Woovly looks to woo investors as it achieves CM2 metric

NEW DELHI/BANGALORE: Woovly, a social commerce platform for Tier 2 and Tier 3 millennials, driven by a creator community has announced that it has turned CM2 positive.

Contribution Margin (CM) which indicates the aggregate amount of revenue available after variable costs to cover fixed expenses and provide profit to the company, is a metric for future profitability.

According to the company no ecommerce or social commerce company in India has achieved a positive CM2 level as quickly. CM is further broken down into CM1, CM2 and CM3. Woovly was already a CM1 positive company and given that its variable costs are quite low, it turned into a net positive CM2 level.


The founder duo of J Venkat and Neha Suyal attribute their CM to their strategy of organic user acquisition driven by user generated content creation. Woovly’s cost of acquiring customers is almost negligible owing to these measures.

CM is the foundation for break-even analysis and is a crucial yardstick for investors. Also, while other ecommerce companies have high fulfilment costs, Woovly claims it has hardly any. In a statement, Venkat said, “There are a lot more corrections happening in the social/ecommerce space than any other in the startup space, especially in terms of reducing the burn on acquisition, retention, and fulfilment. This is where our overall strategy is proving to be a winner.”


A lifestyle social commerce platform for Indian millennials, Woovly, aims help the growth of video commerce in India. A major chunk of their revenue is from the micro and nano influencers. The company claims short video content creators have their set of followers and when they create brand tagged content, their community watches and wishlists products. They go on to watch more related and similar videos and ultimately buy the products by clicking on the tags. Each creator earns money for every transaction that originates from video content on the platform. The cost therefore, is indirect and is aligned to Woovly’s earnings.