If you don’t have the right balance, you will find yourself firefighting without the necessary support that you need, which could jeopardise the sustainability of the business
While working for P&G, Reynazran Royono was frustrated that he was unable to get customer purchase information on time, which, he says, could have helped the global consumer goods brand to better position and market its products. His frustration continued even after he moved to Boston Consulting Group, where he worked with a few multinational consumer goods companies as clients.
“On the other extreme, I saw the power of real-time analytics in industries like telco and e-commerce, where I had the opportunity to lead Berniaga.com before it was sold to OLX,” Royono, who is popularly known as ‘Rey’ in the startup world, tells e27. “Hence the idea came about, on how we are able to apply the real-time capability we saw in online business, into offline purchase. This is uber important, given the fact that more than 90 per cent of purchases are still happening through offline channels.”
This led Rey to start Snapcart, a company that blends technology with the offline retail. Started just a couple of years ago, Snapcart has already made its presence felt, not just in Indonesia but in the Philippines as well.
An Artificial Intelligence-powered mobile app, Snapcart gives shoppers cashback for scanning their receipts. In the process, it collects a massive amount of purchase data, analyses it and offers it to brands on a real-time basis. Brands leverage this data to improve their marketing and boost sales. A win-win to both the consumer and the brand.
“Our cashback app is merely a mean for us to extract information from shoppers in the region, and the intent is to provide real-time analytics solution that drives strong insights to our partners,” Rey says.
Snapcart has just bagged $10 million Series A financing, led by existing investor Vickers Venture Partners, which also saw participation from Wavemaker Partners, Social Capital, Kickstart Ventures and Endeavor Catalysts. This comes just a few months after the cash-back-cum-analytics startup raised US$3 million in a pre-Series A.
According to Rey, the latest funding is a big step for B2B startups focusing on data analytics. It is also an important milestone on how Indonesian startup is able to scale not just within the country, but also at a global level. Snapcart is not restricting itself to just Southeast Asia; it has already started testing the product in Brazil.
Left: Snapcart Founder and CEO Reynazran Royono
Indeed, Snapcart is not the only company in Asia that blends technology with the shopping craze of the youth. India-based magicpin also works on a similar concept wherein it provides cashback to customers for sharing a selfie with their bills.
“We already have features within the app that will enable us to get crowdsourced information from shoppers. We do however need to make sure the activities that we are implementing in the app will not bias the data by influencing shoppers to purchase certain brands or from certain merchants. This what differentiates us greatly from other cashback apps, such as magicpin,” he says while explaining the USP.
In addition to AI-based Optical Character Recognition (OCR), the company has also used fraud detection capability and Machine Learning SKU identification to develop the product. It is now working on a smarter OCR to read receipts, given the very low quality of receipts provided by retailers in Indonesia (for example, the ones printed using dot matrix printer).
Within this year, Snapcart also plans to launch a new platform that Rey claims will tackle the unstructured trade information, meaning stores which do not have a cashier and hence do not produce receipts.
For Snapcart, revenues come mainly from brands. Says Rey: “We provide real-time offline shopper and consumer insights to brands. Through our receipt-scanning cashback app, we collect billions of data points at an individual shopper level, an unprecedented level of data granularity in the market research industry. This brings brands much closer to a holistic understanding of shoppers. Snapcart can identify optimal promotion level to maximise revenue, help evaluate media spend effectiveness, deep dive into purchasing habits, and many more.”
In Indonesia, online shopping is still in the lower single digits, and so Snapcart has set its eyes on the offline shopping industry as of now. But as it grows, it will look to explore ways to also track purchases happening in online channels to provide a more complete share of wallet between offline and online channels.
The market that Snapcart is targetting is massive: US$40-50 billion globally and US$5 billion in Asia. He hopes that with the support of multinational consumer goods companies, Snapcart will be able to expand its businesses beyond Asia.
“We believe we will be able to support our clients to fill in gaps of data to help them track their performance as well as optimise their spending. Though we start with consumer goods clients currently, it is always possible for us to serve other verticals in future,” adds Rey.
Like other serious entrepreneurs in the world, Rey had also faced numerous challenges while setting up Snapcart, but two things have helped him come out of difficult times: “One is to make sure that you still have your personal life by doing things you love. For me it is related to hobbies that I like: sports, video games, travel. Two, to understand that there are many misfortunate people out there that struggle with life, and doing some CSR or non-profit activities will remind you of that.”
What are the biggest learnings Rey had made as an entrepreneur?
“Ensure balance between building your product and building your organisation. Eventually, as the company scales, if you don’t have the right balance, you will find yourself firefighting without the necessary support that you need, which could jeopardise the sustainability of the business,” Rey concludes.