Shifting its focus to offline sellers services like advertising and marketing, Paytm Mall, has slowed down its rate of using monthly capital, often called ‘cash burn’ to ₹40 crore against ₹200 crore last year.
According to the company, it will focus on revenue generation by offering offline sellers services like advertising and marketing.
The development comes as planned by the company since it started moving its target away from a discounting and cashback-led business to an online-to-offline strategy.
Based out of Noida, Paytm was founded in 2010 by Vijay Shekhar Sharma with an aim to bring an ease in the digital payments ecosystem across India.
Whereas, Paytm Mall, is a platform provided by Paytm for user to shop, it works just like any other e-commerce website or application.
Furthermore, cash burn is the rate at which a company uses up capital to run day-to-day operations and is commonly seen across consumer internet firms which raise a bulk of investor capital.
Paytm Mall has shut its national ecommerce shipping business, which entailed onboarding sellers and shipping products across the country, cut marketing spends, and trimmed cashbacks by almost 80 per cent.
“We will continue to invest for another year on growth milestones and the year after that we will focus on turning breakeven,” Sharma said.
Paytm Mall’s O2O strategy is straight out of the TMall playbook, operated by the Alibaba group, also the largest investor in the Indian company.
“We ended the last financial year at Rs 13,000 crore and are targeting Rs 17,000 crore in GMV in a contribution-positive manner where we have cut our costs by one-third,” he further said.