Rohan Verma, CEO, MapMyIndia
They know how to pick their battles. When Google Maps made inroads into India after its launch in February 2005, MapMyIndia (MMI) owners Rakesh and Rashmi Verma had a choice: to concentrate on the enterprise segment or take on the tech giant and burn cash with a 50-50 chance of success.
The Vermas, who founded the digital mapping product company in 1992, chose the enterprise segment, and rest, as they say, is a thriving business.
Today, MapMyIndia has a 90 percent share in the automotive space and counts top automakers such as BMW, Tata, Honda and Toyota as its clients.
It also works with startups such as ride-hailing firm Ola, digital payments major PhonePe and cycle-sharing platform Yulu as well as government organisations like the Central Board of Direct Taxes for their mapping product.
The battle won and sealed, MapMyIndia is gearing up for another fight, a big fight this time. It is looking to challenge Google on its turf–the consumer segment.
Rakesh Verma has no regrets going to the enterprises side first. "The only time I would have regretted was if we did not get into the consumer space at all," he says. Perhaps they could have got in a little earlier but they are entering the space prepared and are committed to making it work, he says.
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Move vs Google Maps
The decision coincides with the government’s push for self-reliance (Atmanirbhar) and calls for “vocal for local” following the coronavirus outbreak that disrupted supply chains and souring ties with China.
Recently, MapMyIndia’s Move app won the government’s Atmanirbhar app challenge in the navigation category. The contest was aimed at encouraging domestic companies after India banned around 59 Chinese applications.
The Vermas know that the “Indianness” tag or the Atmanirbhar call can get them so far.
“It is not an easy task but the company has a lot going for it too,” CEO Rohan Verma, who is the son of Rakesh and Rashmi Verma, told Moneycontrol.
The home advantage
Its clients and industry experts attest to MMI’s rich experience and accuracy but it will count for little in the consumer segment.
Move is an upstart so in a space that Google has virtually lorded over for 15 years, with the backing of its parent’s search engine capabilities, an immeasurable amount of data and very deep pockets.
Over the last couple of years, Move has had around three million downloads compared to more than 300 million-odd Android users, who get Google Maps pre-installed.
The gap is huge.
Rohan agrees but also points to gains the company has made.
“During the last six to nine months, we have turned a corner. Due to COVID-19, there has been a lot of stress on updated data on maps. We have managed to do that well,” said Rohan, who joined the company at 19 in 2004 to start MapmyIndia.com.
A graduate of Stanford and London Business School, Rohan made the CEO in April 2019.
The Move app has a coronavirus dashboard that gives district-wise COVID-19 updates, information about coronavirus centres, labs and containment zones.
The app also allows users to report bad traffic and roads, which get reflected in real-time.
And this is what the consumer segment will look like. Navigation will remain primary but consumers used to Google Maps will want Move to give them more information, which could be on traffic, local kirana stores, chemists or, pubs and more.
It is in rural areas where MMI is way ahead of Google Maps. Google Maps is excellent in big cities but the same can’t be said of rural India, a Bengaluru-based developer, who has worked with car aggregators in the mapping space, says on condition of anonymity.
The company has mapped 6.5 million km, covering the length and breadth of the country, and that is why it works well, says Rakesh Verma. He would know—they have driven to each corner of the country over the last 25 years.
So when Rakesh says, “We know India better than everyone”, he means it.
They have gone strong on partnerships as well.
“If you had asked me two years back if MapMyIndia has a chance in the consumer segment, my answer would be no,” says Sanchit Vir Gogia, founder, Greyhound Research, a tech consultancy firm.
Over the last two years, the company has come a long way in forming partnerships and expanding its developer ecosystem through its application programming interface (API), similar to what Google has done but at a smaller scale, he says.
The hyperlocal nature of data and its accuracy has served the company well.
“Our technology choice was driven by data richness and service availability which MapMyIndia offers,” Sameer Nigam, the co-founder of Walmart-backed PhonePe, says.
Another factor that works in its favour is the focus on the quality of curated data for businesses and rural India, he says.
A top executive at a unicorn which uses MMI says the company competed with Google and was not keen on partnering with it for APIs.
An API is a piece of software that helps two or more apps to talk to each other. It is like a messenger that takes the message, delivers it to the app you want to interact with and gets back a response. A lot of data is exchanged in this “conversation” that is why companies are careful when it comes to APIs.
Strong partnership ecosystem
As refreshing the concept of partnering with an Indian company is, the ecosystem is equally important. And here, Google is the clear winner.
“I am repeating here but Google Maps did spend 15 years in the consumer space. They have Alphabet Inc backing them. This headstart in a space like digital maps is a lot,” a Bengaluru-based engineer, who works in the space, said on condition of anonymity.
This headstart means tons of data that is of great value for developers to build maps, use them for visualisation purposes or by car aggregators for routing.
Maps also reveal customer behaviour, which is mined by companies for ad revenues.
Google Maps earns close to $4.3 billion per year, with $3.5 billion from ads and $0.8 billion from APIs and partnerships with companies like Uber and Lyft for integrating its map into their application, Kamil Franek, a technology analyst, has said in his blog.
It gives Google additional data on real-time traffic and hence more ad revenue.
Google is yet to respond to Moneycontrol’s queries on its market dominance, competition and revenues from India, one of its largest markets.
The tech giant is facing increased scrutiny and backlash for collecting user data and privacy breach. It has also been accused of “search bias” and abusing its dominance as a search engine.
Will it help MMI grow?
These concerns would have to be addressed but taking on Google will call for a lot more.
MapMyIndia is not looking at ads as a potential revenue stream and it will take time for the company to scale in the consumer space. Also, the Vermas say ads are not a part of their revenue model and “privacy is important”.
While privacy is an issue, it will not make a lot of difference, says an expert. “I estimate that people who choose MMI for privacy and accuracy would be in a minority,” the expert says, requesting not to be identified.
Nobody wants a monopoly and companies will want a good alternative to Google, say experts. So, should the government step in?
Any startup should be able to enter a market, compete fairly with incumbents and win based on value created for its consumers, PhonePe’s Nigam said.
“Government intervention is typically needed when someone is creating artificial entry barriers, or when a platform is abusing its dominant distribution advantage,” Nigam said.
That is not the case, at least for now.
Building a sustainable business
MMI has built a sustainable business over two decades and has given good returns to investors. It is profitable and has cash reserves to build its consumer-map business.
Building this war chest was one of the reasons the company took time to enter the consumer space, says Rakesh Verma.
MMI’s revenue comes from licensing map products, its services and solutions such as GPS tracker.
According to data provided by Tracxn, the company’s revenue for the year ended March 31, 2019 was Rs 162 crore, against Rs 161 crore in the previous year. Profit for the same period stood at Rs 39 crore and Rs 35 crore, respectively. Between 2015 and 2017, revenue grew from Rs 115 crore to Rs 140 crore.
The last the company raised funds was in 2015, from Flipkart, when it was valued at Rs 1,600 crore. The deal gave an exit to older venture capital funds like Lightbox and Nexus Venture Partners.
The company counts Qualcomm and Zenrin, a Japanese map publisher, as its other investors.
For a company so focused on sustainability, where will the revenue come from? Move was already bringing in revenue, says Rakesh Verma. It complements the company’s GPS device that consumers can buy off the shelves for their four and two-wheelers.
The device cost between ₹3,000 and ₹6,000.
APIs and partnerships are the other revenue streams but Google leads these spaces.
MMI needs more data and it can be done by extending partnerships to last-mile connectivity, allowing on share real-time traffic data, Gogia says.
The company, so far, has not been able to nail it, experts say.
While companies may use MMI, drivers and delivery staff are more comfortable with Google Maps, a force of habit that is hard to change. A lot of work needs to be done here, Gogia says.
MMI needs to give users good reasons to dump Google for Move. It can turn to local language support, a better solution to traffic issues or use of intuitive tech to tell a user if the neighbourhood kirana is open or if it is crowded. Google does some of it but there is a lot more that can be done.
If MapMyIndia can crack these, Google is in for a tough fight.