When Riddhi Ladhani logs onto Facebook, it is not merely to see what her friends are doing, but to see how many people are interested in buying her merchandise.

She is one of many new-age entrepreneurs who use social media to sell jewellery, bags, shoes, clothes and baked foodstuff.

“College students are always looking for accessories at reasonable prices. We provide these without compromising on quality,” says Utsa Bajaj who, along with Riddhi, owns Chic, a bag boutique started on Facebook.

It is as simple as starting a new page and adding pictures of merchandise, along with the details, without the hassle of setting up a full-fledged retail website. This reduces establishment and publicity costs, allowing the retailers to invest in other aspects, such as sourcing and distribution.

The initial investment varies according to the business, but is low compared to starting an outlet or website. This is a major draw for young people, especially college students, who cannot bring in too much capital. These entrepreneurs invest anything between Rs 15,000 and Rs 30,000.

Unlike the bigger brands, these small businesses do not formally advertise on Facebook and hence do not need to pay the site.

“The biggest advantage of this is word gets around faster on a social networking site. One ‘like’ could lead to ten views, which could translate to more orders,” says Varadha Balaji, co-founder of Scaramouche, which deals with personalised gift items.

Anuradha Nair, who sells jewellery, says, “I’m not setting up my own website as of now, as Facebook is a very visually vibrant medium. Instead I insist on spending more time picking up each piece personally.”

But this business is not without its challenges. Many entrepreneurs struggle to distribute their merchandise to different parts of the city.

“Since it is only a friend and I who run the business, customers need to come to our homes to collect the products. This proves to be inconvenient for some,” says Varadha Balaji.

The process of converting ‘views’ and ‘likes’ to sales is lengthy.

Says Utsa, “The costumer first comments on the picture, and then I ask him/her to contact me on my personal number. We then discuss delivering the bag and payment.” However, retail through social media is still a relatively new concept in Chennai.

Anuradha says, “We are still quite conservative about buying something online. When you can't touch and feel your product, you may not have the will to take the step and buy something online!”

This becomes especially relevant in the case of clothes, where sizes can be tricky. Returning goods proves to be difficult, as the distribution channel is complicated in itself.

While many such enterprises are still in a fledgling stage, they are earning reasonable profits.

“We started Chic in October 2012 and we have recorded a profit margin of 20-25 per cent,” says Utsa.

(Jyotsna and Kavya are students of ACJ, Chennai.)

(This article was published on April 7, 2013)
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