E-Commerce & Omni Channel
With the explosion of e-commerce, the way consumers shop has drastically changed. Companies who learn how to digitize, adapt and integrate online-offline behaviors enabling frictionless shopping experiences will be leader of this new future.
The Client
A leading regional mattress company engaged in the manufacture and marketing of rubberized coir foam and spring mattresses.
The Opportunity
The way mattresses are sold in India is a completely inefficient model, with a huge margin set aside for everyone from the time they were manufactured until it reaches a customer. The market is rather fragmented; though a few biggies like Kurlon & Sleepwell dominates the branded market. Estimates peg the mattress market in India to be Rs 10,000 crore in 2020. The mattress market in India has been undergoing a change to Direct to Consumer (D2C) over the past few years, witnessing a growth surge across the D2C brands developed by disruptors. As a result, major online mattress companies such as Wakefit (+7.2x), SleepyCat (+7.5x) and Sleepyhead (+53x) have seen a significant rise in their operational revenues over the last three financial years (FY18-FY20). AOC was tasked with developing the Direct-To-Consumer (DTC) channel encompassing E-commerce, Exclusive COCO stores & Institutional Sales.
The Solution
For developing this channel, we co-created competitive channel specific products targeting our focus consumer segment of 25-35 aged young couples, helped design and implement a new ecommerce focused website, listed the products on the major marketplaces and set up the logistic network to service customers across India.
For this exercise, there was multiple steps involved.
Our first task was to understand the competitive offerings of the leading players in the mattress market and then create a brand offering and positioning to plug the gap in the market along with capitalizing on the existing capabilities of our client.
Our next task involved creating customer segments we would be targeting and the key benefits sought by them and challenges they were facing currently.
This was followed by developing a comprehensive fulfilment plan.
Following which we created channel expansions for each of the D2C sub channels – Website, Marketplaces and Exclusive branded outlets. Each channel though having the same products would have a different profitability model due to the difference in expense components like commission, logistics, channel setup costs and discounting structures. The branding & marketing strategy was comprehensively utilizing social media & search engine ads, email campaigns, in-marketplace promotions, online influencer marketing, customer testimonials, allied industry influencers like carpenters, interior designers etc.
We finally created a financial plan outlining the revenue & cost structure for the next 5 years. This included components like Profit & Loss statement, Cashflow projection, Balance Sheet movements and a cost-volume-profit analysis shows the income or cash flows that occur with different scenarios of key assumptions, like sales or costs.