8/18/2019 New Business Segments- Furniture
1/8
CE v7.0
New Business Segments and Approach for Urban
Ladder
VIMAL GARG
Bangalore, 26th July 2015
8/18/2019 New Business Segments- Furniture
2/8
Summary
2
New Business Segments
• Assuming that the focus for the comany is on more than to line than rofits, creating high value !usiness segments is
the "ey• Current target segment of the comany is uer mi##le class$affluent ur!an househol#s %ho nee# #ifferentiate#
ro#ucts, suerior customer service
• &o#ular "itchen an# flooring can !e ne% !usiness segments targete# at e'isting customer segment
• Both categories are largely unorgani(e# an# hence a nee# of rofessionalism an# uni)ue #esigns %ith suerior !uyingan# urchase e'erience is a otential nee#
• *aying caacity for right ro#uct + service e'ists, hence mar"et rovi#es e'citing oortunities
• &aor !usiness segment e'clu#e# from entry is Bathroom segment %hich is attracts cometition from esta!lishe#
layers such as "ohler, cera, aguar etc. an# rovi#es limite# ro#uct #esigns oortunities
New Business Segments
• Assuming that the focus for the comany is on more than to line than rofits, creating high value !usiness segments is
the "ey• Current target segment of the comany is uer mi##le class$affluent ur!an househol#s %ho nee# #ifferentiate#
ro#ucts, suerior customer service
• &o#ular "itchen an# flooring can !e ne% !usiness segments targete# at e'isting customer segment
• Both categories are largely unorgani(e# an# hence a nee# of rofessionalism an# uni)ue #esigns %ith suerior !uyingan# urchase e'erience is a otential nee#
• *aying caacity for right ro#uct + service e'ists, hence mar"et rovi#es e'citing oortunities
• &aor !usiness segment e'clu#e# from entry is Bathroom segment %hich is attracts cometition from esta!lishe#
layers such as "ohler, cera, aguar etc. an# rovi#es limite# ro#uct #esigns oortunities
Entry Model & Strategy
• Create su!-!ran# un#er r!an /a##er for !un#le# ro#uct an# service offerings
• ince these offerings %ill re)uires great imetus on installation an# after sales service, #ifferentiate# !ran#e# strategy isre)uire#
• Both segments allo%s leveraging of internal synergies an# !uil#ing common caa!ilities such as suerior materialrocurement, %oo# rocessing an# customi(ation, !uil#ing team of installation rofessionals
• Both segments can !e #eveloe# in-house %ithout much significant a##itional investment
• uggeste# mo#el of in!oun# logistics is comlete in-house solution %hich %oul# re)uire one time investments !ut alsoallo%ing !enefits to e'isting categories, !etter margins, imrove# )uality control, #elivery efficiency an# customersatisfaction
• ut!oun# logistics %ill re)uire investments in #e-centrali(e# infrastructure an# team, most of %hich %ill furtherstrengthen current logistics caa!ilities
• echnology shoul# !e leverage# to rovi#e customi(ation an# at-home shoing e'erience to customers
Entry Model & Strategy
• Create su!-!ran# un#er r!an /a##er for !un#le# ro#uct an# service offerings
• ince these offerings %ill re)uires great imetus on installation an# after sales service, #ifferentiate# !ran#e# strategy isre)uire#
• Both segments allo%s leveraging of internal synergies an# !uil#ing common caa!ilities such as suerior materialrocurement, %oo# rocessing an# customi(ation, !uil#ing team of installation rofessionals
• Both segments can !e #eveloe# in-house %ithout much significant a##itional investment
• uggeste# mo#el of in!oun# logistics is comlete in-house solution %hich %oul# re)uire one time investments !ut alsoallo%ing !enefits to e'isting categories, !etter margins, imrove# )uality control, #elivery efficiency an# customersatisfaction
• ut!oun# logistics %ill re)uire investments in #e-centrali(e# infrastructure an# team, most of %hich %ill furtherstrengthen current logistics caa!ilities
• echnology shoul# !e leverage# to rovi#e customi(ation an# at-home shoing e'erience to customers
8/18/2019 New Business Segments- Furniture
3/8
3
Objective for Urban Ladder is to become India’s argest onine destination for homefurnishing by providing distinctive products and superior customer e!perience
Key ase!ts
Mar"et S!enario
• 3n#ian furnishing mar"et is 420!n mar"et %ithhome furnishing !eing 65 of it. nly 10-15mar"et of %hich is organi(e#
• nline home furnishing mar"et e'ecte# togro% at healthy rate of 0-0
• *rivate la!el an# furniture is a high margin
category
Imli!ations #or $r%an Ladder
Business %'e!ti(es
• Need to (enture
into new
%usiness
segments and!ategories #or
ne)t le(el
re(enue growt*
• Maintain t*e
same standards
o# rodu!t
+uality and
!ustomere)erien!e
• 3ncreasing customers are loo"ing at one stosolution for home ro#ucts
• As reeat urchases increase nee# fortargeting same set of customers increases
• 3mortant for r!an /a##er to gain significantmar"et share in other categories as the sace%ill get increasingly cometitive going for%ar#
• 8enture into ne% !usiness segments !yrovi#ing value a##e# solutions to e'istingtarget segment
• 9uic"ly e'an# %i#e an# #ee for lo%ercustomer attrition
• :evelo su!-!ran#s as ilot roects to test;%ill it %or"
8/18/2019 New Business Segments- Furniture
4/8
,
/iving :ining Be#room >i#sut#oor+
?ome officeBathroom >itchen
-ur niture
ofasChairsa!lestorage
:ining setsChairsa!lestorageBar nits
Be#storage +
Accessories
Be#s
a!les +Chairstorage%ingsCri!s etc.
tu#y ta!le,chairsut#oor sets@a(e!o
>itchen 3slan#s,trolley, ta!les,
rac" etc.
t*
ers
:ecor /ightingugs&irrorshelves +in#o%sCurtains
:innerare
:ecor &attresses
*illo%s
:ecor /ighting&attresses
ugs
:ecor /ightingm!rellas,@rills@ar#en
Accessories
@eysers@rooming
Aliances
&irrorsBath Accessories
torageCoo"%are
Aliances
.omeimro(emen
t
looring looring
Bathroom fi'tures +fittings
anitary %arelooring + iles
>itchen i'tures
End/
Endsolution
s
/iving oomroects
:iningroom
roects
Be#roomroects
>i#s roomroects
Bathroom solutions&o#ular "itchen
>itchen re-mo#elling
1
2
"oing #ide in $itchen and #ooden %ooring can be attractive opportunities withine!isting target segment
irst line of gro%th target segments D going %i#e aroach
econ# line of gro%th segment - !uil# #esign caa!ilities
E'clu#e# from current focus as they shoul# !e a art of gro%inge'isting categories, !athroom segment is highly cometitive an#currently un-relate# to oerational synergies
8/18/2019 New Business Segments- Furniture
5/8
End to End Solutions .ome Imro(ement
Modular Kit!*ens -looring 0.ardwood1 Laminate1 Vinyl
(erall Mar"et
&o#ular "itchen is 41!n mar"et in 3n#ia&ar"et is largely unorgani(e# 70-75F rovi#e#!y carenters ma"ing custom #esigns as erre)uirements of househol#s
looring mar"et in 3n#ia has evolve# from ceramican# stone to %oo#.&ar"et is gro%ing at 0-5&ar"et is largely un-organi(e# 70-75F
ometition@o#re, lee", @lima etc. inclu#ing fe%
international comanies
Alternate otions such as &ar!le, granite an# ceramicetc. an# fe% international + #omestic !ran#s such as
trore 772, ar"ett etc.
E)e!ted o# 4ro'e!ts
otal 4G0mn househol# in 3n#ia5 target segment Hmn househol#s10 ne%$relacements I 0.mnrgani(e# 3n#ustryH25I 0.1mn
otal 4G0mn househol# in 3n#ia5 target segment Hmn househol#s5 ne%$relacements I 0.2mnrgani(e# 3n#ustryH25I 0.05mn
A(erage 5i!"et si6e s. 2 H5 la"h s. 500-G00 er s)ft $1000 s)ft I 5la"h H Gla"h
$r%an Ladder oortunity 5 mar"et share in first year5000 la"h I 150cr
5 mar"et share in first year 2500 6 la"h I 150cr
ustomer 4roosition
*rovi#ing solutions of functional racticality,#esign an# aeal
Effective sace management *rovi#e %arranties an# easy relacement
*rovi#e easy an# rofessional installation otions 9uality, #esigns an# convenience is a !ig concern 8ariety of otions, styles an# ugra#es offere# ni)ue roosition of allo%ing customers to sho
flooring online matching their current scheme *rovi#e %arranties an# floor care e#ucation
&oduar 'itchen and fooring are argey sti unorgani(ed and there is a need for high)uaity* attractive designs and superior customer service at affordabe prices
8/18/2019 New Business Segments- Furniture
6/8
7
+reate Sub,Brands under Urban Ladder to provide differentiated and dedicated mar'eting- promotion capabiity and awareness among construction industry professionas
End to End Solutions .ome Imro(ement
Modular Kit!*ens -looring
Entry Strategy
/aunch a su!-!ran# un#er r!an la##er rovi#ing#ifferentiate# solutions %ith suerior #esign an#)uality
ie u %ith architects, !uil#ers an# interior#esigners an# housing comanies
/aunch a su!-!ran# un#er r!an la##errovi#ing flooring otions un#er har#%oo#,laminate an# 8inyl
arget selecte# first set of customers an# createull for the ro#uct - lo% inventory an# oeratingcosts
ie u %ith architects, !uil#ers an# interior#esigners an# housing comanies
5arget Segment #or$r%an Ladder
ier 1 an# ier 2 citieser &i##les class$Affluent
ier 1 an# ier 2 citieser &i##les class$Affluent
*allenges ?igh rices an# lo% relacement #eman#3nvestments in high )uality an# see#y installationrocess
5e!*nology&o!ile a for customi(ing "itchen as er nee#s an#)uotes
&o!ile a for in home measurement an# )uotes
In%ound logisti!s 3nvest in manufacturing services for creating high)uality customi(e# finishe# ro#ucts
Channeli(e !ul" sourcing from #omestic an#international layers
ut%ound Logisti!s 3nvest in high )uality installation services 3nvest in high )uality installation services
A#ter Sales*rovi#e relia!le %arranty, relacement an# serviceotions
*rovi#e e#ucation on surface care an# treatment
8/18/2019 New Business Segments- Furniture
7/88
K ie-us %ith housing, architects an# !uil#ers, romote flooring an#mo#ular "itchens
K Aeal to the customer nee#s Daesthetics, hassle free, greatservice
K *rovi#e sho at home solutions, #emo servicesK :ifferentiate# #esigns an# otions in ro#uct
K hoers are more informe# an# sohisticate# an# more
#eman#ing in terms of customi(ationK ffer uni)ue com!inations of ro#ucts #esigns an# solutions
K emer the o%er of the imme#iate customer !y aealing #irectlyto the en# customer
K Create !ran# a%areness an# ull for ro#uct
K uerior an# relia!le customer service is the "ey
K Both mo#ular "itchen an# flooring re)uires e'tremely rofessionalservice %hich is )uic", neat an# efficient
Urban Ladder strategy shoud be based on product differentiation and superior end toend customer service
9i##erentiation 4illars Key Re!ommendations
Best ro#uct #esign an# )uality:
Bran# A%areness
3
Customi(ation
,
&ar"eting;
Customer service
2
8/18/2019 New Business Segments- Furniture
8/8
CE v7.0
./AN$ 0OU1