Blend products into services for the long haul – Crypto News

The new playbook

Home-services platform Urban Company, which made a stellar stock-market debut on 17 September, is seeing measurable traction for its home-solutions brand Native, which contributed about ₹75 crore, or roughly 11%, to its revenue of ₹380 crore for the September quarter. The products business has expanded fourfold from ₹29 crore in 2023-24 to ₹116 crore in 2024-25.

The company, which has also started selling its water purifiers and smart electronic door locks on other e-commerce sites, sees this business improving its operating margins and helping it move towards profitability.

The goal is to “remain connected with the customer both digitally through the app, and physically through our service network” to build long-term relationships, said Abhiraj Singh Bhal, Urban Company’s chief executive, during the second-quarter earnings call.

Bhal clarified that water purifiers address a “big gap in the market”, where subscription-led adoption is proving effective—a model, Mint reported on 26 June, its rival Livpure is also pursuing. Smart door locks, while still a niche category, have “significant headroom” and are expected to gain momentum as the market matures, he said.

While Bhal said the company plans to “increase the breadth of products in the same categories,” it is also planning to enter new categories, such as the air-conditioning space, according to two people familiar with its plans.

The company remains loss-making at an adjusted Ebidta level.

Mint queries sent to Urban Company on Monday remained unanswered until publication.

MyGate is trying a similar tack. The gated-community security platform, backed by around $83.3 million from Tiger Global and Tencent, launched its smart door locks in October and is already preparing to expand beyond locks into adjacent categories such as security cameras and home-automation devices.

However, it is “several months away from launching another product”, said Abhishek Kumar, co-founder and CEO.

Kumar did not disclose revenue contribution or unit sales, saying the product business is still “too nascent” to comment on. The buying experience is embedded within the app itself, and the company is now looking to build out a business-to-business channel by partnering with builders and developers to cross-sell locks as part of their housing offerings.

HealthifyMe, which initially sold smart scales and continuous glucose monitors (CGM) only as a subscription, has also listed its products on e-commerce channels.

The wellness and nutrition platform, which has raised around $145 million from investors including Khosla Ventures, LeapFrog Investments and Sistema Asia Capital, has sold about 300,000 smart scales and 50,000 CGMs across its app, where it has 40 million users, and through e-commerce channels since late last year, when it began offering the devices outside subscription bundles.

“The biggest thing hardware adds is the ability to track data—passively, continuously, and beyond what an app alone can capture,” said CEO Tushar Vashisht, adding that cheaper hardware and better AI now make richer data streams possible without much user input.

He noted that 20-30% of the business now comes from outside the app, but the company does not plan to expand into parallel categories such as smart bands or rings, since it already partners with most wearable-tech makers.

Paytm is also squeezing more out of its ubiquitous soundbox. The financial-services company is working to monetize AI-enabled soundboxes through “subscription and inference fees”, charging merchants for analytical and operational support services built into the device, said founder and CEO Vijay Shekhar Sharma, during the September-quarter earnings call.

The idea is to morph the soundbox from a simple payment alert machine into an AI-driven assistant. Sharma described it as a growing “revenue line item” rather than just a cost-efficiency tool.

The soundbox sits at the heart of Paytm’s merchant strategy. As of September 2025, the company had 13.7 million merchant device subscriptions, up 2.5 million from a year ago, making it one of the largest installed hardware bases in India’s fintech sector.

Each device acts as an anchor for Paytm’s merchant relationships—a first point of contact that helps it cross-sell loans, insurance, and marketing products while generating steady monthly subscription income.

The company’s payment-related revenue, which includes device fees and transaction processing margins, rose 25% year-on-year to ₹1,223 crore in the second quarter.

Mint queries sent to Paytm on Monday remained unanswered until publication.

A long way to go

Most platforms aren’t building these products in-house, largely relying on existing manufacturers and OEM partnerships—an asset-light approach. Only Paytm soundboxes are designed and manufactured at its Noida facility.

Besides, these platforms are largely positioning their products at the premium end of the market. Urban Company’s native RO purifiers range from ₹12,000 to ₹19,000—significantly higher than mass-market brands such as Kent or Eureka Forbes, which typically start at around ₹5,000.

Its smart locks hover around ₹17,000. In comparison, Hero Group-backed Qubo, Godrej, and Atomberg have priced their products below ₹15,000. MyGate sells locks priced between ₹9,000 and ₹30,000, with an average selling price of about ₹12,000.

HealthifyMe’s smart scale starts at ₹2,500—priced significantly lower than Cult’s ₹8,000 but far above no-frills scales available on e-commerce platforms, which can be purchased for as low as ₹500.

In the fintech space, a standard soundbox is usually free or comes with an upfront cost of ₹200-300, but carries a monthly rental of ₹125-150 for Paytm and ₹1-49 for PhonePe. Paytm’s Card Soundbox starts at ₹999 with a monthly fee and supports tap-to-pay up to ₹5,000, while a basic point-of-sale (PoS) device costs about ₹2,000. Pine Labs’ Mini, positioned between a soundbox and PoS, is priced at ₹1,999 plus a usage-linked subscription.

“People already comfortable with digital payments, connected devices, and app ecosystems” are the target audience for these players, as “that is where the data monetization is the strongest and where subscription or service bundling makes financial sense”, said Sameer Jain, managing director at management consulting firm Primus Partners.

Over time, the companies might consider mass-market adoption, but “product-led models are still expensive to scale”, he added. Therefore, the initial approach would be to refine the experience with smaller, high-value segments.

Yet, legacy players still have their time in the sun, as newer players “don’t have decades of experience in product durability, supply chains, or after-sales service”. Add to that, “hardware is messy, with logistics, maintenance, and customer support costs that can eat into margins… and will have to learn operational discipline” from the traditional players, he added.

“They are not chasing profit on the device itself. It’s a gateway to recurring revenue,” Jain added.

Bridging the gap

For these platforms, the product push is ultimately about expanding the total addressable market. “It allows them [companies] to capture a much bigger wallet than subscription or service fees. It also creates stickiness and top-of-mind recall in categories where purchase frequency is low,” said Madhur Singhal, managing partner for consumer and internet at management consulting firm Praxis Global Alliance.

However, while products can be profitable on their own, many tech brands lack deep offline distribution, making bundling particularly effective in bridging that gap, he added.

He cautioned that products alone are not yet meaningfully improving overall unit economics for these companies. “Today, these products are enabling stickiness and repeat usage, which indirectly supports the economics of the business. Service-attach models haven’t stabilized yet, but adoption is growing. For instance, many higher-end mobiles and electronics now see maintenance and protection plans cross-sold to consumers.”