Launched in 2007, BookMyShow, an online movie & entertainment ticketing platform, remained an undisputed leader for a decade until mobile payments platform Paytm entered the segment.
In March 2016, Paytm announced a partnership with PVR Cinemas bringing movie tickets to its platform as a part of its nationwide foray in the online movie ticket segment.
Paytm was then simply extending its presence in new verticals to become a part of the daily life of its customers. However, the move was set to give a bigger jolt to BookMyShow which was the only player and a leader in the segment.
Meanwhile, when two major players fight for marketshare, both tend to lose capital. The rivalry between the two is expensive as Paytm and BookMyShow have been bleeding.
In the fiscal year 2017, BookMyShow reported a 27 per cent increase in operational revenues at Rs 300.6 crore compared to Rs 236 crore in FY16, according to RoC filings.
The company’s online ticket booking service, however, accounted at Rs 230 crore in FY17 from Rs 176.7 crore, in the year-ago period, registering a 30 per cent growth.
At a first glance, the numbers may give an impression of high growth, but is far less than the growth observed between FY16 and FY15. BookMyShow reported a revenue of Rs 236 crore for 2015-16, registering a growth of nearly 85 per cent from Rs 127.6 crore in the previous year.
Importantly, the company registered almost a double growth before Paytm forayed into the segment.
In April 2017, a year after the launch of movie ticketing category, mobile payments platform claimed to have sold 25 million tickets and crossed gross merchandise value of Rs 400 crore.
Early this year, it claimed it sold over 52 million movie and event tickets in 2017 which is 100 percent growth as compared with 2016.
The launch and early growth of Paytm’s movie & entertainment segment were alarming for the market leader Bookmyshow, which didn’t witness any near competition.
BookMyShow revisiting biz strategy
Sensing the rising competition from the new entrant Paytm, the online entertainment ticketing leader had begun pumping in investments in advertising and other areas in 2016 itself.
In FY17, it witnessed its expenses almost doubling to Rs 473 crore from Rs 248 crore driven by an almost 4 times increase in advertising expenses to Rs 146.5 crore as compared to Rs 30 crore in FY16.
This has pushed up losses by a whopping 138 times to come in at Rs 139 crore as compared to a net loss of Rs 1 crore in FY16.
In FY18, BookMyShow has been exploring various business deals to remain relevant in the market.
Late last year, according to media reports, Flipkart was in talks with BookMyShow for a strategic partnership to build out its services and transaction offering against Paytm.
In November last year, it partnered with PVR Pictures for ’Vkaao’, a web-platform that allows individuals to choose films they want to watch at their local PVR cinemas.
Early this year, there were reports it was in advanced discussions with private equity firm TPG Growth to raise around $50-60 million (Rs 320-380 crore) funds.
Paytm bets big on movie tickets
The Vijay Shekhar Sharma-led company is eyeing to sell 100 million tickets in 2018.
The company also plans to collaborate with production houses for offering customised analytics and marketing solutions.
In June last year Paytm had acquired a majority stake in online ticketing platform, Insider.in. Notably, Paytm backer Alibaba had picked-up a majority stake in Chennai-based online ticketing platform TicketNew through its affiliate Alibaba Pictures in June last year.
Currently, the movie ticketing market in India is estimated to be worth nearly $2 billion and has been growing at 10 per cent annually. So far, the online movie ticketing market is only 15 per cent of the overall domestic market.
Paytm has identified movie ticketing as the next $1 billion gross transactions vertical, besides travel.
The news was first reported by ET.