Online shopping drawing 40% new customers every month

Vaishnavi B., a 25-year-old media professional, rummaged around a few furniture shops in the high streets of Mumbai for a perfect shoe rack but could not find anything to her fancy. She was advised by her friend to check out online offerings and ended up with the exact design that she wanted and at a great bargain.

Like Vaishnavi, many other consumers are also waking up to the pleasures of online shopping for the right piece of furniture. With e-commerce stalwarts like Flipkart looking at entering this sector, offline players such as HomeStop, NeelKamal, Godrej, and Home Centre continue their battle with high rentals and ultra-large retail spaces to showcase their inventories.

In India, the overall furniture and home market is around $20 billion, but is largely fragmented and unorganised with a few large national brands.

Snapdeal launched its furniture category three months ago. Kunal Bahl of Snapdeal said the online furniture category is drawing around 40 per cent new customers every month. Based on the tremendous growth seen in a short span of time, the company is adding more sub-categories in the furniture section.

Bahl said though the potential is huge, there continues to be a smaller offering for the consumer. Even organised retailers are not able to offer their complete collection under one roof, he added.

Two major changes

According to Deepa Thomas, eCommerce Evangelist at Ebay, “Two major changes that we have observed in the past is the willingness of consumers to buy big ticket items at a single click. Consumers are finding it far more convenient to shop online, as the online option also ensures that the consumer can check out how the furniture would look in their home settings.”

UrbanLadder.com is into pure play furniture e-tailing. The company’s COO, Rajeev Srivatsa said lifestyle and home furniture were bound to be the leading categories in the e-commerce space in a short span. The company is investing in backend technology and in logistics. Urban Ladder serves five cities, but soon plans to expand to 12 cities in the next few months.

Kashyap Vadapalli, founder of online market place Pepperfry, said the two-year-old company has unique capabilities across sourcing, distribution, customer service and marketing that is helping it grow rapidly in the home segment. “As we move into the festival buying season, we are well set to achieve Rs 100 crore revenue, with 50 cent of it coming from furniture alone,” he said.

Pepperfry also retails other product categories such as apparels and footwear. Vadapalli added that the bonus point for e-tailers was the zero inventory model, that helps the company keep their costs down, compared to offline retailers.

Warehouses

Online furniture marts generally tend to have one warehouse to stock furniture and save on space. An offline retailer, on the other hand, would have to open more stores, and would also need to go to great lengths to ensure that each room is designed to reflect the entire range of furniture. For instance, in a bedroom, the offline retailer would tend to have all the furniture elements in the right place, with a three-door cupboard, a dressing table, a bedside table including the bed, which would take up a lot of space.

priyanka.pani@thehindu.co.in

(This article was published on October 3, 2013)
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