A bed that remembers your body shape, refrigerated cold mattress- it’s all about innovation for this startup!
Most often, when a customer went to buy a mattress, they were first asked for their budget, irrespective of their needs and body types.BY Shwetha Satyanarayan | July 18, 2018 | comments ( 0 ) |
Chaitanya Ramalingegowda, Co-founder, Wakefit
Although, the Indian mattress market is expected to grow to Rs 10,000 crore by 2020, it is largely an unorganized sector. While big brands with legacy to their credit were most often the preferred choices of buyers, online startup like Wakefit is aggressively changing the way people buy mattress. Growing at 10 pc MoM, this startup has sold over 1 lakh units in less than 3 years and sells over 3,500 units every month. In a conversation with Indian Retailer, Wakefit co-founder Chaitanya Ramalingegowda tells how brand building has changed over the years and how disruption is changing the industry business model.
What inspired you to sell mattresses online?
Two years ago, when Ankit, our co-founder, walked into a retail outlet to buy a mattress he was shocked learning about the prices of the mattresses because he was a chemical engineer and his family was into the business of supplying raw materials for making foam, that goes into mattresses. Aware that the raw materials don’t cost more than Rs 3,000 or Rs 4,000 to make a mattress, we tried to understand why the factories sold them at Rs 10,000 and retail outlets at nothing less than Rs 15,000. In this process, we learnt that costs were shooting up in the supply chain and there was multi-fold costs incurred by the time a mattress came from a manufacturer to a distributor to a retailer. Although the product did not cost so much, there was artificial inflation being created, and we wanted to address this. Hence, we decided to sell mattresses online.
How did your journey start?
So, we realized that most of the sales executives in retail showrooms were offered commissions and they just sold the mattresses that offered them the highest commission. Most often, when a customer went to buy a mattress, they were first asked for their budget, irrespective of their needs and body types. And typically, a customer would be fatigued trying to choose the one that suit their body, and ended up buying whatever cost less. We identified there were three key concerns- first being the supply chain cost, buying experience was not tailored to any customer and there was no touch point with any customer. With aim to address these concerns, we did R&D from our end and started off.
Touch-and-feel plays a key role in buying a mattress. How difficult was it to disrupt the market?
Well, unlike in the USA, where customers can sleep for 30 minutes or even 1 hour and try a mattress, here, a customer can maybe sleep for 5 minutes and try to buy one. But scientific reports suggest that a body needs at least 7 to 15 days to get adjusted to a new sleeping surface. Hence, we offered a 100-day trial policy to win customers’ trust and our current returns are less than two per cent. Our R&D and product quality is pretty strong which helped in winning customer trust.
So are most of your products tailored for individual customer demand?
No, we have only two products – the regular mattress and the orthopaedic memory foam- it takes the shape of the customer body pressure and retains it in its memory, which is why it’s called the memory foam. It’s relatively new technology and since we are selling it at lesser cost, it’s one of our best selling products.
But mattress retailing has been largely an unorganized market, with big brands like Kurlon, Sleepwell ruling the market. What were the challenges for a startup to build a brand?
Two things- most of the bigger brands have a legacy and they have taken 50 odd years to reach where they are, but many startups like us, have caused the disruption in a couple of years. Also, building a brand was not our focus because we wanted customers’ feedback and reviews to do the brand building exercise for us. Brand building has gone through a drastic change and as new age marketing has changed, so have the marketing strategies. Unlike the old decade, new age brands don’t spend crores on advertising. We have 3,000 reviews, a highest for an online mattress brand in India (Amazon, Facebook and Google combined).
A lot of startups have entered market with new brands like Sunday Mattress. Do you see competition? And, you have price-point strategy selling at less than Rs 10,000. Are customers ready to believe they are getting good products at less cost?
Definitely, there’s competition but we are the largest in India and other brands are 1/5th of our size. And talking about our price point strategy, our target customers were not the people who earn Rs 1 lakh salary pm, but maybe even Rs 30,000 and still should be able to afford our products. Our target was to reach bigger market in India and this was more exciting. We have 20-year warranty and strong customer support, so there’s no question of trust deficit.
What are your offline expansion plans?
We are doing a pilot project, where we are trying to sell our mattress in grocery store and we are calling it mini-experience centres. This will indirectly increase the cost of mattress and we don’t want that to happen. Offline expansion in any format is not on our agenda.
What next for Wakefit?
We are planning to expand in sleep category adding more products like quilts, maternity pillows, travel pillows and neck pillows. Also, we have sourced a new material which feels like it was refrigerated. This will ensure that the bed is cool even during summer and when a customer sleeps on it, he won’t feel the heat. There’s more innovation in the offing.