Social commerce app Simsim will stop taking orders post March 31, 2023
However, YouTube said it will continue to work with creators to introduce new monetisation opportunities
YouTube acquired the Indian startup at a reported valuation of $70 Mn in 2021
Marred by layoffs and a cost-cutting exercise at parent Google, streaming major YouTube on Thursday (March 23) said that it is shutting down its live social commerce app Simsim.
The development comes two years after the Google-owned streaming giant acquired the Indian startup at a reported valuation of $70 Mn.
The Economic Times was the first to report the latest development, saying that Simsim will stop taking orders post March 31.
Even as it winds up the operations of Simsim, YouTube looks keen on scaling its social commerce vertical. In a statement, YouTube said it will continue to work with creators to introduce new monetisation opportunities and is committed towards supporting creators’ businesses.
“As we discontinue the Simsim app, we’ll be working with creators to introduce more monetisation opportunities for creators through an affiliate program and more shopping features across long-form videos, Shorts and livestreams on YouTube in 2023,” a YouTube spokesperson said.
Founded in 2019 by Saurabh Vashishtha, Amit Bagaria, and Kunal Suri, Simsim operated at the intersection of customers, social media celebs and local businesses. The platform allowed creators to directly market products from local businesses and sell them online to customers browsing through its app.
At the time of Simsim’s acquisition in 2021, YouTube said it was looking to enable Indian small businesses reach new customers through the deal. However, the transaction appears to not have panned out the way the streaming giant hoped for.
The Social Commerce Wasteland
The move to shut Simsim comes close on the heels of the social commerce platform reporting a loss of INR 157.25 Cr against a meagre revenue of INR 18.21 Cr in the financial year 2021-22 (FY22).
The mounting loss appears to have triggered the downfall of the platform which was once considered a big player in the social commerce space. Simsim appears to have been bogged down by the same set of challenges that have plagued other giants such as Flipkart, Myntra, Amazon, Nykaa in the social commerce space.
Most of these players operate on heavy losses while their social commerce verticals have not exactly scaled up in terms of revenue and other key operational parameters.
Earlier this year, VC firm Sequoia exited the troubled Indian social commerce startup Trell with a loss of 78% amid allegations of financial irregularity at the company.
Besides, the social and live commerce verticals of many of the short video apps have also not scaled up and have more or less turned out to be dud.
Despite this, India’s social commerce space continues to see traction in terms of acquisitions and investments.
Days ago, the Good Glamm Group acquired social commerce startup Bulbul, while Amazon acquired local social commerce startup GlowRoad last year. The US-based ecommerce giant also debuted its live commerce service in India in October 2022.