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Baidu’s Investments: Inside the Indian Online-to-Offline Initiative

Parker Thomas

The Secret behind Internet Giant Baidu's Growth Stimulation

(Continued from Prior Part)

Diversify geographically

Baidu (BIDU) is looking to invest in a few e-commerce Indian startups to understand the business dynamics and strategies followed in the Indian O2O (online-to-offline) space. The move will also help the company geographically diversify its transaction services, such as food delivery and movies ticketing. Specifically, Baidu is planning to invest in Zomato, BookMyShow, and BigBasket—all Indian e-commerce startups that have been successfully penetrating the O2O space on the subcontinent.

Zomato

Zomato provides its users to search and review restaurants and food delivery services. Recently, the company added the service to its portfolio after acquiring NextTable in 2015, which allows users to search for a place and then book a table. Zomato is generating 35% of its revenues from India, and it has a presence in five international markets, including Indonesia (IDX) and the United Arab Emirates.

BookMyShow and BigBasket

BookMyShow provides ticketing service that combines the offers from Fandango and the Live Nation Entertainment (LYV) subsidiary Ticketmaster. BookMyShow has currently captured 80%–90% market share in India. Apart from India, it operates in four other countries. The company’s revenues grew by 1,000% between the fiscal periods of 2009–2010 and 2014–2015.

Similarly, BigBasket is an online grocery that is currently running its operations in 18 Indian cities and is looking for further expansion. The company is expected to generate revenues of $1 billion by 2017, and the grocery industry is expected to reach $1 trillion by 2020.

Last month, e-commerce giant Alibaba (BABA) announced that it plans to buy 33 million shares of Groupon (GRPN) to penetrate US market. In fact, last year, Alibaba and Ant Financials invested around 3 billion Chinese yuan, or around $464 million, apiece in Koubei, which provides an O2O platform to connect online users to brick-and-mortar food stores and restaurants.

In the next part, we’ll look at Baidu’s mapping service through O2O.

Continue to Next Part

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