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IKEA is a consumer brand that anyone can relate to; it's homely, practical and futuristic which makes it very exciting for India because these are the values that compel us before purchasing anyway. 
 
So, when we heard that IKEA is opening its first store in the country next year, not only were we excited, but extremely curious as well. <keyword id="824043" type="COMPANY" weightage="20" keywordseo="Business-Insider">Business Insider</keyword> met with <keyword id="3922141" type="UNKNOWN" weightage="20" keywordseo="mikael-palmqvist">Mikael Palmqvist</keyword>, APAC Head, IKEA Retail to discuss what’s in store, (literally) at the upcoming IKEA store in Hyderabad. 
 
This is how he began - “We are very excited to open our maiden store in the country after textile- sourcing for about 30 years from here. The size of the store, the functionality of the products would be same, and around 5% of the products will be Indianized for meeting customer’s needs like the ‘tava’, idli maker and the pressure cooker.” 
 
Regulations 
 <keyword id="3922143" type="UNKNOWN" weightage="20" keywordseo="palmqvist">Palmqvist</keyword> emphasizes that IKEA is not a retail company, but a life-at-home company that sells solutions. For him, India is a very important market because not only is every home, room, and activity important, but the sheer size and diversity makes India like a continent for the company. 
 
Palmqvist also says that it took them around 4.5 years to get here but that wasn’t because of the regulations. 
 
He says - ‘’Our stakeholders here have always been supportive; in terms of FDI, e-commerce, and sourcing. Ease of doing business has increased dramatically.’’ 
 
‘Start and adapt’ is IKEA’s motto of the company everywhere, and in India as well. 
 
“We want to understand how the customer accepts IKEA and then go from there. If the customer wants to pay digitally or by cash, we will provide them with options’’ he adds on being asked to comment on the recent demonetization move and its impact on businesses. 
 
Diversity 
 The company also believes in emphasizing on diversity when they hire people and globally they ensure that 50% of the workforce is women. Currently, the company has collaboration with <keyword id="3922144" type="UNKNOWN" weightage="20" keywordseo="national-institution-of-fashion-technology">National Institution of Fashion Technology</keyword> which contributes design aesthetics to their collections. 
 
In terms of future pricing for their products, they claim to be accessible to all, and not just the middle class. They want to be competitive in pricing under ‘’Home furnishing for all’’. 
 
Online store 
 
E-commerce companies like HomeLane, Urbanladder, Pepperfry, Fabfurnish etc. might pose a threat to the Swedish giant, but Palmqvist’response - ‘’We are happy to build up the furnishing market with these players“ – shows the IKEA team is unfazed by the competition. 
 
Their website IKEA.in will be updated with inventory after the store has opened in full swing. 
 
<a href="http://www.businessinsider.in/Bollywood-actor-Kunal-Kapoor-talks-about-Ketto-his-crowdfunding-startup-which-has-raised-Rs-40-Cr-for-social-causes/articleshow/55753955.cms">ALSO READ: EXCLUSIVE - Bollywood actor Kunal Kapoor talks about Ketto, his crowdfunding startup which has raised Rs 40 Cr for social causes</a> 
 
<a href="http://www.businessinsider.in/This-LinkedIn-survey-reveals-that-India-has-the-highest-level-of-sales-and-marketing-collaborations/articleshow/55749887.cms">Feeling inspired by the Indian homes</a> that the IKEA team visited, the company plans to make further investments in the country but over a few years, after more stores have opened. After Hyderabad, the company wants to open in <keyword id="57321" type="PERSON" weightage="20" keywordseo="Navi-Mumbai">Navi Mumbai</keyword> and so on. 
 
Biggest cafes 
 When we asked <keyword id="322364" type="PERSON" weightage="20" keywordseo="Mikael">Mikael</keyword> to tell us how would an Indian feel after entering the first IKEA store, he said, “WOW! I want them to be surprised by how much we know about what they need. It’s smart and affordable.” The company is also planning to open the biggest restaurants in India with 1000 seats, where customers will get to taste typical Swedish delights. 
 
The company seems to<a href="http://www.businessinsider.in/EXCLUSIVE-BigBaskets-co-founder-talks-about-hyperlocal-businesses-and-profitability/articleshow/55752379.cms"> be watching how you live, eat and work to create things</a> that you didn’t even know you needed. We can’t seem to wait to enter the much-hyped store!

EXCLUSIVE: IKEA APAC Head talks about what to expect from the upcoming IKEA store in Hyderabad

<a href="http://www.businessinsider.in/searchresult.cms?query=flipkart&amp;sortorder=effectivedate">Flipkart</a> is foraying into categories apart from electronics, mobiles and apparels. Now, it wants to become number one in online retailer of furniture and has set an ambitious target for itself. 
 Without compromising on profits, <keyword id="6354742" type="COMPANY" weightage="40" keywordseo="Flipkart">Flipkart</keyword> wants to achieve a 15-fold growth in the <keyword id="3327588" type="UNKNOWN" weightage="20" keywordseo="furniture-category">furniture category</keyword>. 
 
Flipkart is brining quite a few changes such as adding home furnishing and automobiles in its product category. 
 In the furniture one, Flipkart will face tough competition from <keyword id="6368309" type="COMPANY" weightage="20" keywordseo="Urban-Ladder">Urban Ladder</keyword>, <keyword id="864887" type="UNKNOWN" weightage="20" keywordseo="Pepperfry">Pepperfry</keyword> and Fabfurnish. 
 
Sandeep C Patil, a senior director at Flipkart, told ET, “Furniture is a $20 billion market, which is bigger than the mobile phone market.” 
 
Reportedly, Flipkart could achieve Rs 2,600 crore in furniture sales by the end of 2016. 
 
Meanwhile, Pepperfry and Urban Ladder want to register growth of at least 150%. 
 
"Right now verticals are bigger than horizontals in the category, but even after launching in October we are quite close to them in size. If our projections hold, we will be multiple in size of verticals," told Patil. 
 
Morgan Stanley has predicted that home furnishing will boom and reap huge revenues for ecommerce firms. 
 
(Image: Thinkstock)

Flipkart is expanding its product portfolio, wants to yield profits from furniture category

The furniture market in India is worth $16 billion. The furniture and appliances rental is estimated only at a third of that. However, while the sector is growing at a sizeable 25% month-on-month, only 2% of the industry is currently online. 
 
With sharing economy being on the rise across sectors, the country has seen over 13 startups coming into the space in 2015 alone. The names include Wheelstreet, Etashee, Rentickle and Rentsetgo among others. 
 
<a href="http://www.businessinsider.in/searchresult.cms?query=Rentomojo&amp;sortorder=effectivedate">Rentomojo</a> is among these startups. It is a marketplace that offers furniture, furnishings, appliances and other home verticals that house hunters can book at affordable rentals. It works on an asset-light model, and makes anything from 40-50% of the rental fee as commission on every booking, with the rest going to the vendor. 
 
The company is currently in the market to raise fresh rounds. It raised $2 million in pre-Series A funding from Accel Partners and IDG Ventures India last year. 
 
Business Insider sat down with <a href="http://www.businessinsider.in/searchresult.cms?query=Rentomojo&amp;sortorder=effectivedate">Rentomojo</a> CEO <keyword id="3210543" type="UNKNOWN" weightage="80" keywordseo="Geetansh-Bamania">Geetansh Bamania</keyword> to understand the <a href="http://www.businessinsider.in/searchresult.cms?query=online+rental&amp;sortorder=effectivedate">online rental</a> space better. 
 
Why could have caused the boom in <keyword id="3438857" type="UNKNOWN" weightage="60" keywordseo="online-rental">online rental</keyword> startups? 
As soon as an industry starts making money, people start trying to get in. This industry is here to stay because India is an income-constraint economy, with a maximum of 30-40k disposable income. That’s exactly why several <a href="http://www.businessinsider.in/searchresult.cms?query=e-commerce&amp;sortorder=effectivedate">e-commerce</a> companies are suffering. 
 
There is also a bunch of migration from tier II and tier III to tier I cities. This is because of the renewed cash flow and new opportunities being created. People are changing cities every 3 years. Combine the mobility quotient with the income constraint, and you’ll see the renting model making a lot of sense. 
 
Owning vs. renting in the long term. 
When you think of the long term, renting does lose to owning after a certain period. However, our consumer is typically somebody who’s looking to have it for 12-16 months. Also, as we go forward as a company we’ll experiment with 24-48 months rental periods. We’ll continue to offer price bands that will seem lucrative to you. 
 
OLX and Quikr are going pretty hard on add-ons and advertising. <keyword id="864887" type="UNKNOWN" weightage="80" keywordseo="Pepperfry">Pepperfry</keyword> and <keyword id="2539960" type="UNKNOWN" weightage="80" keywordseo="Urbanladder">UrbanLadder</keyword> now have EMI options. Are you worried? 
Our target segment is against the ownership model. You are bound to pay a pending EMI. However, renting allows you the flexibility to come out when you want. 
 
Inherently, rentals will always be lesser than EMI. That’s simple math. A <a href="http://www.businessinsider.in/searchresult.cms?query=Pepperfry&amp;sortorder=effectivedate">Pepperfry</a> or <a href="http://www.businessinsider.in/searchresult.cms?query=UrbanLadder&amp;sortorder=effectivedate">UrbanLadder</a> will have a sourcing cost, a gross margin and a final market price. However, our rental costs will always be lower as they are based on the sourcing cost, and not the market value. 
 
For second hand buying, from a unit economics perspective, I don’t know how lucrative a business it is to be in if you’re making money from relocation. 
 
Why not own some furniture? 
As the industry matures, we’ll be deploying several crore units a month. It’s not going to be scalable. Also, owning also comes with an inherent risk. 
 
The ease of operating a marketplace model is why we replicated it. That’s why our unit economics have been positive from day 1. 
 
<a href="http://specials-images.forbesimg.com/imageserve/56cbe59ce4b062f6b59a4bef/0x600.jpg?fit=scale&amp;background=000000">Image Source</a>

Rentomojo CEO wants to make an online offer
you can’t refuse

When it comes to buying furniture, no one has the time to do it the old fashioned way, which required the customer to visit the store, browse through catalogues and then find a way to get it made through an <keyword id="6466632" type="POSITION" weightage="20" keywordseo="interior-designer">interior designer</keyword> or a retailer. With the e-commerce boom, buying furniture has been simplified through start-up companies like Pepperfry, HomeLane and <keyword id="2644491" type="PERSON" weightage="20" keywordseo="LivSpace">Livspace</keyword> even as consumers demand more variety for less cost. The unlikely victims of this online buying had been independent designers who saw many customers drop out for better and easier online offers but the situation has been changing. Livspace which is trying to ‘democratize’ home design is trying to bring homeowners and designers and vendors on the same platform and work simultaneously to create better value for both. What that means is that customers can get the expertise of a designer and get the execution done faster with great materials while estimating the cost, which is unheard of. How does it work ●Homeowners typically contact Livspace online and fill a quick form to describe their requirements. They can even shortlist designs from thousands of looks ●Quickly thereafter a designer is assigned to their project, based on their project scope, aesthetic preferences and location. ●The designer meets the homeowner and understands their design, home and lifestyle needs. They present concepts for their home quickly using the software called Canvas.● Once a homeowner likes the initial concepts and books Livspace, they collaborate with their designer to finalize the designs after seeing it all in 3D/virtual reality, experiencing real designs at our Design Centers or experience apartments and touching all materials. ●The final orders are placed and the project plan is shared in the customer account. ●Within a few weeks, a Livspace team of experts delivers and installs every product and service to make their home exactly like the picture. Livspace Canvas Canvas is a cloud-based, design platform which is accessible to all certified <keyword id="107252" type="ORGANIZATION" weightage="60" keywordseo="interior">interior</keyword> designers on Livspace. I tried my hand at the software and learned how easy it is to manage an interior design project with Canvas where designers can manage all their projects from start to finish in one dashboard and plan spaces in 2D and convert the design to 3D and virtual reality demos. The designers can also auto-generate invoices that are linked to the designs they create in real-time and place orders for all products and services, with no worry about the supply chain and delivery. Interior designers can even create a Virtual reality demo for the customer’s home design which they can access online.

I tried the platform that is using Virtual Reality to help customers find affordable Interior designers in India

Like any other startup striving to make work fun for its employees, <a href="http://www.businessinsider.in/searchresult.cms?query=urban+ladder&amp;sortorder=effectivedate">UrbanLadder</a>, the online furniture website too does offer the usual <a href="http://www.businessinsider.in/searchresult.cms?query=employee+perks&amp;sortorder=effectivedate">perks to their employees.</a> 
 “We have free food for all our employees. There’s free breakfast, and lunch. We have fruits at 4 pm and snacks later,” says <keyword id="3397831" type="UNKNOWN" weightage="100" keywordseo="Rajeev-Srivatsa">Rajeev Srivatsa</keyword>, co-founder and COO, <keyword id="2539960" type="UNKNOWN" weightage="100" keywordseo="Urbanladder">UrbanLadder</keyword>. 
 
But, what really sets the startup apart is their parental benefits. 
 
Srivatsa claims that almost 38% of their employees are women and thus it is imperative for them as a brand to undertake policies that help women at the workplace and the chief among them is their <a href="http://www.businessinsider.in/searchresult.cms?query=maternity+benefits&amp;sortorder=effectivedate">maternity benefits</a>. 
 
As of April, the company has extended its <a href="http://www.businessinsider.in/searchresult.cms?query=maternity+leave&amp;sortorder=effectivedate">maternity leave</a> to twenty six weeks for their <a href="http://www.businessinsider.in/searchresult.cms?query=employees&amp;sortorder=effectivedate">employees</a>. That is a whopping six months. 
 
Additionally, they also have the option of being able to take an extra three months of part-time work that the company hopes will act as a transitional period for all involved- the new mom, baby, the family and UrbanLadder. 
 
 
 
During this period, employees can choose to work upto 5 hours at an equivalent pay basis or opt for an additional three months of unpaid leave. 
 
Infact, these benefits also extend to those employees who choose to adopt or have surrogates. 
 
According to the company, the aim behind this move is to ensure that women don’t feel the need to take a break from their careers and then end up not returning to work full time. 
 
“We understand the difficulty in striking a balance between motherhood and work,” says the company. 
 UrbanLadder’s maternity policy even beats social networking giant <keyword id="6354576" type="CITY" weightage="100" keywordseo="Facebook">Facebook</keyword>’s rather generous policy. As of the moment, news mothers in the country are entitled to 12 weeks of maternity leave from Facebook. 
 
Image credit: Indiatimes

This startup's maternity leave policy is the best thing to happen to working women in India

World famous incubator <keyword id="834871" type="UNKNOWN" weightage="100" keywordseo="Rocket-Internet">Rocket Internet</keyword>, based in Berlin, Germany, runs a string of consumer internet companies in India. However, in a first of its kind sale of property, it is likely to sell the online furniture retailer FabFurnish to the <keyword id="44949" type="CITY" weightage="100" keywordseo="Future-group">Future Group</keyword>, led by <keyword id="44950" type="PERSON" weightage="100" keywordseo="Kishore-Biyani">Kishore Biyani</keyword>. 
 
Not only this, it also wants its fashion online retailer Jabong to be offloaded to the Future Group in a bid to reduce losses; however, Biyani has not shown much interest in the business. 
 
"The two are in definite talks to close the FabFurnish deal. Sale of Jabong is still at the proposal stage and no talks have started on it yet," said one of the persons cited above. Jabong, however, has denied the news of being up for sale. 
 
The company has "seen strong operating performance in recent months and has strengthened its management team with a number of hires," a Jabong spokesperson told ET. "Jabong is not in discussions, at any stage, with anyone, regarding a sale of the company. The company's largest see-through investor reiterated earlier this month its commitment to the business and the Indian market." 
 
The sources also cited that Fab-Furnish could be sold for $5-10 million, however the figure was not independently verified. 
 
If things go as per Rocket Internet’s plans, it will be the first time that Biyani would acquire an online retail business. He has, in the past, been a strongly outspoken critic of the country's ecommerce industry. 
 
<a href="http://businessbrokersaustin.com/wp-content/uploads/2015/06/business-for-sale.jpg">Image source</a>

Rocket Internet’s selling 2 really big online brands to the Future Group

New Delhi, Dec 23 () HomeLane, a home interiors company, on Monday said it has raised USD 30 million (about Rs 213 crore) in funding led by new investors Evolvence India Fund, Pidilite Group and FJ Labs.
The series D round also saw participation from Sequoia Capital, Accel Partners and JSW Ventures. With the current round, the total funding raised by HomeLane stands at USD 46 million.
The current round is estimated to value the company at USD 150-250 million.
"We will use the funds for three things - for our next phase of growth that will include launching renovation as a category; scaling our proprietary design-to-manufacturing platform to more designers, vendors and installers; and expanding to 8-10 new cities in India," HomeLane founder and CEO Srikanth Iyer told .
He added that part of the funding will also be deployed towards technology to improve experience and efficiency for consumers and design partners.
"This investment is very timely for the company, considering we are closer to EBITDA profitability, and will be used for growth, brand and technology," he said.
The company plans to ramp up its experience centres from the current 16 to 30 by the end of 2020. It also intends to hire 300-400 people to take its headcount to about 1,400 over the next one year.
Founded in 2014, HomeLane.com has a presence in Bengaluru, Chennai, Hyderabad, Mumbai, NCR, Kolkata and Pune. It is looking at expanding into cities like Coimbatore, Vizag and Jaipur, among others.
Iyer said India's home interiors market (worth about USD 18 billion) has massive untapped potential. 
"With this round of investment and such an accomplished group of investors, we will double-down on establishing our brand across existing and new markets. We will exit FY20 at an average revenue run rate of Rs 700 crore and are on track to getting to company-wide profitability in early FY21," he added.
The RainMaker Group acted as the sole financial advisor to the company.
In a BSE filing, Pidilite Industries said its wholly-owned subsidiary, Madhumala Traders has agreed to make an investment of Rs 49 crore in Homevista Decor and Furnishings (HomeLane) by subscribing to series D2 cumulative compulsorily convertible preference shares.
The said shares, on conversion, would translate to over 5 per cent of the issued and paid-up share capital of HomeLane.com (on a fully diluted basis). 
The nature of subscription will be cash, and is being done at a mutually agreed pre-money enterprise valuation that has not been disclosed due to reasons of confidentiality, the filing said.
"As an organisation, we continuously track the development of the startup ecosystem in adjacent areas and relevant geographies. We intend to make strategic financial investments in relevant startups and support and collaborate with these startups for mutual benefit," Pidilite said. SR ANU

HomeLane raises USD 30mn from Evolvence India Fund, Pidilite Group and others

<ul><li>In an exclusive interview with Business Insider, Pankaj Makkar, Managing Director, <keyword id="1982364" type="PERSON" weightage="20" keywordseo="Bertelsmann-India-Investments">Bertelsmann India Investments</keyword> said that <keyword id="864887" type="COMPANY" weightage="20" keywordseo="Pepperfry">Pepperfry</keyword> is on the right path for fast growth.</li><li>Bertelsmann India Investments has been an investor in Pepperfry since 2014. </li><li>Pepperfry which had last raised funding in March 2018, is reportedly looking to raise another $100 million. </li></ul>Eight-year old online retailer of furniture and home products, Pepperfry, has been one of the market leaders in its segment in India. And its early investors are backing the startup for faster growth and scale. In an exclusive interview with Business Insider, Pankaj Makkar, Managing Director, Bertelsmann India Investments, who invested in Pepperfry in 2014, said that they are in no hurry to exit from the startup as it’s doing really well. Pepperfry has been scaling up its businesses and is also looking at achieving its $1 billion Gross Merchandise Value (GMV) <a href="https://www.moneycontrol.com/news/business/companies/pepperfry-targets-gross-merchandise-value-of-1-billion-by-2021-3754081.html">target</a> by 2021. With over 6 million customers, Pepperfry has 39 offline studios across 22 cities in India and is launching more. “Pepperfry has always been ahead of the curve. Its omni-channel strategy of scaling up operations across metros and tier I and II cities, has worked exceptionally well. We are confident that with the right scale and their strong unit economics, Pepperfry will continue to lead the furniture <keyword id="436047" type="COMPANY" weightage="20" keywordseo="Ecommerce">eCommerce</keyword> space in India,” said Makkar. The propelling factor in Pepperfry’s journey would be there right selection to be in the e-commerce category unlike in horizontal e-commerce (businesses that sell products from various categories). “In e-commerce, if you look at horizontal businesses, they play on very small margins but if you look at categories like furniture, they play on very high margins,” said Makkar. Founded by Ambareesh Murty and Ashish Shah, Pepperfry had last raised a funding of $38.5 million in March 2018. According to reports, the company is also looking at <a href="https://tech.economictimes.indiatimes.com/news/internet/existing-investors-may-invest-100m-in-pepperfry/67519933">raising another</a> $100 million this year. While its valuation remains undisclosed, it has often been <a href="https://inc42.com/datalab/30-indian-soonicorns-that-have-the-potential-to-be-unicorns-by-2020-part-2/">listed</a> as a soonicorn (soon to be unicorn or valued at $1 billion). See Also: <a href="https://www.businessinsider.in/after-amazon-pepperfry-launches-wedding-gift-registry-on-its-platform/articleshow/68171208.cms">Indian e-tailers want you to choose the presents that your friends will pay for</a> <a href="https://www.businessinsider.in/heres-why-pepperfry-is-taking-the-omni-channel-route-before-ikea-enters-the-indian-market/articleshow/59730212.cms">Here’s why Pepperfry is taking the Omni-channel route before IKEA enters the Indian market</a>

An investor in Pepperfry, India’s largest online furniture retailer, is in no rush to exit

<ul><li><keyword id="864887" type="COMPANY" weightage="20" keywordseo="Pepperfry">Pepperfry</keyword> has partnered with <keyword id="1865968" type="COMPANY" weightage="20" keywordseo="BankBazaar">Bankbazaar</keyword> to offer <keyword id="6362287" type="UNKNOWN" weightage="20" keywordseo="loans">loans</keyword> for home refurbishing. </li><li>Users will have to head to Studio Pepperfry and apply for a loan. </li><li>Earlier this year, the startup had also introduced gift registry. </li></ul>India’s home-furnishing retail startup Pepperfry has partnered with Bankbazaar to offer loans on home renovation. With this partnership, users looking to renovate their house can head to Studio Pepperfry and apply for a loan. Studio Pepperfry is the online startup’s offline experience store. “Through the introduction of this easy credit facility, we will help our customers furnish and renovate their homes in a seamless way. Our partnership with BankBazaar, a leading personal finance marketplace, helps provide multiple home upgradation loan options from various leading banks in India,” said Mihir Kulkarni, Head – Studio Innovation, Pepperfry. Earlier in February, Pepperfry had also announced its gift registry, where users can create a registry, add the products to their list and then share the registry with friends and family, who can then buy these products. Pepperfry had last raised a funding of $38.5 million in March 2018. According to reports, the company is also looking at raising another $100 million this year. See Also: <a href="https://www.businessinsider.in/after-amazon-pepperfry-launches-wedding-gift-registry-on-its-platform/articleshow/68171208.cms">Indian e-tailers want you to choose the presents that your friends will pay for</a> <a href="https://www.businessinsider.in/pepperfry-to-ipo-soon-this-investor-says-yes/articleshow/68740748.cms">An investor in Pepperfry, India’s largest online furniture retailer, is in no rush to exit</a>

Pepperfry and Bankbazaar are now offering loans to refurbish homes

<ul><li>Their omnichannel strategy has worked well with close to 40% revenue coming in indirectly from their offline studios, reveals top <keyword id="864887" type="COMPANY" weightage="20" keywordseo="Pepperfry">Pepperfry</keyword> executive. </li><li>In an exclusive chat with Business Insider, Pepperfry says the company will increase the number Pepperfry Studio locations to over 100.</li><li>Pepperfry has announced the launch of its Snooze Studios which will sell sleep accessories like mattresses. </li><li>The startup aims to rake in a revenue ₹20 billion by the financial year 2021 through its in-house brands alone.</li></ul>In the last eight years of its existence, Pepperfry has grown to be one of the success stories of India’s <keyword id="35621" type="PERSON" weightage="20" keywordseo="e-commerce">e-commerce</keyword> boom but the startup’s Vice President and Head of Omnichannel expansion, Mihir Kulkarni, had an interesting revelation to make in an exclusive interview with Business Insider – the sales had doubled after they opened physical ‘experience’ stores. “In every new catchment that we have opened up the offline studio, the city’s sales have grown by 90-100%. We now plan to take our store count up to 100 by the end of the fiscal year,” said Kulkarni. Their omnichannel strategy has paid off. Pepperfry launched its first studio in 2014. Since then, they expanded it to 65 studios across 28 cities. “While we don’t sell directly through our offline studios, they contribute significantly to our sales. Close to 40% of our overall turnover comes from the online bookings made at these studios,” said Kulkarni. This is a telling sign of the nature of evolution of the much-celebrated boom in Indian e-commerce. Other startups like Craftsvilla, Faballey and more recently Popxo have also recently launched offline stores to further grow their business. Amazon which had although pulled the plug on its global mall pop-up stores, didn’t give up on offline retail. <a href="https://www.businessinsider.in/Amazon-quietly-launched-a-new-store-in-malls-after-pulling-the-plug-on-its-pop-up-stores/articleshow/69487379.cms">Instead</a> it launched ‘Presented by Amazon’ a range of kiosks. Pepperfry is definitely doubling down on its offline efforts but it is also looking to keep its capital investment low. It plans to expand its presence in Tier-II cities in India but would rather have more franchisees than owned stores. “Currently, out of the 65 stores, 12 are through the franchise model. We expect the number to go up to 25 by the end of the year,” said Kulkarni. The sleep market Beyond physical stores, Pepperfry is also betting big on in-house brands particularly in, what Kulkarni likes to call, the ‘sleep’ market -- mattresses, bedsheets, pillows, and more. Pepperfry is pushing these new products through its in-house brand, Clouddio. The startup aims to rake in revenues to the tune of ₹20 billion by 2020-21 through in-house brands alone. In 2017-18, Pepperfry had announced a gross merchandise volume of ₹15 billion. And, over half of its current revenue comes from in-house brands. The e-retailer also announced the launch of Pepperfry Snooze Studios – its line of products for the sleep market – within its <keyword id="3437283" type="PERSON" weightage="20" keywordseo="studio-pepperfry">Studio Pepperfry</keyword>. Sleep smart The sleep market is currently valued at $2.5 billion in India and is growing at 10%. Pepperfry is also experimenting with IOT-enabled products for this market– from beds that have an in-builtalarm clocks to ones that monitor sleep patterns. These products could hit the market in a few years. “The sector is highly unorganised and in terms of consumer experience. It is a broken category. That is why we want to crack open the market with our successful omnichannel strategy,” said Kulkarni. See Also: <a href="https://www.businessinsider.in/paytm-clocks-50-billion-through-5-5-billion-transactions/articleshow/69670592.cms">Paytm’s year in a review – Billions, profits and frauds</a> <a href="https://www.businessinsider.in/naukri-jobs-is-using-artificial-intelligence-to-take-on-linkedin/articleshow/69751271.cms">An Indian internet company older than Google is using Artificial Intelligence to reinvent itself</a>

EXCLUSIVE: An online furniture retailer in India saw its sales double after it opened physical 'experience' stores

<ul><li>90% of the furniture market is unorganized and a lot of organized brands who dared to venture in this category, frizzled out eventually</li><li>However, <keyword id="864887" type="COMPANY" weightage="20" keywordseo="Pepperfry">Pepperfry</keyword> has maintained a consistent growth ever since its launch. It has achieved a CAGR of more than 80%</li><li>Despite the poor economic conditions, Pepperfry aims to break even under 6-9 months and aspires to be a <keyword id="7438361" type="UNKNOWN" weightage="20" keywordseo="billion-dollar-company">billion dollar company</keyword> by <keyword id="8078701" type="UNKNOWN" weightage="20" keywordseo="march-2021">March 2021</keyword></li></ul>Pepperfry, an eight-year-old furniture and decor company, has managed to succeed in a complex category like furniture where close to 90% of the sector is unorganized. While many other platforms entered the category and fizzled out with time, Pepperfry continues to hold its own. In the e-commerce adoption cycle, furniture comes in at a later stage (compared to books, electronics, fashion, grocery etc.) but Pepperfry now stands at 65 stores across 24 cities and aims to launch 100 Pepperfry Studios by next year. In the first four years since its inception, Pepperfry’s marketing budget ranged between Rs 25-40 crore annually. However, there has been a 70% jump in advertising and marketing budget in FY19 and their total spends stand at Rs 135 crore now. According to Kashyap Vadapalli, CMO, Pepperfry, 60% of the marketing budget is invested in digital mediums, about 45% on performance channels and 15% on brand or content initiatives. In an interview with Business Insider India, Vadapalli further tells us how Pepperfry helps give local artisans a boost, its content marketing journey, and how with all of this, it has managed to achieve a CAGR of over 80%. Excerpts: Q. How has Pepperfry's journey been so far in India? Tell us a little about your financial trajectory? Over the past 7.5 years, Pepperfry has increasingly built special competencies to serve the Indian market and bridge the existing gaps in the market. We have elevated consumer experience manifold by building a curated marketplace, ensuring the highest levels of quality control and providing a robust post-transaction experience of delivery and installation. On the back of our understanding of Indian consumers in the furniture segment, we introduced ten dynamic House Brands to democratize the market by addressing unique design philosophy and price points. We pioneered the omni-channel strategy in India by creating multiple touchpoints for consumers across the length and breadth of the country. We launched our first experiential Studio in 2014 and today we operate 65 of them across 24 cities in India, which are built on a solid bedrock of an unparalleled supply chain infrastructure. Each of these offerings are built on the premise of creating superior consumer experiences, which is the cornerstone of our brand motto- happy furniture to you. Thus, building a strong brand that makes it to the consideration set each time. We have had strong and consistent growth ever since launch, in the last 4 years we’ve achieved a CAGR of more than 80%, we are likely to breakeven in under 6-9 months and aspire to be a billion dollar company by March 2021. Q. What do you think sets Pepperfry apart in the category? What are the challenges faced by the company? Pepperfry is the dominant player in the category, as it is the only truly omni-channel player in the segment while most other brands are multi-channel. Pepperfry is also the only curated home and furniture marketplace, which offers a wide portfolio of products for consumers to choose from while also helping them filter choices based on quality, price and preferences. In the e-commerce adoption cycle, furniture comes in at a later stage (compared to books, electronics, fashion, grocery etc.) so we have to work extra hard at acquiring customers. Furniture is also a high-ticket, high-involvement, low-frequency, non-standard item – coupled with the fact that consumers are less-savvy about the technical and quality aspects of furniture – these are the key challenges to online conversion and scaling. We have tried to overcome these challenges by bringing in customer education, through quality listings and content, bringing in AR capabilities on the mobile, having 3D visualisations on the website and also opening up Studios in 65 places across the country. We have seen that each of these features, touchpoints gives us an additional lever to acquire customers and scale. We have also focussed on building a well-recognised brand and have established best in class service capability. Q. What's the ‘360-degree-marketing’ strategy at Pepperfry? The furniture market in India is largely fragmented, with over 90 percent occupied by the unorganized sector. At Pepperfry, it is our aim to change the buyer’s behavior to move from traditional methods (custom furniture, small unorganized players etc.) to organized platforms that offer better value, variety and service. As a marketer, it is essential to view one’s brand from a funnel perspective right from awareness and acquisition to engagement and loyalty via conversion or activation. Over the years, we have created strong brand equity through a mix of both digital and non-digital mediums. At the acquisition stage, we run strong performance marketing campaigns targeting the potential consumers through varied mediums. For conversion, we utilize various tools such as cash-backs and coupons, which aid in pushing the consumer towards the transaction. We also ensure high engagement with our customers through multiple touch points which results in a high repeat rate. This is achieved through push notifications, emailers and traditional campaigns and also by keeping consumers engaged through content led pieces which integrate our brand into a plotline. Therefore, we engage with consumers through varied mediums activating a combination of myriad channels at different points of time. Q. Since its inception, Pepperfry has chosen to use content marketing. (With Miss Malini, Girlyapa, TVF, Dice Media) Can you tell us what influenced your decision to take that route? In today’s dynamic and competitive market ecosystem, it is essential that brands seek clarity on what they offer to a consumer, what pertinent problem is being solved through this offering and who their target demographic is. When we launched Pepperfry, we decided to create a brand that offers great variety at a great price alongside seamless consumer services, thereby filling several existing gaps in the market. Our key target demographic therefore became the urban millennial i.e., individuals in their late 20’s and early 30’s from metro and tier 1 cities who were early adopters of the internet and online shopping. We leveraged this by ensuring that each of the platforms we chose had a significant overlap with our target demographic thereby helping us create brand awareness and high top of mind recall among these individuals. While co-curating content for these partnerships we refrained from forcibly integrating our products and offerings into the sketches, a blunder brands often make. Today, our presence on digital platforms has grown significantly higher – 50% of the marketing budget is invested in digital media - to ensure we are constantly engaging with our customers. Q. What is the marketing budget set aside this year? How has your marketing budget evolved over the years? By what percentage? Pepperfry was launched in 2011 and for the first 3-4 years, our marketing budget ranged between 25 to 40 crores annually. Over the last 4 years, our marketing budget has ranged from 60-90 crores, with this year being in the higher end of the above range. While we continue to grow business at high double digits even at scale we have managed to stabilize our marketing budget because as a brand gets stronger and our marketing channels get more efficient the same investment yields better results, both qualitatively and quantitatively. Q. What is your media mix? Which medium gets the lion's share and why? Our media mix is evenly distributed with our marketing budget being split equally between both digital and traditional mediums. Within digital, performance marketing occupies a key position with 70 - 80% of the digital budget being allocated to it while 20 - 30% is allocated to brand and engagement enhancing digital mediums. We focus on performance marketing channels as they help drive consumer acquisition. Traditional mediums, too, play an essential role in our marketing mix wherein, 70-80 percent of the total spends of the traditional bucket are allocated to television as it as it allows us to scale both reach and impact quickly, especially for seasonal promotions, such as Diwali and Independence Day, etc. The remnant 20-30 percent is allocated to radio and outdoor advertising, which play the role of support mediums in large campaigns. Q. There was a top of mind recall survey, according to which Pepperfry ranks 1st in the category. Can you tell me a little bit more about it? For more than a year, we are running a continuous brand track, which has covered more than 20,000 respondents across the top 8 cities. This Brand Track is executed by our partner research firm who are part of GroupM. Pepperfry scores the highest rank across all key parameters such as – TOM (top of mind), preference and intent and usage. Consistently we have seen that we have a TOM score which is more than 100% higher than the 2nd nearest brand. This shows that we have the most recalled brand name in the segment and we have built it basis a very clear and sharp proposition of “Happy Furniture to You” that we have been taking to the media over the last 5 years. Q. Many platforms had entered the category but have slowly fizzled out. What has helped Pepperfry tackle difficult market situations? This is a complex category given the unorganised market ecosystem and multitudes of variables when it comes to purchase decisions. Most other platforms that have not succeeded to scaling in this market had not been able to manage the complexity. They typically would focus on technology and marketing while the key factors are operational execution at a category management level and at logistics. At Pepperfry, we decided to build all the aspects of customer value delivery ground-up and in-house, right from merchant capability development to catalogue building to merchandising to quality control to first-mile and last-mile logistics and also installation support. In a nutshell, an integrated, full-stack, product and service offering that was designed around the consumer. The ownership, control that this approach gives, coupled with strong data led process improvement practises helped us to scale and tackle the disorganised nature of the market. Q. How are you making sure that your organization is environment friendly, considering you use a lot of wood in your furniture? As a business, we encourage and enable the manufacturers we partner with to procure raw materials only from authorized and certified markets which follow proper practices when it comes to acquiring wood and other components. As an organization, Pepperfry has planted over 1-lac trees in areas across the Rajasthan belt and will continue to do so, by partnering with organisations involved in afforestation efforts. Q. How have you been making sure that local artisans get a boost? We believe in providing a platform for small businesses to showcase their products to the pan-India market, consequently more than 80% of the merchants on Pepperfry are small and medium business who are based in traditional wood-working hubs across the country. When we first collaborated with these SMEs, they were largely traditional in their approach with little to no access to larger markets. We took it upon us to build their capabilities by enabling their technological infrastructure, aiding them with raw material procurement and standardization of the products. Today, each of these businesses have received a remarkable boost in their overall business practices with a significant increase in revenues. Q. What is your expansion plan? Where do you see Pepperfry in next three years? A large part of our current focus is to simplify the furniture segment to enable larger chunks of consumers to shift from traditional to online purchasing. This effort is being supplemented by the rapid expansion of our omni-channel model which will further aid in building not just brand awareness but also consumer trust and affinity due to the availability of the ‘touch and feel’ aspect of purchasing. Today, we stand at 65 stores across 24 cities with an aim to have 100 Pepperfry Studios by next year. We are also focused on scaling our modular furniture capabilities in urban markets to provide consumers with bespoke solutions that are tailor-made to suit their budget and preferences.

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