In February, nine-year-old Cashify changed gears. Less than a year ago, in March 2021, it claimed it would be profitable within six months. That goal is now out the window. Instead, the Gurugram-based company, which deals in used and refurbished electronics (chiefly, smartphones), is doubling down on growth.
Cashify has earmarked Rs 100 crore—nearly a third of the $40 million it has raised so far—for marketing in 2022. Its marketing budget now stands at ~3X what it was for the year ended March 2022.
What changed for Cashify?
On the one hand, Covid-19 pushed both work and education online, supercharging the need for smartphones. On the other, the supply chain issues it caused led to a shortage of new smartphones new smartphones The Indian Express Chip shortage hitting entry-level smartphones the most Read more —especially entry-level offerings. Cashify, which buys used phones, refurbishing and reselling them, was perfectly placed to fill this gap.
Cashify, however, also has a problem—supply. In a country like India, there’s insufficient awareness about sending used devices back via sale or exchange. While India saw 161 million new smartphones in 2021, only a sixth found their way back into the supply chain, as per market market BGR.in India is the fastest-growing market for second-hand smartphones: ICEA Read more research firm IDC.
“For most original equipment manufacturers (OEMs) or e-commerce platforms, the exchange rate hovers around just the 10-12% mark. The main reason is that customers do not want to deal with the hassle of data transfer at the time of delivery or are not sure if they will end up liking the new device. A large number of devices also end up in drawers as backup devices,” Mandeep Manocha, Cashify’s CEO, tells The Ken.
Cashify’s marketing blitz, Manocha hopes, will go some way towards fixing this. In August 2021, the firm enlisted Bollywood star Rajkummar Rao as its first-ever brand ambassador, and followed on from this just over six months later by signing on Rashmika Mandanna, a popular south Indian actor, as well.
This isn’t the only visibility the company is aiming for. Cashify has also rapidly expanded its offline footprint in metros and tier-1 cities to 103 stores. This marks a 70% increase since 2021. It plans to increase its store count to more than 150 by the time 2022 winds to a close.