Aggregator Business Model is getting increased day by day because of its ease of execution and large acceptance. For aggregator, it gives benefit of execution based on “Just in Time” while for individuals it gives benefit of large scale recognition. Food, Grocery, Cabs, Daily Bus Commute every sector is getting aggregated by entrepreneurs under one roof of their business models. Ola, Shuttl, Grofers, FoodPanda, TinyOwl, Swiggy etc are some of the examples of aggregator business model.
In aggregator business model, the individuals of same domain are accumulated under one roof by some player and the commission per sale / use basis gets into the pocket of aggregator. Though the profit margin is limited to small percentage per sale/use but due to large volume the total revenue goes to higher limits. Other ways to monetize/ generate revenue are by registration fees, paid advertisements etc.
Aggregator Business Model
FS brings a pictorial analysis of “Aggregator Business Model” – basic concept, revenue model, scope of improvement along with examples.
Though aggregator model alone will give return on investment in long run as the break even volume is generally high, combined with other business verticals, alternative sources of revenue generation and operational excellence would definitely make the aggregator model profitable in shorter span.
If the funds are sufficient enough to spend and take hit, initial cash burn marketing tactics should be used to attract consumers and make your presence visible. Otherwise, the focus should remain on getting loyal consumer base by incorporating CRM tricks and achieving operational excellence. The long term vision of aggregator startup – to become market leader or to get consolidated by big player, shall also be kept in mind to align the activities and strategies of startup as per the target need.
Stay tuned with FS Labs to know more. Wish you luck for your startup.