Thursday, May 31, 2012

4 reasons why sports-persons are starting up eCommerce biz!

It is one thing to play some sport and it is another to be in a business of sports! But not in India, yes! We are talking about Sporstpersons turning businessmen. It seems the eCommerce bug has bit them too!
What started with Zaheer Khan and, Yuvraj Singh and, seems to have caught attention of Tennis star - Mahesh Bhupathi as well.  

Mahesh has made entry into eCommerce by launching Live Sports 365 E-Retail Pvt. Company will sell brands like Adidas, Yonex, Puma, Wilson, Babolat,etc especially in Tier 2 and 3 where such brands are either not present  or have little awareness. (More)

We, at Boring Brands, probed a bit as to why would a sports person want to invest in eCommerce , let's see -
1. Long term investment - Average sportsperson's professional life is not more than 10 years (unless you are a Sachin Tendulkar or Leander Paes) and hence it is critical that they think of some long term investment. eCommerce is a great bet, especially when today it is one of the most vibrant part of Indian economy.  Valuations in eCommerce beat any other industry hands down - e.g. Flipkart valued at ~ USD 1BN with revenues claimed at USD 100  Mn (Source)
2. eCommerce is on steroids and multiple times the investments looks assured if succeeded - While there are nay-sayers who believe industry is hyped, a rational look suggests that a skeptic investment in the industry will not get wasted. Penetration of eCommerce is still paltry 1% (10 Mn people out of 100 Mn on Internet in India).  Non-travel eCommerce today in India accounts for USD 0.4 Bn (1.4%), compared to 55 Bn in China (3.0%) and 166 Bn in US (4.5%). Expected to become 12 USD Bn in next 4 years!
3. Sports eCommerce is seeing some great traction recently - It seems to be that bigger players are looking at sports as an industry much closer to increase their range for consumers.
1. bought for ~ 10 to 15 USD Mn
2. Healthkart, an e-health store, recently announced the acquisition of another e-health store called MadeInHealth.
3. Another health focused online venture LifeMojo, which offers wellness products such as Fitness & Sports Equipments, Organic Products and others was recently acquired by Via.
If Sports365 does make it big, it might be gupled by big start-ups for bigger sums! (Cool money! heh!)
4.  Turning the table from branding viewpoint - Today the celebrity brand of the sports persons are way too big than the venture, but if the venture does become big , it might ensure a continual brand endorsement for the celebrity!
What do you think is the most important reason for sports person to turn business? let us know via comments!

Published on Boring Brands
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