials quickly to keep production lines running, for example, including express delivery in
your offering gives you an advantage over competitors that only provide standard delivery.
Offering the convenience of ordering your products online, rather than visiting a store, may
represent value to some of your customers.

Support is an important element in a customer offering if you market products that are
complex, difficult to install or require regular maintenance. If you market consumer electrical
products, such as home entertainment systems for example, your customers will appreciate
the convenience of having a specialist install and set up the system to get the best
performance. A company buying a machine tool puts value on a proactive support package
that uses remote diagnostics to keep their equipment running efficiently with minimal
downtime.

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Quality of customer service is another intangible factor. By making courtesy calls after a
customer buys a product, you can demonstrate that you offer high levels of customer care.
Responding quickly to service requests gives customers confidence and peace of mind that
they are dealing with a reliable supplier. Customers put a different value on different aspects
of a product, so it is important to match the offering to the customer. By offering customers
different combinations of products and added value elements, a process known as “bundling,”
you can satisfy the needs of individual customers.

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 Market Environment Scanning
Analyzing Market Environment
RedBus came into being in a highly unorganised, heavily fragmented business environment
which lacked a national level binding professional association. Though the complexity of
RedBus’ operating environment has not been very high, the company faced high uncertainty
right from the beginning because of the fact that it has played the more prominent role of a
market creator. In the absence of clearly defined rules of engagement between the operators
and agents, the fickleness of their association with RedBus itself has been an important
contributor to the uncertainty.

To sum it up, the environment of RedBus mainly comprises of the following three pre-eminent
players. The trio and their characteristics that affect RedBus’ environment.
a. Bus Operators:
i. Highly Fragmented sector
ii. Highly Region, state specific business models
iii. Run under varying levels of regulations
iv. Varying levels of inventory utilisation

b. Agents:
i. High competition, low margins- hence distributed nature of the association
ii. No binding network and hence very loosely coupled with peers
iii. Lack of well defined processes and control mechanisms

iv. Challenges in managing cash flows from and to multiple operators and customers

c. Customers:
i. Small and insufficient quantities of credible service providers has created trust issues
ii. Customers have viable alternatives like railways etc, bus travel is generally the last
optional and is very seasonal in nature.
iii. Poor comfort, services to customers have driven customers away.
iv. Doubtfulness about online payments hinders e-commerce based options

It is also apt to mention here that redBus, by playing the market creator’s role has not only added
tremendous value to its own top-line but has also positively impacted the very environment in
which it operates. Experts like Forbes India have commented that redBus has had a Knock-on
effect on key players like agents, bus operators and even bus makers like Volvo by pushing up
their sales and making bus travel a lot more lucrative proposition both for the traveler and the
providers of services in the space.

In fact, it would shortly become evident that the company has astutely managed its environment
and has since its inception devised strategies followed by roll out of innovative products to
capture this large, unexplored market.

A macro environment also consists of the external factors that can influence the business. The
factors are often out of control. Factors include economic, demographic, political and
technological forces in business respectively. Business owners and managers often spend

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copious amount of times and effort to assess the overall economic environment in order to
determine the strength of each factor.

Macro environment analysis is a review of all the factors that a company is unable to control.
Companies conduct this analysis to stay abreast of the issue in the current business
environment. A common tool for conducting a macro environment analysis is the PESTLE
framework, which include factors from the political, economic, social, technological,
environmental and legal aspects in the business environment. The ultimate purpose of this
analysis is to create a strategy that will leverage as many of these external factors as possible
to the company’s favour.

PESTLE analysis:
A PESTLE (Political, Economic, Social and Technological, Legal, Economical) analysis is a
major part of the environmental scanning section of strategic management and it is used by
companies during market research and strategic analysis.

Using a PESTLE analysis helps a business to understand various macro environmental

factors that they need to take into consideration when determining the decline or growth of a
particular market.

Political factors:

There are many political factors affecting RedBus.in like laws regarding intellectual property,
online business taxation issue, legal validity of transaction, policies regulation.Redbus.in has
intellectual rights over its BOSS software and has abiding privacy policy publish on its site as
it has personal information about many people. The changes in policies of government about
e-commerce also affect the working of RedBus.in.

Economical factors:

Business cycle has a impact on RedBus.in as during recession people avoid leisure trips and
vacation which has direct impact on their sales. Also to get venture capitalist to invest in
online business is very hard to find in india as entrepreneurs still thinks in a convectional way
and the idea of doing business online does not fit to their mind which ultimately has impact
on growth of the business. The venture capitalist who acquired Redbus.in are foreign
capitalist.

Social factors:

India is a developing country internet users have started increasing but the people still thinks
in a convectional way and are not always ready to accept the change and are also not quite
aware of the change. Perceived physical risk, financial risk, social risk, psychological risk
and time risk of people of Indian socities hinders the development of RedBus.in. The major
concerns of online booking are ‘security of online payments’ and ‘privacy of personal

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information’. To overcome these social factors Redbus has developed an acute privacy policy
and have also stared Cash on delivery of booked tickets.

Technological factors:

For a growing start-up in internet domain, role of technology in shaping business and hence the
trajectory of growth can’t be underplayed. Redbus, fundamentally a technology driven company
highly leveraged Information Technology (IT) to propel its business and come up with innovative
solutions to tap the unorganized bus travel sector. The RedBus has trademarks products that
company offers to serve B2C and B2B segments. Innovation is the key when it comes to
sustaining in a fast-paced and dynamic industry. Impact of transition to cloud for all its
infrastructure and development needs enabled Redbus to iterate faster, focus on core business
solutions and hence provide array of solutions in less time. This is best summarized in words of
padmaraju himself “The use of cloud technology has given us the competitive edge that helps us
to innovate quickly”, In nutshell, Redbus played technology to its greatest advantage and bought
lot of industry-first innovative features which let it take the lead in the unorganized online bus
travel industry in India.

Legal factors:

There are many legality which has to be abide while providing service online and changes in
legal issue also has a great impact on RedBus.in. Redbus has to be cautious that no personal
information leaks from its server or he have to face the consequences. RedBus also has to comply
the licensing and its processes of working online. These factors affect the manner in which
RedBus runs.

Environmental factors:
Bus Travel industry in India is a highly unorganized market and is very dynamic in nature
when it comes to needs of customers, changing techniques to size the market, tapping the
operator network etc. By being very adaptable and responsive to environmental changes,
Redbus has allowed itself to respond to this changes in a very innovative manner by launch
out trademark products like BOSS, Seat-Seller etc. in due course of time. Transition to Cloud
at the right time is an example too.

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IDENTIFYING AND ANALYZING THE COMPETITORS:

Redbus faces competition from Ticketvala.com and Indiabusticket.com and a few other players in
the existing online travel market like MakemyTrip, travelyaari, abhibus etc.. But they have not
been able to replicate the business model of the redbus in entirety largely due to the large
customer traction that Redbus enjoys and effective partnership with bus operators.

Makemytrip.com:

MakeMyTrip is a leading Online Travel Agency which has the largest bus inventory in India
with over 8,000 buses, 500 bus operators, and over 5000 routes across 14 states in the
country. The company acquired bus ticketing company Ticketvala.com, including website,
URL, technology platform agent network and bus inventory, from Mumbai-based Travis
Internet in February 2010. It was Founded in year 2000 and has Revenue: INR 2,500 Crores
with 8000 number of buses.

Abhibus.com:

Founded in the year 2007, AbhiBus Services (India) Private Limited is a pioneer in providing
end-to-end software and other value added solutions for the Bus Transport Industry by
leveraging the latest technologies. The company also provides technology solutions to more
than 100 large private bus operators in India, 4 state transport corporations and 2 international
operators. The end-to-end software solutions include e-ticketing systems, fleet management
solutions, vehicle tracking systems, passenger information systems, logistics management
backed by a 24x7 customer support centre. With ticket inventory from over 1500 operators
and 15000 routes, abhibus.com is the preferred choice of booking, when it comes to bus
travel.

Travelyaari.com

Founded in 2008 Travelyaari is promoted by Mantis Technologies Pvt. Ltd. , which is

incubated at IIM Ahmedabad. The company charges only the ticket price from the
commuters. Travelyaari is a 100% real time bus tickets booking service. To ensure the same,
the company at certain places deploys their own computerized reservation system at the
operator's booking offices and agent network to ensure that their whole inventory is made
real time or &quoted live.

TicketGoose.com

TicketGoose.com, launched in August 2007 is a ticketing web portal. The Company.

TicketGoose is promoted by Efficsys InfoTech India Pvt. Ltd. It provides information like
price, availability and booking facility for buses to more than 3000 destinations in South
India and currently have more than 250 bus travel partners. Customers can also book bus
tickets from channel partner outlet which includes Corporate Sectors and Ticketing Agents.

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Market Share of RedBus.in and its competitors:

RedBus.in 65%
Travelyaari.com 15%
Makemytrip.com 10%
Abhibus.com 4%
Other players 6%

7 P’S OF MARKETING:
Product:
“Online Bus Ticket“was the essential product that determined the business. In the yester
years of 2006 there were only over the counter sales which consumed a lot of time for the
common man and also the unpredictability of the availability of tickets when in need was the
major hurdle. Although internet was widely available only IRCTC had the provision of
booking train tickets but none for bus tickets. Making use of the internet redBus.in offers
tickets with ease of sitting at home and buying hrough a friendly user interface giving option
of timing, AC/Non AC, Pick up and drop points, operator ratings, reviews etc. The paper
printed ticket is no longer required as redBus sends the ticket through SMS on the registered
mobile number and the same can be shown on boarding the bus. Such a product/service plays
a vital role in a market where the availability of one such service did not exist and
also considering the huge demand for road transport in one of the most densely populated
countries like India.

Price:

RedBus.in charges same tariff as that laid by the bus route dealers. It Charges ₹10 as
commission levied by the company for sale of each ticket from the bus operators.

The price of a ticket bought online through redBus widely depended on the transport provider
and the type of bus opted for. The price of the bus ticket is the same as you would get
from the bus operator. For online bookings, a two percent service fee is charged whereas; if
tickets are to be home delivered Rs.40 is charged. The advantage redBus has is that its
services were all online and they only had to onboard bus operators and automate their
inventory through BOSS ( Bus Operator Software Service). As operators could not afford
highly complicated IT upgrades to their infrastructure such software by redBus was accepted
and did not add in any form to the cost. The cost online did not vary extensively, moreover
redBus provided many options to choose from a wide range of prices. Comparison is easy for
a user to differentiate between a number of bus operators and hence the traveller’s sense of
approval also complied.

RedBus.in customer can avail additional discount to the extent of 15% by using credit/Debit
cards of ICICI bank & AXIS bank.

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Place:

Buses in India are a lifeline, along with manual and motorized rickshaws. There’s not
much joyriding happening in the country; it’s very much a “point A to point B” proposition:
A group of friends aren’t going out to a club; someone is going to the market to bring food
back for the family. When it comes to travelling outside the city in which residents live, the
bus is the only option. Such a place added to redBus’s online ticket booking service which
paved way for endless demand and requirement. The first service started in August 2006
registering a small bus operator with a few seats. redBus today is one of the most successful
online bus ticket booking agencies. Today, it has 700 bus operators, 10,000 buses listed on it,
works in 15 states and sells around 5,000 tickets every day.

RedBus.in offers Online dedicated platform through which the interested customers can avail
the service 24/7.

The users of Android or Apple products can download the RedBus app and book the tickets
and avail all other services directly through their mobiles.

Cash on delivery of tickets are available on major metros.

Promotion:

“Word of Mouth’’ has been more than just a promoter for redBus. It has been a guardian
angel making sure the inflow increased day by day. Along with establishing a centralized bus
system the company offers festival offers, coupons and promotional codes to generate a
strong customer base. Bengaluru is the IT hub of India and it was where redBus started its
first journey. Every day there a hundreds of passengers plying to and from Bengaluru and the
quality service offered with feedback from the customers played a major role in making the
website viral.

As promotion it also sends personalized emails directed towards the existing customers.
Mostly in terms of discounts and offers which is communicated through website and emails.

It does promotion in all social sites like Facebook, Twitter, You tube, News papers,
Magazine. And does Sales promotions by giving festival discounts, round trip tickets
discounts, best deal of the month special offers.

Physical Evidence:

The company dedicated website acts as the primary source of physical evidence. The
company logo along with the ticket both in case of print outs and Mobile app acts as
secondary physical evidence.

RedBus.in is offering best customer care service in support of physical booking/cancelling

booking/Printing E-tickets/Checking Refund. EVIDANCE as status and in making a payment

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People:

The People factor in terms of RedBus is completely absent as the end user never meet with
the intermediary red bus. The people factor involved in this business model is the end
customer and bus operator and it’s very crucial too, as RedBus can’t control the behavior of
bus operator and any negative instance from bus operator will impact even the image of
RedBus.

Process:

RedBus.in follows easy and simple process of booking tickets like filling up customer name,
phone number, address etc. And mode of payment is possible by any bank cards bank
debit/credit cards and also cash on delivery.

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