How Licious Killed Meat Shops Owners ? | Licious Genius Marketing Strategy | Business Case Study
If you are a non veg lover then you must have heard about Licious. Today after delivering more than 20 lakh meat orders per month, Licious became first P2C company to attain Unicorn Status. That means its evaluation crossed 1 Billion Dollars. An insurance broker and investment banker who didn't had in depth knowledge of meat industry then how they built India's largest meat brand ? And most importantly what are those business lessons we can learn and implement in our business ? So the story starts in 2015 when Abhay Hanjura used to meet his friend Vivek Gupta regularly on meals. They both were non veg lovers and once they discussed an idea. Can we sell meat online ? In starting, they used to deliver from their scooter. .
But they soon realized that it's not working. Customers are not coming and cash is burning on daily basis. And then they decided to stop Licious. They were stopping the business but Abhay told Vivek that 'Let's try one more time, What if something great happen ?'. With this thought, they enter in the market again. Founders realize that after spending lot's of money if customers are not coming then It has something to do with our business processes. And from here everything changed for Licious. .
But the question comes that what did they do that a meat-selling company is a Billion Dollar Brand ? So Abhay and Vivek Sir identified a big gap in market. And to fill this market gap they used this 3 business strategies. This strategies were so simple that anybody could implement them. The question is if they were so simple then why nobody implemented it ? And most importantly what are those 3 business strategies ? But before that there's a surprise for you. Tell me one thing honestly, Swiggy, Ola, Unacademy, Byju's – If you got a chance to invest your money in these company when they were raising their initial funding rounds then think how much money you had now. .
I know you will say – 'How can we do it ? ' Well unfortunately you were unable to do this things before but now but time has changed. And here our partner – Tyke helps you. So by using Tyke you can invest in the startups from 5000 Rs. The best thing is here all your transactions are 100% transparent. No hidden charges and no annual maintanence charges. Just complete KYC and start investing. You must be thinking that how to decide in which startup should we invest ? Let me tell you a simple way .
1) Check financials of the startup, how are their current financials going. 2) Check pitch deck of startup. By these you can know what product they are selling now and on what products they will work on in future. 3) After investing, check dashboard of your Tyke profile and regularly monitor it. If you liked the idea then Link In Description. You can invest in these startup by Tyke. Enough of watching Shark Tank, its time to become a Shark now. Coming back, after doing market research founders found that India is world's 2nd largest population. But in India, 68% people are Non-Veg. .
In India, 30 Billion Dollar meat industry is completely unorganized. After identifying 2 critical problems in meat industry and designed their 1st business strategies. The strategy was Predictable Experience. When they did market research they got to know 2 things about meat market. 1) Dependency In India, most of the people are dependent on their nearby meat shops. 2) Quality Meat can be arranged anyhow from anywhere. But what if there's infection in meat or the meat is steroid grown. .
Interestingly when they talked to consumers, people want to solve this 2 problems. But due to lack of options they buy from wet meat shops. After understanding this meat market problem, From Day 1 Licious delivered quality meat within 2 hours to customers and built Value Proposition. And due to Licious's this value proposition it created a Predictable Experience for customers. That if you want quality meat within 2 hours then order from Licious. But do you know what – When they started they did this 2 big mistakes which costed them a fortune. 1) Shadowed Business Model They both started business but had no structured business model. .
Both knew that they want to deliver quality meat but How ? No processes were designed of these things. And when there are no quality processes designed then there are high chances that it will shut down. Not only this, they promised 2 hour delivery service in starting but never worked on how to deliver in 2 hours. And as a result their all starting orders were late. And due this reason during initial 4 months, customers were coming but at the same speed going. And they were going to shut down Licious. But if Licious didn't made this mistakes then they never would have introduced this legendary business model in market. And the model name is – Farm to Fork Model .
In simple words, getting the complete value chain in the business. Now understand this very carefully. Value chain something looks like this. In every business, there are some primary activities and some secondary activities. These activities are majorly included in primary activities – 1) Inbound Logistics – Arrival of raw materials. 2) Operation – Working on that raw material. 3) Outbound Logistics – To send produced product in the market. 4) Marketing and Sales – You sold product in the market. .
5) Service – You sold the product but you also have service to customers. But all this tasks will fail if not supported by secondary activities. Mainly this 4 things are included in secondary activities – 1) Firm Infrastructure – How is your firm's infrastructure ? 2) Human Resource Management – How are human resources ? 3) Technology Development 4) Procurement – From where you bring your goods and at what cost. After combining both primary and secondary activities, a business value chain is formed. When this things are involved and done then only your business creates value in the market. .
So let's see how their process works. Firstly, they tie up with live stock farmers and fishermen. They also provides doctor to them for consultancy that how in healthy environment they can breed this animals. When meat is ready, Licious procure it from farmers and fishermen in temperature controlled trucks to godown. From godown it moves to distribution centre. Here their own butchers pack meat in different assortments in healthy environment. If you ordered meat from Licious then you would always find these 2 things – 1) No Black Polythene No meat comes in packed in black polythene, always packed in white transparent packets. .
2) Vacumm packing Due to this meat doesn't expire fast. When they are packed then they are out for delivery. Licious's wastage which was 40% but by using data analytics and forecasting demands they brought it to 3%. 3%. Today they are able to give 2, 6, 12 hour deliveries to their customer and that to with quality. Well you would be thinking that a country which is price sensitive then how can someone buy 200 Rs chicken for 400 Rs. And from here Licious made it's 3rd strategy. It's name is GAS – General Adaptation Syndrome. This is a biological process responsible for making a habit. .
In scientific terms GAS means when our body passes through any stress it absorbs it and adapts it and prepares it for higher stress. Interestingly, General Adaptation Syndrome applies not only in stress but also in happy and satisfaction condition. I am sure many people use coffee to stay waked up. If you daily for 1 week drink 1 cup coffee then after 1 week 1 cup coffee won't work for you. You would need atleast 2 cups of coffee to stay waked up. The question is Why ? So the answer is General Adaptation Syndrome. B'coz drinking 1 cup coffee everyday now your body became habitual to 1 cup coffee. Now the coffee will start working less Now your body needs 2 cup coffee to stay waked up. .
The question is how Licious used it? When Licious took their first funding, rather than in marketing they spent in operations and quality product. And then made people habitual to eat good quality meat. Many less people know that Licious is 1st company to have FSSC Certification – which is considered highest global standard of quality. After having a nice quality meat people's pychology changed so they now wanted nice quality meat only. B'coz of General Adaptation Syndrome – their body adopted it. This is the reason that when you feel hungry you order from Swiggy or Zomato. B'coz they made your habit to do so. When you get this quality with so convinience at home that it make it very very adaptive. .
Most importantly what are those business lessons we can learn and implement in our business. 1) Don't think if you want it, people want it too. Business is about problem solving but people take it too seriously that they create businesses from their personal life problems. Without thinking that is that problem with many people or not. It can be the problem is for you only. Abhay and Vivek did market research, talked to customers and then came to know that people want quality meat but no options. And then decided to start their business. Always remember never make product first, always study consumer behaviour first. This brings us to second business lesson .
2) Trust is the most expensive thing for customers. If people don't trust your product they will never buy it. It can happen cheating you can make money for first time but not always. And trust builts when you deliver consistent predicted value to customer. When you timely fulfill your commitments then they will stick with you for long. When you don't fulfill your commitments customers switch. And this thing happened with Licious during initial days. And if Licious didn't fixed it at that time then Licious wouldn't exist. This brings us to 3rd and most important business lesson. .
3) Do your analysis When something wrong happens we start being arrogant to ourselves. I wanted you to go back in times and many times it happened that things were not happening how you thought. Rather than controlling that situation you blamed someone or situation. This is a piece of advice for you – When things are not going according to you then take a step back. Sit and anaylize that thing properly. Without blaming others with full accountability take responsibility. And most importantly, make an unbiased study. Never do a biased study b'coz then your decision will also be biased. .
And that decision can be harmful for you as well. Licious also did this. When things were not going accordingly they properly and unbiasely anaylized it and then took any decision. The moment you blame someone for something, you loose the power to change things. And did you thought to invest in these startups. If you are ready then go and check Tyke – Link In Description. BTW many people think Nokia failed b'coz they didn't adopted Android. But this is not the case, the story is different. You will know after watching right side video… .