Fee-based revenue model drives growth for Rediff.com Q2 in 2014

Rediff.com’s overall performance in the past two quarters signaled the emergence of an internet media business model in which fee-based revenue is the key driver and online advertising is in a supporting role.

Revenues from such fee-based businesses contributed to 54% of the India Online Revenue in the immediate past quarter. Such fee-based businesses for the quarter grew 31% on a year over year basis and helped to some extent offset a decline of 22% in advertising revenue. Overall revenue for the quarter ended September 30, 2014, declined 8% compared to the corresponding quarter last year.

The company’s diligent focus on analytics helped them achieve industry metrics for these businesses during the recently completed quarter, such as a 26% take rate (fees earned as a percentage of value of products transacted), a 14% positive product margin and a merchandise return rate as low as 14%.

Fee-based-revenue-model-drives-growth-for-Rediff-com-Q2-in-2014

Ajit Balakrishnan, Chairman and CEO, Rediff.com India Ltd said, “We are witnessing a change in our revenue streams where the revenues from the fee-based businesses are playing a leading role supported by the traditional display advertising revenues. We believe our strength lies in our ability to grow and monetize the 16 million + unique users coming to our site every month through various offerings for consumers and small and medium enterprises. The use of data science to monitor key business metrics is helping us keep our business performance on the growth path.”
 
According to ComScore Media Metrix, Rediff.com’s reach in India grew 17.5% on a year-on-year basis to 16.5 million unique users in a market which grew just 1% in the same time period.


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