Online space for used cars Droom is gambling large on its new ecosystem tools to bring growth as it looks to invest hugely to build complementary source of revenue using allied services.
The company is supported by Singapore-based Beenext and Digital Garage, a Japanese investment firm. Droom has set aside a sum of Rs. 225 crore solely for marketing of its new tools over the next one year.
New ecosystem tools
The new ecosystem tools comprises of Orange Book Value which is a pricing tool, Droom Eco which deals with inspection, Droom History which provides vehicle history report and Droom Credit which looks after loans and financing part. The company will solely focus on these four services for one year.
Higher investment will surely brings fruitful results
The company’s move towards marketing to bring new business and revenue comes even after investors are putting pressure to curb cash burn to bring profit. Aggarwal has a different point of view and believes that 2.25 times higher investment in this sector as compared to Rs 100 crore of last year would surely bring fruitful results of high class.
Tools are doing very well
This is not an exaggerated move
While this move is seen as sceptic, analysts who are aware of the business of the platform believe that the increased marketing expenditure is not an exaggerated move.
Best time to increase marketing spend
Devangshu Dutta, CEO at consultancy firm Third Eyesight, said that, “If a company has the resources, the best time to increase marketing spend is when others are tightening their belt.At such times marketing expenses are low, as is competition for the consumer’s mindshare”.