Our country has witnessed a rise in the pre-used car business since last decade. Folks are preferring second-hand cars over new ones. Reason? Purchasing a second-hand car not only offers value for money but also you are less worried about minor wear and tears! The rise in demand for pre-used cars was a golden opportunity for startups that operate in this segment.
And one such famous startup is “Spinny.”
Founded in 2015, it became one of the top-most companies offering exclusive pre-used cars. Do you know its market valuation has spiked to $1.61 billion (Rs.13,202 crore)? How did it become a unicorn within 8 years? You may wonder.
It is due to the Spinny business model. Yes, its brilliant working strategy, diverse revenue system, and eye-catchy marketing methods are the key pillars of its business model.
So, let’s delve into the Spinny business model!
Spinny: A Brief Overview
Spinny is a modern platform where you can buy or sell used cars seamlessly. As per the reviews of the users, it is a 100% trustworthy platform. Really? Yes! It has over 5000 fully-inspected second-hand car models. You can select any one of them.
Not only it offers a hassle-free car buying and selling experience but provides after-sales services. A pre-used car-selling firm offering after-sales services is no less than a dream for customers. We will discuss it in detail in the upcoming sections.
For now, let’s have a brief overview of the company-
|Name of the Company||Spinny|
|Operating Industry||Automobile Industry|
|Type of Brand||D2C (Direct-to-Consumer)|
|Legal Name||ValueDrive Technologies Pvt. Ltd.|
|Headquarters||Gurugram (Haryana, India)|
|Founders||Niraj Singh (CEO), Ramanshu Mahaur, Mohit Gupta, and Ganesh Pawar|
|Market Valuation (FY22)||$1.61 billion (Rs.13,202 crore)|
|Revenue Earned (FY22)||Rs.180 crore|
|Expenses (FY22)||Rs.670 crore|
|Competitors||Cars24, Droom, SheerDrive, etc.|
Note: We have already discussed “Spinny Valuation, Funding & Shareholders Breakdown – 2023.” You can visit the article for deeper understanding.
Working Strategy: How does Spinny work?
Spinny works by providing a convenient and transparent platform for buying and selling cars. The following points describe the working strategies of Spinny-
1. Well-Organized Inventory
Spinny is a pre-used car selling-buying platform. Remember, it is an independent platform and doesn’t act like a middleman nor does it involve any of them. It simply buys the cars from owners and sells them to customers. It offers a curated selection of pre-owned cars that undergo a thorough inspection and certification process to ensure quality.
2. Car Sourcing, Inspection, and Certification
Spinny sources used cars from various channels, such as direct owners, dealers, and auctions. Each car undergoes a thorough inspection and certification process to ensure its quality and condition. This step is crucial for building trust with customers.
3. Phygital Approach
The certified cars are then listed on the Spinny website and app, along with detailed information and images for customers to browse.
The firm operates through a phygital approach meaning a physical + digital approach. You can call it a hybrid model that combines online services with physical outlets all across India. This approach allows customers to have a seamless buying journey, with the convenience of online browsing and the assurance of physical inspection and test drives.
4. Transparent Pricing
Spinny provides transparent pricing for its vehicles, making it easier for buyers to understand the costs involved. The pricing criteria depend on the quality of the vehicle and its chances of survival in the future. The transparent pricing model provides customers with the best prices based on the car’s condition and market value.
5. Hassle-free documentation process
Spinny aims to simplify the paperwork and documentation process to make the buying and selling experience smoother.
6. Car Selling Process
Here comes the most awaited part of Spinny’s working strategy. In case you are looking to sell your car, Spinny is a perfect place! Why is it better to sell your car to Spinny instead of a direct customer? Because you will get a better valuation of your service. Also, you will be free from the nagging nature of the customers.
So when you sell a car through Spinny, you will have to follow a couple of steps. First of all, your car will be evaluated by Spinny’s experts. You can select the inspection place which can be your home or workplace. Then, those experts will validate your car’s worth and will make a final offer. It will be valid for 3 days. In the meantime, your car will undergo a certification process to ensure its quality and condition.
Once you accept the offer, Spinny will instantly clear the payment for the car. Thus, you will get a convenient selling experience with transparent pricing.
7. Car Buying Process
Well, it is a bit lengthy but interesting process. It is similar to window shopping for apparel. How? Go through the points given below to know it-
- Spinny website browsing: The official website of Spinny offers over 5000 cars. You can choose any one of them. Also, you can personalize your search with filters. The filters include price range, body type, models, etc.
- Details: After selecting the car, you can check out the detailed 200-point inspection report, features, specs, and price. This process will give you assurance of the car’s quality that you are looking to buy.
- Test Drive: Spinny offers doorstep test drives, allowing potential buyers to experience the car before making a purchase decision. You can chat with the experts about any aspect of the car to have a better understanding of the car.
- Payment: After you are satisfied with the quality of the car, you can go for the final step i.e. payment. The firm supports most national and international banking partners. You can make payments through major credit/debit cards and the net banking system. It also offers fractional payments or installment payments through UPI (Unified Payment Interface).
8. After Sales Support
This is the most anticipated service of Spinny. Because you will rarely find any firm that offers after-sales support for second-hand cars. Spinny provides a limited warranty on its cars and offers after-sales support to address any issues that may arise. It includes warranty options and assistance with any queries or concerns.
How Spinny’s approach is different and unique from other platforms? You may ask. See, other platforms require customers to hand over their car before receiving payment. But Spinny never lags when it comes to the payment process. With Spinny, the payment is cleared instantly, giving sellers peace of mind and a faster return on their car sales.
Thus, Spinny simplifies the car buying and selling process by enabling online payments, offering a convenient valuation process, and ensuring prompt payment to sellers.
Revenue Sources: How does Spinny make money?
In the fiscal year 2022, the total revenue of Spinny grew at the rate of 4.5X to Rs.180 crore. If you compare this with the revenue earned last year, you will notice a massive difference. Because last year it earned Rs.39.7 crore (FY21).
Spinny operates on a full-stack business model in the pre-owned car market. It has a strong control over the entire process from car inventory to the retail experience. This model enables Spinny to generate revenue through multiple channels.
Some of the major revenue sources are-
1. Car Sales
Spinny buys, refurbishes, and sells old cars. It acquires used cars from individuals and also sources them from auctions and dealerships. After refurbishing and certifying the cars, Spinny sells them to customers at a markup, generating profit from the price difference between the acquisitions and selling prices.
2. Value-added Services
Spinny offers additional services such as car inspections, extended warranties, and car financing, for which they charge fees, generating additional revenue. Car inspections contribute the most when it comes to additional services. The inspection services for car sellers, include charging a fee for conducting inspections. Also, the after-sales service packages are an essential revenue stream for the company.
3. Commission on Sales
Spinny earns a commission on each successful transaction that occurs through its platform when a used car is sold. Isn’t it the basic operation of this company? Yes, it is. But when it comes to commission, there is a twist. Spinny also acts as a platform for individuals who want to sell their cars directly to customers. In such cases, Spinny assists in the sale process and earns a commission on successful transactions.
4. Partnership Programs
Spinny has tie-ups with financial institutions, insurance companies, and other service providers. Through these partnerships, Spinny earns referral fees or commissions when customers opt for their services through Spinny’s platform. Thus, Spinny earns revenue through partnerships with financial institutions and insurers.
Thus, Spinny business model combines revenue streams from car sales, additional services, commissions, and partnership programs, allowing the company to generate profits in the pre-owned car market.
Marketing Strategies of Spinny
Spinny, a full-stack user car platform, has implemented various marketing strategies to build its brand and attract customers. Some of the common marketing strategies of Spinny business model include-
1. Digital Marketing
As you know, Spinny is a phygital platform where it combines online and offline services. It has a user-friendly website that utilizes various digital channels to reach its target audience. One of their strategies involves using the campaign objective of maximizing clicks with a Target CPA-building (cost per action) strategy. It uses the following digital marketing methods to reach its target audience-
- Social Media Marketing
- Search Engine Optimization
- Online Advertising
2. Content Marketing
The official website of Spinny is filled with informative articles, blog posts, videos, and guides. These contents educate the customers and engage the audience about the car market. Thus, it establishes itself as an authority in the used-car market.
3. Customer Testimonials
This is the most effective marketing strategy to build trust in the heart of customers. The Indian folks are highly swayed when they see honest testimonials from the users. Similar is the case with Spinny. It has acquired its user base and built its reputation through positive feedback and testimonials from customers.
4. Celebrity Advertisements
In 2022, Spinny launched its first national marketing campaign named “Khushiyon Ki Long Drive” (The Long Drive of Happiness). This campaign featured brand ambassadors such as Sachin Tendulkar and PV Sindhu, who are well-known figures in India. The campaign aimed to highlight the joy and happiness associated with buying a used car through Spinny.
Thus, these marketing strategies have helped Spinny establish its presence in the used car market and connect with potential customers. By focusing on maximizing clicks, transparency, authenticity, and leveraging brand ambassadors, Spinny has effectively reached its target audience and created a strong brand image.
Spinny business model is transforming the used car market with its technological advancements and customer-centric approach. It operates on a direct-to-consumer model, providing a curated selection of thoroughly inspected, certified, and warranty-backed pre-owned cars.
Spinny handles the entire buying process, ensuring transparency and convenience for customers. By eliminating middlemen and showroom overheads, Spinny offers competitive pricing and better quality assurance. Their customer-centric approach and tech-driven solutions have led to significant growth and customer loyalty.
In conclusion, Spinny’s business model disrupts the traditional used car market. It focuses on trust, convenience, and value that benefit both buyers and sellers in the process.