B2B or B2C dilemma in maintenance

industry: UrbanKare
Rajeev Verma, G.K. Murthy Kothapalli and Ranjani Kumari

Introduction Rajeev Verma,

G.K. Murthy Kothapalli and
“We want to organize and automate this unorganized and non-automated service sector.”
Ranjani Kumari are all
– Mr Balkishun Kumar, Co-founder, UrbanKare
based at the Faculty of
Marketing, Chandragupt
In May 2019, it was the fourth repeat purchase from a satisfied customer, when Ms. Usha Institute of Management,
Jha called up UrbanKare to order painting and renovation services for the exterior walls and Patna, India.
prayer room, respectively, of her home. She said that it was very easy to handle
maintenance issues with the help of UrbanKare. She said reliability and professionalism
were non-negotiable for one to trust a stranger with the maintenance of one’s home – and
UrbanKare had ensured that. Usha, a member of Mahila Udyog [1], Bihar, was a loyal
customer of UrbanKare. She had availed of numerous services like painting, interior
designing of kitchen and hall, plumbing and even landscaping of garden from UrbanKare.
With the help of services such as beautiful interior and exterior works, she was able to keep
her house looking new. She was one of the most satisfied customers of UrbanKare, as the
latter was reliable and dedicated, with competitive pricing. UrbanKare was a new innovative
service platform, a smartphone/web-based marketplace, which connected customers and
service providers. It helped customers solve maintenance issues at their homes and offices
through the app or the internet. UrbanKare Internet Pvt. Ltd. was a startup for repair and
maintenance services, founded in the year 2016, by Ms. Swati Anand (Swati) and Mr
Balkishun Kumar (Kumar) in Patna in the Indian state of Bihar.
Swati (Co-founder and CEO) and Kumar (Co-founder and Director) were both engineers by
training and first-generation entrepreneurs. Neither had any experience in business
management. They started their journey in 2015 when Swati while trying to have a leaking
faucet at home fixed, had a firsthand experience of the hassles of finding professional
service providers. It prompted the duo to carry out a preliminary investigation into the
challenges facing customers – residential and business customers – while trying to address
repair and maintenance issues. The findings of the research showed that the major
challenge residential (business-to-consumer [B2C]) customers faced was to find service
providers (repairmen, plumbers, electricians, etc.) that were trained (and thus competent),
reliable and professional – and that charge a reasonable and consistent price. However, a Author (s) thanks all the
unknown reviewers to
vast majority of professional service providers in India were semi-literate and not formally strengthen and further enhance
trained. Although relatively cheap (in comparison to the ones available on the Internet- or the quality of the case.
Disclaimer. This case is written
app-based marketplaces), they varied widely in the service fee they charged (arbitrary and solely for educational purposes
inconsistent prices – across providers and across time); were mostly unreliable (a customer and is not intended to represent
successful or unsuccessful
would call them up multiple times and keep waiting, for days on end, for someone to show managerial decision-making.
up!) and unprofessional (they could not always indicate, upon assessing the problem at The authors may have
disguised names; financial and
hand at the customer’s premises, the estimated cost or completion time upfront – and would other recognisable information
not clean up after completion of the job; sometimes the job done was so shoddy that the to protect confidentiality.

DOI 10.1108/EEMCS-12-2019-0328 VOL. 10 NO. 4 2020, pp. 1-25, © Emerald Publishing Limited, ISSN 2045-0621 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 1
 customer was forced to call the service provider again, within days and the cycle
repeated!). One of the respondents, Vibha Singh, said, “it’s very difficult to find local service
providers at the time of requirement: the experienced (and thus popular) ones are too hard-
pressed for time while the rookies may be easily available but I cannot trust them.”
The research also revealed that for a business customer while price was not always the
overriding consideration, predictability and consistency of a professional service provider
were, given the long-term nature of the engagement. Said Rahul (project associate at
Software Technology Parks of India (STPI) [2], Patna), a business customer, “most of the
independent local service providers are unreliable and unprofessional: they hardly value
your time; further, once you do engage one, you must personally oversee their work, full-
time (which is a drain on your precious time), to ensure they don’t botch, and you get your
money’s worth.” Upon discovering the needs and pain points of customers, the duo hit
upon the idea of establishing a marketplace that could connect customers with service
providers, while addressing the former’s pain points. Kumar said that though service
providers were available in large numbers, there were gaping holes in the quality of service
provided. He added that the industry was largely unorganized and presented them with an
opportunity. The primary motivation for setting up the firm was thus to bring professionalism
to an industry where it was sorely lacking.
UrbanKare was currently serving both residential and business markets, with a focus on five
key services: painting (exterior and interior walls), interior design, modular kitchens, mural
art and electrician services. They also offered integrated solutions (total building renovation)
combining most or all of these services. Three building renovation contracts were currently
underway – two in the residential market (for one domestic customer and another, a non-
resident Indian) and one in the business/government market (for a department of the
Government of Bihar) – ranging from ‘2,500,000 ($34,000) to ‘5,000,000 ($68,000) in
value2. Integrated solutions, however, typified the B2B market, whereas most orders from
the B2C market concerned plumbing and minor electrical jobs. The firm witnessed steady
growth in revenue since its inception in the year 2015 (Exhibit 1). However, a couple of
important statistics made it imperative for UrbanKare to choose between residential and
business markets so as to avoid spreading itself too thin – and pursue growth: orders from
the B2C market currently accounted for 95% of total, with an average ticket size of $9.5,
while those from the business-to-business (B2B) market accounted for the remaining 5%,
with an average ticket size of $325. While UrbanKare was currently a regional player with
operations in a few smaller cities like Patna and Ranchi, most of its competitors –
UrbanCompany (more on this later) for instance – were active and strongly positioned in the
larger cities of India. As the firm was keen on expanding its operations beyond its home
state of Bihar – and the neighboring state of Jharkhand – Kumar had to make an informed
decision on the market to target – B2C or B2B – that made better sense, from operational,
financial and strategic perspectives.

Company background
Upon observing the absence of reliability and professionalism among independent service
providers (e.g. plumbers, electricians, carpenters, painters, repairmen and interior
designers), Swati and Kumar found a gap in the market of unorganized repair and
maintenance services industry. Their research into the needs, wants, pain points and
decision-making process of customers revealed interesting insights. For instance, service
providers were largely self-taught, rarely punctual and extremely inconsistent in the service
fee they charged. It was not uncommon for customers to book a plumber and wait endlessly
for him to show up, as the latter would rarely turn up at the appointed time. Yet, customers in
the B2C market tended to stick, paradoxically, with their old ways of relying on the
unreliable neighborhood plumbers, partly because the latter were relatively inexpensive
compared to the ones available on the newly emerging app-based marketplaces – and

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partly out of habit (“better the devil you know”). On the basis of the research findings, the
duo founded their venture, Calltolocal, in 2015, which subsequently was renamed and
registered as UrbanKare Internet Pvt. Ltd. (UrbanKare) on Nov. 29, 2016. UrbanKare was
incubated by the Department of Industries, Government of Bihar, through a network of
management institutions approved and notified by the latter as Incubation Centres. It was
recognized as a startup by the Department of Industrial Policy and Promotion, Government
of India. It was founded with an aim to provide customers with convenient and reliable
repair and maintenance services on demand, at transparent and consistent prices.
UrbanKare began with two services in its portfolio – plumbing and repair of air-conditioners
– but soon expanded it by adding painting, interior design, modular kitchens and
“integrated solutions” (total building renovation) as the latter offered a higher revenue
potential. In terms of the volume of annual remittances from Indians working abroad, the
state of Bihar stood second [3] in India: several people had their permanent homes in Bihar,
which were left unoccupied, while they worked abroad. When they visited their homes in
India on important occasions such as festivals, a good chunk of their brief vacation time
would go into repair and maintenance of their unused properties before they could begin to
celebrate. Interviews with a few such visitors revealed that they would be happy to entrust
the mundane task of repair and maintenance of their properties to a professional service
provider and that there was currently no such service available. UrbanKare offered repair
and maintenance services through a smartphone-based app and the internet (www.
urbankare.com). Customers could browse the services available and book what they
wanted; a service provider and a time slot would be assigned. On completion of the job, a
customer would pay the service provider, who would then share a predefined portion of the
fee with the firm and keep the rest.
Though customers, at least in the B2C market, readily accepted UrbanKare, the volume of
orders and average ticket size remained quite low initially, coupled with a high service
provider (service partner) attrition: providers would complete an assigned customer order
and quit, after pocketing the entire fee collected, often without intimation. The firm would
find itself at a loss on two levels: partner attrition and revenue loss. Customers, however,
were largely satisfied with the quality of service provided. Kumar found the attrition
frustrating as it meant scouting for a new service partner each time a trained one quit,
resulting in wastage of resources invested in hiring and training. Over time, however,
service providers seemed to have woken up to the long-term benefits of staying with
UrbanKare, as the latter ensured a steady stream of customer orders and revenues, which
an independent service provider would hardly get.
About six months later, UrbanKare received its first major order (contract) from one of its
existing customers, a professor at a state university. He ordered painting of his house and
requested UrbanKare to help him turn it into a landmark in that part of the town. This was a
real challenge for the team at UrbanKare and helped them learn a lot. With the passage of
time, brand awareness started rising, albeit slowly, as did the reliability of service partners;
the firm was now more stable, with a certain volume of smaller orders each month and an
occasional large order.
However, Kumar had a larger vision: he wanted to differentiate UrbanKare through
automation, which had the potential to radically transform customer experience and chose
painting as the first service in the portfolio to experiment with. To make machine painting a
reality, he expanded his service team and purchased machines such as sanding machine,
jet sprayer and putty mix. By early 2017, customer queries started coming in not only
through the app but also through the Internet. UrbanKare got itself listed on JustDial, a
leading business directory, which significantly boosted the average volume of queries per
day to 45. Kumar then turned to interior design, another profitable offering in the portfolio, to
modernize through technology. He found that there was an untapped market for internet of
things(IoT))-based projects, both in consumer- and business markets and started

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 3

 developing interior designing solutions with cloud-based design and IoT. Over time, the firm
started receiving larger orders of renovation and interior designing, in the consumer (B2C)
market, mostly from individuals working abroad, who had their permanent homes in India.
Customers were excited about high-tech solutions in painting and interior design and were
eager to try. Upon satisfactory completion of their orders, customers started trusting
UrbanKare with all manner of repair and maintenance services. The firm strove to uphold
customers’ faith and the latter often complimented UrbanKare for flawless execution of their
orders. 2017 also saw the firm expand its operations to the districts of Bhagalpur and
Muzaffarpur in the state of Bihar, with a few B2B orders.
In March 2018, UrbanKare received its biggest order yet of $20,000: a building renovation
contract from a B2C customer, which involved interior decoration, modular kitchen, false
ceiling, and lighting, and took six months’ time to complete. Ever since, the firm had been
receiving orders of similar size and expanding its footprint to the rest of the state and
beyond (Exhibit 2). In 2018, UrbanKare took part in Mahila Udyog Mela, a state-level
exhibition of women entrepreneurs’ products, an excellent platform for promotion.
Participation in such a major event notwithstanding, awareness level of UrbanKare in late
2018 was still low.
In 2019, UrbanKare received a few orders from the government of Bihar that involved
beautification of the boundary walls of office buildings with Madhubani paintings [4],
followed by larger orders of similar nature. Orders from the business (B2B) market started
flowing in, too: one from OYO Rooms, a hospitality chain (for total renovation of a property,
including interior design of banquet hall) and another from HDFC Bank (for repair of air-
conditioners at a branch). Milestones in the firm’s journey are depicted in Exhibit 3. Revenue
kept rising exponentially and reached $94,500 in FY 2018–2019. In terms of customer
composition, business customers accounted for 71% of the revenue in 2018–2019, with the
rest coming from residential customers. Kumar reviewed the data and the characteristics of
and challenges involved in profitably targeting the B2B and B2C markets. He knew that the
B2C market represented a larger volume of transactions (orders) but revenue potential was
low as the average ticket size was far lower than that in the B2B market. Further, customer
acquisition in the B2C market was a challenge as customers tended to turn to the
neighborhood service provider out of habit. Retention was challenging, too, for loyalty in the
consumer market, in general, was weak. The B2B market, on the other hand, represented
larger average ticket size, although customer acquisition was far more challenging.
However, successful execution of an order was more likely to build loyalty, given the high
switching cost for the customer.

Maintenance industry in India: an overview and case context

Consumer preferences in India were changing rapidly, aided by the rising participation of
women in the workforce and the consequent jump in household incomes. The increasing
number of dual-income households brought with it an amazing opportunity for businesses:
provide the time-starved customers with app-based solutions for their service needs. The
latest industry to capitalize on this opportunity was the maintenance industry. Repair and
maintenance services were starting to go corporate. The trend of organizing or
corporatizing, this unorganized services sector was prompted by the anticipation of
increasing disposable incomes of India’s burgeoning middle class [5]. These on-demand
local services startups provided numerous services, including:
䊏 housekeeping services (plumbing, electrical jobs, carpentry, cleaning, pest control);
䊏 repair services (electronics, appliances);
䊏 building renovation services (structural maintenance, painting, and interior decoration);
and

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䊏 personal services (laundry; makeup and hairstyling; salon-at-home; home tutors;
music, yoga, and fitness classes at home; wedding planning and photography).

The first three categories listed above are common to both B2C and B2B markets. The on-
demand local services industry in India was growing rapidly with 69 startups founded in
2014 alone, a number that shot up to 150 in 2015 and 270 in 2017. Tracxn, a startup tracker,
estimated that this highly unorganized market held an opportunity ranging from $100bn to
$400bn.
The number of startups in this space rose dramatically since 2012 and most of them
targeted the B2C market. However, a majority of them had either been acquired by bigger
rivals or folded up, unable to raise funds and scale up quickly to be able to achieve
profitability in a fiercely competitive and low-margin business. The fragmented market,
witnessing a wave of consolidation, included the following major players, to name a few, in
early 2020: UrbanClap, HouseJoy, HomeTriangle and UrbanPro. UrbanClap, founded in
2014 and backed by SAIF Partners, among others, grew into India’s largest and fastest-
growing local services startup with an FY 2018–2019 gross revenue of $16.5m and an
operating loss of $9.7m. UrbanClap was renamed UrbanCompany in Jan. 2020 [6] and
currently had operations in India, Australia, Singapore and the UAE. As of January-end
2020, UrbanCompany had 25,000 trained professional service providers onboard across
the four countries and had served five million households. The firm worked closely with its
service partners and helped them with up-skilling, financing, insurance and product
procurement, effectively turning them into micro-service entrepreneurs.
HouseJoy was founded in 2015, was backed by Amazon, among others, and acquired a
number of smaller rivals including MyWash, a provider of on-demand laundry services
online. One of the earliest startups, Zimmber, acquired a couple of smaller rivals, including
FindYahan, between 2015 and 2016 – and, in turn, was acquired by the online classified
advertising platform Quickr in 2017 for $10m and was subsequently renamed QuickrEasy.
Another startup, Near.in, was acquired by Paytm, the mobile payment solutions provider
that subsequently branched out into e-commerce, in 2015 for $2m.
As per the latest census of 2011, India had a population of 1.2 billion, with 330 million
households. The decadal population growth rate (2001–2011) was 17.64%, which would
lead to a significant growth in the number of households, offering an opportunity to
organized, on-demand maintenance service providers [7]. The number of inquiries,
confirmed orders, and repeat orders rose steadily across platforms; the repeat purchase
volume as a share of the total order volume was estimated to be between 25% and 30%.
The number of inquiries received by UrbanKare per day is shown in Exhibit 4. With the
rapidly growing penetration of smartphones in India, demand was set to rise sharply [8]. As
the core customer value proposition of startups in this space was to provide quick and
reliable service, service partners played a pivotal role in the success of a firm, which was
essentially a marketplace that connected customers and service providers. It was thus
imperative for a marketplace to have an adequate number of carefully-screened,
background-checked, trained and skilled service providers onboard.

Urbankare business model

UrbanKare was a maintenance services marketplace: a two-sided aggregator that
connected a customer in need of a service with a background-checked, trained service
provider. The services targeted both B2C and B2B markets, where customers could order a
service either through the mobile app or through the website (www.urbankare.in). Services
offered included plumbing, electrical jobs, air-conditioner repair, painting, interior
decoration, modular kitchens, mural art and total building renovation. B2B market
contributed 71% to the firms’ total revenue in FY 2018–2019 with the B2C market accounting
for the rest. The business model canvas of UrbanKare is represented in Exhibit 5.

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 5

 Operating model
Kumar knew from day one that he was going to leverage IT capabilities and the reach of the
smartphone to its fullest. UrbanKare thus began with a mobile app and subsequently
launched its website to give potential customers an overview of the services available and
help them make an informed choice after comparing the advantages of the marketplace vis-
à-vis the neighborhood service providers they had always known. The firm was also listed
on JustDial, an online business directory, besides being available over telephone. A
potential customer could use any of the four channels to reach UrbanKare, choose a
service and place the order, by filling out a form (or providing over telephone) with his/her
personal details such as name, address, and contact number. A service provider would
then be assigned and his contact details along with the designated time slot shared with the
customer. The assigned service provider would contact the customer and execute the
order, to the extent possible, within 24 h of placing the order. This was achieved by picking
a service provider located within the shortest distance from the customer’s location. This
process is depicted in the service flowchart (Exhibit 6).
UrbanKare had over 300 verified and trained professional service providers onboard and
had served more than 5,000 customers until the end of 2019 [9]. The size of the service
partner base, given the current scale of operations, allowed the firm to meet exigencies
such as the unavailability of a service provider at a given point in time, by assigning the
second nearest provider to the customer location. This helped maintain customer
satisfaction levels. Kumar claimed that his firm executed 90% of customer orders within
24 h. In case of larger orders such as painting, interior decoration, or total building
renovation, UrbanKare ensured preliminary assessment of the requirements of the order on
site by a provider within the first 24 h and an estimate of the price and completion time
offered to the customer. The firm maintained a database of customer inquiries and orders to
be used as inputs in the development of marketing campaigns in future.

Revenue model
Customer orders were broadly of two types: standard and customized; UrbanKare’s pricing
varied with the type of order. For standard orders such as plumbing, electrical jobs or
appliance repair, a service fee was charged at standard rates based on the nature of the
task and a fixed ‘visit charge’ was added. The firm collected a flat 20% commission on the
order value after each successfully executed order while the rest went to the service
provider. Customized orders such as painting, interior design, modular kitchen and total
building renovation, on the other hand, were priced on a cost-plus pricing basis with a 25%
markup. For a customer, one of the major advantages offered by the on-demand
maintenance services marketplaces such as UrbanKare was standard, transparent and
consistent prices: providers in the unorganized market often charged arbitrary and
inconsistent prices, and even took advantage of peak demand (for instance, painting
during festivals) and jacked up prices dramatically.

Booking a service
To book a service, a customer had to visit the website (www.urbankare.in) or download the
mobile app available on Google Play store or visit the online business directory JustDial
(justdial.com) and look UrbanKare up. Alternatively, they could just telephone the firm.
Offering customers four channels to access the service was the norm in the industry. Once
on the website or app, a customer could check the rate card, select the required service,
and go through the terms and conditions of availing services. After booking a service, a
unique booking ID was generated. Multiple payment options were made available. Upon
successful execution of the order, they could offer feedback on the quality of service,
including the behavior of the service provider.

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Service delivery
The administrative interface of the mobile app updated booking records in real time. For
each order placed, all available service providers in the vicinity of the customer location at
the time were notified. Once a provider accepted the order, his details were shared with the
customer. The designated service provider then called up the customer, checked the
latter’s availability (or a family member’s availability in case of 2 C customers) at the service
site and used Google Maps/GPS, when required, to reach the customer’s location and
execute the order. All service providers carried identity cards issued by UrbanKare while
visiting customers as a means of identification and assurance to customers that they were
being served by verified and trained professionals.

Payment
Once a customer booked a service on the app/website, the fee payable was computed by
software and reflected on screen. Most of the payments were made using digital payment
modes including e-wallets such as Paytm [10] on the website and the app, while a few
customers preferred cash payment (Exhibit 7).

Service providers as partners

Repair and maintenance services industry in India being largely unorganized, independent
service providers such as painters, plumbers, electricians and repairmen, most of whom
had never received formal training, had traditionally had uncertain and irregular sources of
income. This scenario benefitted neither customers nor service providers. UrbanKare, a
marketplace founded with the objective of bringing reliability and order to an unorganized
market, set out to change the scenario by carefully screening, background-checking and
training service providers, thereby ensuring a regular source of income and respect to the
latter. Trained service providers served to reassure customers of quality service, which, in
turn, helped UrbanKare build both customer loyalty and provider loyalty, in a win-win-win
relationship for all three parties concerned. Service providers, thus, were essentially the
firm’s service partners. The firm also invested in continuous improvement of processes to
enhance the quality of service and cost competitiveness to create and deliver value for the
customer.

Marketing strategies
UrbanKare logo and the tagline
The logo of UrbanKare (Exhibit 8), with all its colours, symbolized vibrancy – characteristic
of the customers’ lives and the structures (homes and offices) they lived and worked in –
and, through the tool (the wrench in the lower half of the logo), also represented the nature
of services provided. The K in ‘Kare,’ which was sharp in the earlier version of the logo, had
been stylized to look like K, as well as C, both for clarity sake and as an assurance to
customers: we are here to take care of your buildings and keep them looking new. The
tagline, “Don’t worry, Kaam ho jaayega [11],” sought to reassure customers of certain,
timely and professional execution of their orders.

Digital marketing
UrbanKare relied primarily on digital channels and word of mouth for promotion: it used
Facebook, Instagram and YouTube as major media platforms to promote its services.
Search engine optimization was also used. The firm’s Facebook page had over 2,000
followers. Digital channels helped UrbanKare connect and engage with prospects and
customers. The founders believed that a satisfied customer was always their most powerful
brand ambassador [12].

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 7

 Offline marketing
The firm also used a few offline channels such as transit advertising (through banners on
public transport vehicles) and distribution of flyers inserted in daily newspapers. They had
also participated in Mahila Udyog Mela (an exhibition of women entrepreneurs’ products) at
Patna, to increase awareness among prospective customers. Advertising on FM radio
channels was used as it was cost-effective. Further, UrbanKare provided its service
partners with T-shirts bearing the firm’s logo, which served as a source of assurance to
customers, besides instilling a sense of pride among the providers.

Key differentiator
Internet-of-things-based projects and cloud-based design interventions
In 2017, the firm launched IoT-based interior decoration and cloud-based designing
interventions for their customers.
The IoT is a suite of technologies and applications that equip devices and locations to
generate all kinds of information – and to connect those devices and locations for instant
data analysis and, ideally, “smart” action. Conceptually, the IoT implies physical objects
being able to use the internet backbone to communicate data about their condition, position
or other attributes [13].
The IoT brought smart devices into homes and offices. As the market for interior design was
growing rapidly, the industry was also adopting IoT with terms such as “Iterior” (“IoT-based
Interiors”). UrbanKare disrupted the industry with IoT-based interior decoration and cloud-
based designing interventions. They provided trendy smart lighting systems to homes and
offices that were connected to mobile phones and tablets. UrbanKare aimed to make
homes and offices aesthetically appealing, relaxing and easier to use, with the help of IoT,
in which customers could turn on/off lights with Wi-Fi or an air-conditioner with a
smartphone.

Customer segments
Based on the nature of service required, UrbanKare divided its customers into two
segments, namely, individual consumers (B2C or consumer market) who booked services
for their homes and B2B customers such as business houses and government departments
that required major services like renovation and painting of the offices, AC repair and
maintenance of the whole office. Generally, B2C customers’ inquiries came through the
app, website and the business directory (JustDial), whereas business customers tended to
contact the firm via telephone with their inquiries and follow it up with a face-to-face
interaction to take it forward. Most of the B2B inquiries resulted from referrals by existing
customers who had availed a service recently. Word of mouth thus played a greater role in
lead generation in B2B sales.

Key challenges
Aggregation of independent providers: matching demand and supply
As a marketplace that connected customers and independent service providers,
UrbanKare faced the challenge of identifying, screening, background-checking, on-
boarding, training and retaining service providers, most of whom had never received a
decent education, let alone formal training. Coming as they did from an unorganized sector,
most of these providers needed a radical transformation to fit into the professional
environment of UrbanKare where responsiveness, punctuality, reliability, courtesy and
physical appearance (neat and tidy at work) were critical to success. Further, as the firm
was growing rapidly, it needed an ever expanding team of service partners. UrbanKare was

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also expanding beyond Patna into the rest of the state and the neighboring state of
Jharkhand.

Ensuring quality of service

A customer would choose and patronize, a marketplace such as UrbanKare only if the quality
of service was considerably superior to that of the unpredictable neighborhood provider –
and consistently so. It may be noted here that a marginal improvement in quality might not
serve as a strong enough incentive for the customers to break their habit and switch to an
‘unknown,’ however superior it might be. Additionally, as the image of the firm was
inextricably tied to the competence and behavior of the service providers-cum-partners – the
frontline staff – it was imperative to ensure consistently superior quality of service.

Customer retention
Another unique challenge facing UrbanKare – just as any other gig economy enterprise,
indeed – was retaining customers. A customer who had availed a plumbing service through
UrbanKare, for instance, would contact the same provider directly the next time, bypassing
the firm. Providers tended to oblige, and even encourage, such requests in a bid to pocket
the 20% commission that would otherwise go to the marketplace.

Building awareness
Despite radio and transit advertising, below-the-line activities such as participating in an
exhibition of women entrepreneurs’ products and an active digital media presence
(Facebook, Instagram, YouTube and Google search), brand awareness was quite low. The
firm needed to boost awareness significantly, and quickly, if it were to capitalize on the
opportunity presented by the near absence of established players in this part of the country
(major players such as UrbanCompany were active in the larger cities of Delhi, Mumbai,
Bangalore, etc.), and build on the initial momentum, before setting sights on the larger cities
and eventually emerge as a national player.

Boosting app usage

A total of four channels were provided through which customers could reach UrbanKare –
website, app, telephone and JustDial, the third party business directory – but the former
mostly used telephone and JustDial, with the app being the least used channel. Ironic as it
might sound, customers did not seem excited about the app, not because of a poor
interface, but because the literacy rate in Bihar was 38% and internet penetration, 25% [14].
The telephone channel meant additional manpower requirement. Kumar believed that he
needed to find a way to boost the adoption of the app as its beautiful and functional
interface – virtual servicescape – would help enhance customer experience and foster
brand loyalty, in addition to making his investment in the app development worthwhile.

Urbankare 2.0
The marketplace that began with a few mundane services in its portfolio – the services of
plumbers, electricians, and (air-conditioner) repairmen – had come a long way, with
innovative services such as mechanized painting and IoT-based interior designing. Being a
pioneer in the aggregation of maintenance service providers, at least in this part of the
country (the eastern states of Bihar and Jharkhand) – and an early adopter of technology,
UrbanKare was certainly a disruptor. Buoyed by the early success resulting from the
adoption of these technologies, Kumar was ambitious and determined to propel his startup
into the high-growth path.

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 9

 Business dilemma
As he looked back at the journey in the year 2020, Kumar knew he had done well for a first-
generation entrepreneur operating against the odds in transforming an unorganized market.
However, he was faced with a dilemma with regard to the choice of target market as he
visualized the next phase of growth and geographic expansion of UrbanKare into other
states. Which of the two markets – B2C and B2B – would help realize his vision of a
technology-driven marketplace with a broader geographic footprint beyond Patna and the
state of Bihar?
The consumer and business markets had their own unique dynamics – customer needs and
pain points, skilling of human resources, unit economics, payment cycles, business
approach, project planning, management and firm capabilities required for success.
The firm had already started executing major B2B orders such as total renovation of
office buildings, annual air-conditioner maintenance contracts, etc. Orders from the
business market, although few and far between, had a higher average ticket size
($325); and referrals by existing customers proved more effective in acquiring new
ones.
When Kumar looked back its firm resources gathered in past five years of business
operation, he was very comfortable with the way the company has grown up. They had best
of the management professional who can negotiable and win business tenders from large
companies, vast business network and supply chain for economical procurements and
qualified team of project managers (3) to complete the projects on time. This gives
confidence to him for B2B business expansion and establishments. Although, as most of
the B2B orders are from government firms and corporations, they face issues in terms of
delayed and part payment.
The other alternative was the consumer market, characterized by a higher frequency of
orders, albeit with a smaller average order size ($9.5), that required a larger service
partner base (than the current level of 300, 10% increment each year). To add to that,
providers often accepted customer orders in an individual capacity (over their personal
telephone numbers), bypassing the firm, which resulted in loss of customers and
revenues.
Kumar, an engineer by profession and manager by training was aware that with passing
time, company need to create a strong moat to safeguard its business interest in turbulent
times. Seven of his employees have already left his company to form their competing
business enterprise. All consumer business witness the same sooner or later and
UrbanKare is no exception.
However, the B2C market presented UrbanKare with an emerging opportunity in the form of
a nascent market for “smart homes.” The growing demand for technology-driven interior
design and IoT-based smart homes with connected furnishing was a tantalizing opportunity
to tap into, especially given the firm’s initial success in providing such smart solutions. The
smart homes market in India was growing steadily, registering a year-on-year growth rate of
30% in 2017 [15].
Kumar needed to make a decision before the next board meeting scheduled February
2020, one that would determine the future of his young startup. He said:
The market for on-demand repair and maintenance services in India has been growing rapidly,
disrupting the unorganized market. It has also witnessed a wave of consolidation, but most
major players have so far restricted themselves to the major metropolitan cities, with virtually
none operating in the eastern states of Bihar and Jharkhand, where we have been a pioneer and
trailblazer, offering smart solutions, in addition to the regular ones. Now we find ourselves at a
crossroads as we seek to expand our footprint and emerge as a national player, with a clear
competitive advantage. Should we follow a mix strategy or go with the wind. Do we need

PAGE 10 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 10 NO. 4 2020

 corrective measures in our long-term business strategy by focusing more on business market
than consumer markets? One of the similar startups headed by my friend was acquired by Keywords:
Australian firm at premium price. Should I follow the same if given a chance? I am totally Business formation/start-
confused that what to do? My team and management are looking at me for my directions. What ups, B2B marketing,
should I suggest to the board? Which of the two markets should UrbanKare target to sustain its Service management,
business? Customer service

Notes
1. The apex body of women entrepreneurs in India.
2. US$1 = ‘74.07 (as on Mar. 17, 2020).
3. https://rbi.org.in/scripts/BS_PressREleaseDisplay.aspx?prid=27047
4. An Indian art form.
5. Vidya Padmanabhan, “Home maintenance goes corporate,” www.livemint.com/Companies/vUFt6o
N7WB26hqnH9ccPyO/Home-maintenance-goes-corporate.html, 6th February 2012.
6. “UrbanClap rebrands itself as Urban Company,” https://economictimes.indiatimes.com/small-biz/
startups/newsbuzz/urbanclap-rebrands-itself-as-urban-company/articleshow/73767776.cms, 30th
January 2020.
7. http://censusindia.gov.in/2011-prov-results/data_files/india/paper_contentsetc.pdf
8. Team INC 42, “The Indian Home Services Startups Are Killing It – Decoding The $100 Bn
Opportunity,” https://inc42.com/buzz/decoding-100-billion-home-services-marketplaces/ 6th
August 2015.
9. Company sources.
10. An Indian mobile payment services provider.
11. Translation: “(Don’t worry), consider it done.”
12. Company sources
13. “The IoT: A technical primer,” www2.deloitte.com/insights/us/en/focus/internet-of-things/technical-
primer.html?icid=dcom_promo_featuredjus;en, 8th February 2018.
14. “Internet users to reach 627 million by end of 2019: Kantar IMRB report,” www.afaqs.com/news/
story/54591_Internet-users-to-reach-627-million-by-end-of-2019-Kantar-IMRB-report
15. “Smart Home Market in India growing steadily,” www.mobilityindia.com/smart-home-market-in-
india-growing-steadily/, 27th July 2017.
16. “UrbanClap rebrands itself as Urban Company,” https://economictimes.indiatimes.com/small-biz/
startups/newsbuzz/urbanclap-rebrands-itself-as-urban-company/articleshow/73767776.cms, 30th
January 2020.

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 11

 Exhibit 1. Financial performance of UrbanKare (in $)

Table E1
Particulars 2016–2017 2017–2018 2018–2019

Revenue 5,535.30 26,957.57 94,543.49

Expenses 6405.32 27,175.60 102,477.35
Profit/(Loss) (870.02) (218.03) 7,933.86
Source: Company sources

Exhibit 2. Geographical expansion of UrbanKare

Figure E1

PAGE 12 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 10 NO. 4 2020

Exhibit 3. Milestones achieved by the company

Figure E2

Exhibit 4. Average number of queries generated at UrbanKare (per day)

Table E2
Type of channel & cost Lead (B2C) Lead (B2B)

Website 65 5
UrbanKare app 9 0
Personal relations 5 0
BTL advertisement 7 0
Word of mouth 6 0
Just dial 30 3
Total 122 8
Source: Company sources (updated as on January 2020)

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 13

 Exhibit 5. UrbanKare business model canvas

Figure E3

Exhibit 6. Service flow chart

Figure E4

PAGE 14 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 10 NO. 4 2020

Exhibit 7. Payment flow chart

Figure E5

Exhibit 8. UrbanKare logo and tagline

Figure E6

About the authors

Prof Rajeev Verma is an alumnus of prestigious Indian Institute of Management Indore and
have taught marketing courses in various places such as Mexico, Dubai and India. He is
expertise is Service Innovation, Startup Incubation and Business Data Processing. Rajeev
Verma is the corresponding author and can be contacted at: rajeevsuccess@gmail.com

Prof G.K. Murthy Kothapalli is an academician par excellence and having more than 15
years of experience in teaching courses ranging from Retail Management to Branding and
consumer behavior.

Ms Ranjini Kumari is an academic scholar currently pursuing PhD in the area of Marketing
Management. She is a UGC NET qualified research scholar and having rich experience of
writing academic cases.

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 15

 Teaching notes
Rajeev Verma, G.K. Murthy Kothapalli and Ranjani Kumari

Synopsis
Consumer preferences in India were changing rapidly, aided by the rising participation of
women in the workforce and the consequent jump in household incomes. As the
socioeconomic status of households were increasing, families were becoming dual income
wherein both male and female partners used to contribute into the economic activities. With
this, they generally did not have time to manage their household repair and maintenance
works. Some assistance was required to maintain their household works such as repair,
maintenance and cleaning of the homes. This proved the old saying by John Ray, “where
there’s muck there’s money.” The latest industry to capitalize on this opportunity was the
maintenance industry. Repair and maintenance services were starting to go corporate. The
trends in organizing or corporatizing this unorganized services sector was prompted by
the anticipation of increasing disposable incomes of India’s burgeoning middle class.
The on-demand local (maintenance) services industry in India was growing rapidly with 69
startups founded in 2014 alone, a number that shot up to 150 in 2015 and 270 in 2017.
Tracxn, a startup tracker, estimated that this highly unorganized market held an opportunity
ranging from $100bn to $400bn. These service providers were providing safe, reliable
services with complete professionalism and competitive pricing with the unorganized
service provider. Along with this the smart homes decoration demand was also growing
very rapidly, in 2019 only the revenue generated through smart homes was US $1,691. And
it was expected to grow at the rate of 43.6% CAGR, while average revenue per installed
Smart Homes was US$58.18. This indicates future potential of this growing sector.
The number of startups in this space rose dramatically since 2012 and most of them
targeted the B2C market. However, a majority of them had either been acquired by bigger
rivals or folded up, unable to raise funds and scale up quickly to be able to achieve
profitability in a fiercely competitive and low-margin business. The fragmented market,
witnessing a wave of consolidation, included the following major players, to name a few, in
early 2020: UrbanClap, HouseJoy, HomeTriangle and UrbanPro. UrbanClap, founded in
2014 and backed by SAIF Partners, among others, grew into India’s largest and fastest-
growing local services startup with an FY 2018–2019 gross revenue of $16.5m and an
operating loss of $9.7m. UrbanClap was renamed UrbanCompany in Jan. 2020 [16] and
currently had operations in India, Australia, Singapore and the UAE. As of January-end
2020, UrbanCompany had 25,000 trained professional service providers onboard across
the four countries and had served five million households. The firm worked closely with its
service partners and helped them with up-skilling, financing, insurance and product
procurement, effectively turning them into micro-service entrepreneurs.
The present case is about the entrepreneurial journey of Miss Swati Anand and Mr
Balkishun Kumar, founder of UrbanKare Internet Pvt. Ltd. a maintenance service
aggregator, which initially started their maintenance service business by organizing the
service solutions from local market and training them to make them professional and
reliable. Initially, they started with the jobs such as plumbing, repairing and maintenance of
ACs and electrician works. Although, being from engineering background both of the
founders had strong inclination toward applying IT and other network technologies into the
business. Mr Balkishun wanted to mechanize and automate household painting and interior
works. They launched their own app, website and used mechanism such as SEO and other
IT technology to expand their business. In 2017, they also started providing IoT-based
home decoration services. They provided maintenance services which can be booked
using website, by calling at the company’s call center or by the login into the app. They
were also working very well with the B2B market such as government offices and other
private organizations. To share, company was using only BTL promotion medium such as
participating in fairs, digital marketing with Facebook, SEO, Instagram, website and
android app. They also used methods like distributing pamphlet, road shows and word-of-
mouth publicity for advertising their business.
The founders were in dilemma whether they should move completely into the B2B customer
segment (large token size, small volume) or they should be still working with the small
maintenance works with which they started with the B2C segment (small token size, large
volume). They were facing the issues like how they should be managing the growth while

PAGE 16 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 10 NO. 4 2020

maintaining its quality and human resources, their skill enhancement, unmet demand,
retaining existing customer and increasing no of customers with efficient use of existing
resources. Is there any moat strategy that may work for their business?

Learning objectives
This case offers different avenues for overall learning, which can be discussed with
students in detail to have a comprehensive understanding of entrepreneurship and new
evolving trends in the market:
䊏 To understand drivers of changing customer preferences that leads to the evolution of
innovative business models.
䊏 To describe the network aggregator business model for service provision, highlight its
unique features and make students understand the role of automation in the
maintenance industry.
䊏 To describe the key challenges and opportunities associated with B2B and B2C
business models.
䊏 To analyze B2B and B2C business models with reference to the resource capabilities of
the firm.
䊏 To differentiate stakeholders’ skills and business capabilities required in B2B vs B2C
business models.

Position in the course

This case may be useful to under-graduate and postgraduate management students to
highlight the concept of B2B and B2C business models and its adoption in the context of
strategic positioning of the firm. Case highlights business dilemma faced by first-generation
entrepreneurs to adopt business markets in line with their strategic firm resources. In the
context of emerging business models, it highlights aggregator-based network e-platform
business offerings in emerging markets. These e-platform based models are unique in
terms of their dependency on IT/ITeS and creation of economic moat. In the other hand, it
highlights the challenges and issues faced by first-generation entrepreneurs in terms of
business experience. Further, this case can also be offered in executive MBA courses,
wherein middle and senior-level executives could understand how identification of business
opportunities in line with firm resource capabilities leads to moat creation.

Research methodology
This case study is fairly exhaustive and comprehensive study of the subjected organization
“UrbanKare Internet Pvt. Ltd,” wherein detailed and complete observation of the
protagonist, as well as their contextual and situational surrounding has been documented.
The research questions of the case study are directly linked with the real-world problem
faced by the protagonist. The author has carefully framed all research questions after an
extensive literature review to ensure that these questions are clearly formulated, narrow and
researchable.
The authors have made all the efforts to collect primary data using preliminary intensive
investigation techniques. Direct interviews have been recorded with the founders of the
enterprise and the customers (with random and snowball sample) and non-customers of
the services. To avoid the issue of observer bias, the authors have analyzed the research
questions at different levels of analysis (firm and individual). Finally, generalizations and
inferences are drawn after establishing relationships between the case study objectives
and case study research questions.

Teaching plan
The case has been designed to be discussed in 75–90 min session in the class, and the
discussion should be divided into different topics, as presented below. The order in which
these topics have been arranged is just suggestive and the instructor may follow and order
of sequence as per their own interest. The instructor may frame questions in a manner to
cover the majority of the case topics while ensuring a smooth transition from one block to
next (Table 1):

VOL. 10 NO. 4 2020 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 17

 Table 1 Topics covered and session time breakup
No. Topic Time (in minutes)

1. Introduction to maintenance service sector evolution in India, with 10

discussion on opportunities coming up with this sector
2. Discussion of app based two side aggregator business models 15
prevailing in Indian Market
3. Company overview and business model of UrbanKare 05
4. Discussion on Key differentiator of the organization 10
5. Discussion on challenges being faced by the organization in terms 10
of aggregator business model and highlighting network effect
6. Discussion on future action plan for the company regarding B2B or 15
B2C dilemma
7. Conclusion 10

Relevant readings
The following suggested readings (text and research papers) on aggregator-based
business model, IoT and IT-based businesses, B2B and B2C business comparison,
managing customer relationships.

Text books
1. Zeithaml, V., Bitner, M., & Gremler, D. (2009). Services Marketing: Integrating
Customer Focus across the Firm, 5th ed.., McGraw-Hill Irwin.
2. Hutt, & Speh, Latest (Ed.), Business Marketing Management: B2B, Cengage
Publishing.

Research articles

3. Saha, S. K., Aman, A., Hossain, M.S., Islam, A., & Sarder Rodela, R. (2014). A
Comparative Study on B2B vs. B2C Based on Asia Pacific Region, International
Journal of Scientific & Technology Research, 3(9), ISSN 2277-8616.
4. Alstyne, M., Van, W., Parker, G.G., & Choudary, S.P. (2016), Pipelines, platforms,
and the new rules of strategy, April Issue, Harvard Business Review.
5. . Zhu, F., & Iansiti, M. (2019), Why some platforms thrive and other don’t, Harvard
Business Review.
6. Iankova, S., Davies, I., Archer-Brown, C., Marder, B., & Yau, A. (2018). A
Comparison of Social Media Marketing between B2B, B2C and Mixed Business
Models//Industrial Marketing Management, doi: 10.1016/j. indmarman.2018.01.001.
7. Boksberger, P.E., & Melsen, L. (2011). Perceived Value: A Critical Examination of
Definitions, Concepts and Measures for the Service Industry, Journal of Services
Marketing, 25(3). 229–240.
8. Corsaro, D., Ramos, C., & Henneberg, S. C. (2012). The Impact of Network
Configurations on Value Constellations in Business Markets—The Case of an
Innovation Network, Industrial Marketing Management, 41(1), 54–67.
9. Menon, A., Homburg, C., Beutin, N. (2005) ‘Understanding Customer Value in
Business-to-Business Relationships’, Journal of Business-to-Business Marketing 12
(2): 1–35.
10. Mencarelli, R., & Rivière, A. (2014). Perceived value in B2B and B2C: A comparative
approach and cross-fertilization. Marketing Theory, Retrieved from: https://doi.org/
10.1177/1470593114552581

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