For online tickets, there is only one showstopper
An idea that germinated in the wilds of South Africa and burst with the dotcom bubble in Y2K, Bookmyshow is alive and kicking today, thank you very muchbusiness Updated: Mar 07, 2016 13:36 IST
Ashish Hemrajani, backpacking in South Africa in 1999, heard over the radio that tickets to a rugby match were being sold online. The rest of the trip, and on the way back to India, he could think of nothing else. Once back, he quit his job at advertising firm J Walter Thompson to set up his own company, one that would sell tickets online.
His co-founders, Parikshit Dar and Rajesh Balpande, were also on the same trip to South Africa with Hemrajani. They thought long and hard before taking the plunge: not many in India were using the Internet at that time. But Rs 2.5 crore from Chase Capital to fund the idea fuelled their ambition, helped by the growing number of cinema-goers.
They set up a company called Goforticketing, which was later renamed Indiaticketing, and in 2007 became Bookmyshow. It barely survived the dotcom meltdown, but has now become the online gateway to movies and events in the country with 90% of all online tickets. Talk about market dominance. But it wasn’t always so.
Offline firm, online heart
In the early days, Bookmyshow was far from dominant. Using the money from Chase (Chase later sold its stake to Rupert Murdoch’s News Corp), the founders bought tickets in bulk from cinema hall owners in advance. They made losses on weekdays and profits on weekends. Almost 90% of tickets were booked on the phone and delivered at home. It was the beginning of ‘cash on delivery’.
At heart, though, Bookmyshow was an Internet company. It had a website that allowed booking of tickets, charging a nominal service charge. Bookmyshow expanded and built up a team of 150, just like many others riding the dotcom wave. After the year 2000, it shrank, just like the others riding the dotcom wave. Money dried up. As the end seemed near, Hemrajani, Dar and Balpande got job offers. But something made them stay put. Only six people remained, including the three founders. From 2002 to 2007, they did call centre work for cinema halls.
Then things started to change. “The time was right, 50% people were buying tickets online,” says Hemrajani. Some 20-odd other online ticketing firms came up, but they had to contend with Bookmyshow, the entrenched one. It had built relationships with cinema hall owners. It started e-ticketing once again.
The re-launch started with four cities and soon spread to 350. There were problems, some of which became opportunities. Cinema halls did manual auditing. The box office ticket counter had to be automated. Bookmyshow built the systems for it, so that the ticket counter and the Internet booking site worked in harmony, showing the same booked and available seats. After months of discussion, Regal Cinema, in New Delhi Cannaught Place, became the first to embrace automation. Others followed. More than 80% of multiplexes now use Bookmyshow’s technology.
It changed the way the government audited movie tickets. Earlier, theatres had to preserve the counterfoil of tickets. Bookmyshow convinced the government to automate it. “We evolved the entire system. An automated report is done, which can be monitored by the government,” says Hemrajani. The e-ticket, which can be booked on a mobile app, now suffices for the theatre, customer, and the government.
Not just movie tickets
For Hemrajani, it was never just about the movies. He never forgot the online booking of rugby tickets in South Africa. Bookmyshow soon ventured into sports, events and plays. It sold tickets for 1,500 events in 2015, compared with a combined 200 in the eight years between 1999 and 2007. This year could be much more, given that it started on a busy note with the Auto Expo, at which Bookmyshow also managed the crowd and food.
Within the business of selling tickets, new things are happening. For the Indian Premier League’s franchise Rajasthan Royals, which has been scrapped, Bookmyshow offered dynamic pricing. Once the occupancy reached 70%, the prices automatically changed, the way they do for airline tickets. “We have people in data analytics who help our partners do ticketing in the best way,” says Hemrajani.
As the business grew, Bookmyshow needed more money. In the middle of 2014, venture capital firm Saif Partners gave Rs 150 crore. As much as the money, the valuation made news: a nice round figure of Rs 1,000 crore.
However, the business outside movie tickets is not a free run. KyaZoonga is one of the many rivals it has to contend with. “Movie ticketing is a weekend business, the economics isn’t sustainable,” says Neetu Bhatia, founder and CEO of KyaZoonga, which gets 50% of its revenue from sports events.
KyaZoonga, too, provides technology to its clients. For the last five years, it has been managing tickets for the Jaipur Literature Festival: online and offline. Five years back the entire process for the Lit Fest was manual, but now 60% to 70% of the tickets are pre-registered.