Furnishing India January 8, 2019 Sierra Consulting
"Courtney Bowles, Laura Dorn, Andrew Schindler, Nick Sonek, Furnishing India January 8, 2019 Sierra Consulting. Explore the latest trends in interior design and consulting services offered by Sierra Consulting. Stay updated with the finest furnishing options and innovative solutions for your space."
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Presentation Transcript
Courtney Bowles Laura Dorn Andrew Schindler Nick Sonek Furnishing India January 8, 2019 Sierra Consulting
SC SC Who We Are Courtney Bowles Laura Dorn Andrew Schindler Nick Sonek
SC SC Executive Summary How can Pepperfry be profitable? Question Profitability, growth, survival Goal Horizontal Expansion Online Focus Brick and Click Alternatives
SC SC Agenda Introduction Analysis Alternatives Implementation Risk and Mitigation Questions and Answers
SC SC You Asked Us How can achieve growth and profitability while managing competitors?
SC SC You Asked Us How can achieve growth and profitability while managing competitors? Reality Check We know that managing a strictly E-commerce business is rarely profitable Amazon s E-commerce segment profitable 2 years ago
SC SC Industry Analysis (Porter s) Product Life Cycle Analysis Company Analysis (SWOT) Operating Landscape Customer Overview Customer Profile Value Proposition Customer Journey Customer Journey Competitive Landscape Channel Analysis Competitor Analysis
SC SC Operating Landscape Industry Analysis (Porter s) Customer Overview Product Life Cycle Analysis Customer Journey Company Analysis (SWOT) Competitive Landscape
SC SC Drill Down Analysis Industry Analysis Product Analysis Company Analysis Porter s Five Forces Product Life Cycle SWOT High competition Furniture at mature stage E-Commerce Platform Fragmented market Logistic Excellence Online furniture options pushing earlier into cycle Low supplier power Limited Financial Resources Looming Giants Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Drill Down Analysis Industry Analysis Product Analysis Company Analysis Porter s Five Forces Product Life Cycle SWOT High competition Furniture at mature stage E-Commerce Platform Fragmented market Logistic Excellence Online furniture options pushing earlier into cycle Low supplier power Limited Financial Resources Looming Giants Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Drill Down Analysis Industry Analysis Product Analysis Company Analysis Porter s Five Forces Product Life Cycle SWOT High competition Furniture at mature stage E-Commerce Platform Fragmented market Logistic Excellence Online furniture options pushing earlier into cycle Low supplier power Limited Financial Resources Looming Giants Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Drill Down Analysis Industry Analysis Product Analysis Company Analysis Porter s Five Forces Product Life Cycle SWOT High competition Key Takeaway: We are in an emerging yet competitive operating landscape ripe for consolidation. Furniture at mature stage E-Commerce Platform Fragmented market Logistic Excellence Online furniture options pushing earlier into cycle Low supplier power Limited Financial Resources Looming Giants Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Operating Landscape Customer Overview Customer Profile Value Proposition Customer Journey Competitive Landscape
SC SC Customer Target Customer Young Professionals Metros & Mini Metros Self-expression through d cor Omni-channel 30+ years old Pipeline Customer Furniture Rental New to work force Self-expression Not ready to commit 22-29 years old Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Customers The Majority of our customers are returning. These customers are: Customer Profile 1. Loyal 2. Spend more on average 2.20 3. 10x cheaper to retain than to gain new customer 3.3 Return New Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Value Proposition Gains -Ease of access -Design ideas -Peer recognition of style Job -Stylish home that expresses individuality Pains -Too many options -Inconvenient -Damaged goods -Price Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Value Proposition Gain Creators -Omnichannel approach -Stylish options -Delivery -In-store experience Gains -Ease of access -Design ideas -Peer recognition of style Job -Stylish home that expresses individuality Product -Furniture & Home D cor Pain Killers -App, Website, Store -Superior Logistics -Affordability -Curated Options Pains -Too many options -Inconvenient -Damaged goods -Price Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Operating Landscape Customer Overview Customer Journey Customer Journey Competitive Landscape
SC SC Customer Journey Loyalty Stylish Products Low damage rates Use Furniture Home D cor Self-Expression Purchase Online In Store Consideration Website App Experience Stores Awareness Word of Mouth Digital Ads TV Ads Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Operating Landscape Customer Overview Channel Analysis Competitor Analysis Customer Journey Competitive Landscape
SC SC Our Current Stores 34 Exist and are roughly 20% of our business INR 516 Million or 15.2 Million a store Customers coming to our stores spend 80-100% more
SC SC Suppliers Small and Medium Artisans Initial lack of experience with online platform Provide Support Functions Supplier Ecosystem Communication Mobilize Small Artisans Data Analytics accurately forecast orders Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Competitive Landscape Large Domestic Manufacturers Brick and Mortar IKEA E-Commerce Amazon India
SC SC Competitive Landscape Large Domestic Manufacturers Brick and Mortar IKEA E-Commerce Amazon India Vertical, Slightly More Online
SC SC Market Size Indian Furniture Market in 2020 (Billions USD) You created a new market channel, but 1.Online is 2% of Total Indian Furniture Market 2.Total Market is growing 8.2% CAGR a year 0.7 35 Instore Online
SC SC Profitability Trends in Revenue 0% 2013 2014 2015 2016 2017 -20% -40% -82% -60% -96% -80% -100% -127% -120% -150% -159% -140% -160% -180% Out of control Costs Falling Revenue as percentage of GMV Trending upwards
SC SC Key Performance Indicators Conversion Rate Profitability Customer Retention Order Size
SC SC Alternatives Online Focus Horizontal Expansion Brick & Click
SC SC Online Focus Focus on our core competency Pros Core competency Keep our brand in front of the consumer Cons Marketing and Advertising are essential Develop new digital features to interact with customers Small part of overall furniture market Not as sticky as physical experience Utilize our great delivery system
SC SC Horizontal Expansion Follow similar model to other ecommerce players Pros Decrease costs Expansion Cons FlipKart Amazon India Become less selective with suppliers Questionable profitability Lack of customer preference Dead inventory/products Increased competition Become less involved with supplier onboarding
SC SC Brick & Click We know: 80% of volume comes from smaller items Need to keep the customer coming back Pros Increase customer retention Promotes both online and in store sales Sales staff can upsell Cons Offer smaller items in store Take home from gallery Website Modifications Supply Chain changes Online In store pickup Room design feature
SC SC Analysis of Alternatives Horizontal Expansion Focus Online Brick & Click Profitability Conversion Rate Customer Retention Order Size
SC SC Analysis of Alternatives Horizontal Expansion Focus Online Brick & Click Profitability Conversion Rate Customer Retention Order Size
SC SC Why We Chose This Plan Reaches our customer Promotes the omnichannel model the best Works within financial parameters
SC SC Chosen Plan We have named the Brick and Mortar alternative Furnishing India
SC SC Furnishing India Supply Chain Road Map to IPO Training/HR Expansion Marketing Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Furnishing India Supply Chain Road Map to IPO Training/HR Expansion Marketing Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Value Chain Infrastructure Technology Human Resource Management Administrative Inbound Logistics Outbound Logitics Sales and Marketing Operations Services
SC SC Supply Chain What we do well Dropping margins lower Low breakages relative to global industry What we need to improve Outbound logistics still expensive proposition in e-commerce How to best improve turnover and leverage omnichannel model
SC SC Integrate with Brick and Click Utilizing the Pareto Principle 80% from 20% D cor and utilities should be pushed in stores Predictive Analytics Data analytics to understand consumer trends Help suppliers understand consumer preferences
SC SC Furnishing India Supply Chain Road Map to IPO Training/HR Expansion Marketing Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Training & Human Resources Teach employees in all store new purchase process Train sales people to identify items that go well together Hiring for new company stores Emphasize our brands when relevant Emphasize customer service Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Furnishing India Supply Chain Road Map to IPO Training/HR Expansion Marketing Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Marketing Brand Focus: Self-expression & lifestyle brand Content Development Consider partnership with a family friendly Bollywood star Website / App Integrate in-store & online experience Social Media Spotlight Privilege Partners Available near you feature Social Media Competition: Customers who are redesigning their homes submit photos Emphasize lifestyle rather than products Develop new design your room feature Continue targeted TV ads Develop loyalty program on app
SC SC Marketing Brand Focus: Self-expression & lifestyle brand Content Development Consider partnership with a family friendly Bollywood star Website / App Integrate in-store & online experience Social Media Spotlight Privilege Partners Available near you feature Social Media Competition: Customers who are redesigning their homes submit photos Emphasize lifestyle rather than products Develop new design your room feature Continue targeted TV ads Develop loyalty program on app
SC SC Marketing Brand Focus: Self-expression & lifestyle brand Content Development Consider partnership with a family friendly Bollywood star Website / App Integrate in-store & online experience Social Media Spotlight Privilege Partners Available near you feature Social Media Competition: Customers who are redesigning their homes submit photos Emphasize lifestyle rather than products Develop new design your room feature Continue targeted TV ads Develop loyalty program on app
SC SC Marketing Brand Focus: Self-expression & lifestyle brand Content Development Consider partnership with a family friendly Bollywood star Website / App Integrate in-store & online experience Social Media Spotlight Privilege Partners Available near you feature Social Media Competition: Customers who are redesigning their homes submit photos Emphasize lifestyle rather than products Develop new design your room feature Continue targeted TV ads Develop loyalty program on app
SC SC Marketing for Stores Loyalty Program Events & Workshops Billboards Interior Design Flower Arranging DIY Decor
SC SC Furnishing India Supply Chain Road Map to IPO Training/HR Expansion Marketing Questions and Answers Intro Analysis Alternatives Implementation Risk and Mitigation
SC SC Moving To more Studio sales 20% 50% Increase Stores to 150 in Total Over the Next 5 Years
