Offline mattress industry mostly runs on expensive, inefficient model says SleepyCat co-founder
In an exclusive conversation with Indian Retailer, SleepyCat co-founder and CEO Kabir Siddiq, tells why this is the right time to sell mattress online.BY Shwetha Satyanarayan | September 06, 2018 | comments ( 0 ) |
The startup ecosystem seems very bright for the mattress industry with many players jumping the online bandwagon in the last three years. Mumbai-based startup SleepyCat is one such player which took the e-route to tap the market. In the one year of its launch, the mattress makers have grown at 150 per cent. But why is this industry so lucrative for startups? Excerpts:
Let’s start with talking about the current market for online selling mattresses companies in India. Why is there a sudden rush for many companies to sell mattresses online in the last two or three years?
Well, for long, mattresses were never the aspirational piece of furniture while setting up a house. People searched for good sofas and were even willing to spend a lot on sofas, but nobody cared about mattresses. Probably they were just bought at a nearby store that came within the budget of customers. However, consumers have now understood the need for good sleep and more people are willing to spend on mattresses. Higher penetration of internet and cheaper way to reach a larger number of people is helping etailers like us. Also, ecommerce marketplace is making it easy for startups to sell.
So what was your inspiration to start SleepyCat?
A friend who was setting up his business sought my help and while helping him, I happened to talk to a lot of people and understood that everyone complained of their mattresses and had some or the other issue with it. I made a list of all these problems and how they could be addressed. I realized the way mattresses were sold in India was completely an inefficient model, with a huge margin set aside for everyone from the time they were manufactured until it reached a customer. As a former investment banker, I had to do my research. After a massive research for close to two years, I understood the basic nuances of the business and was set to roll. We launched SleepyCat on Amazon in August last year.
What has been your go-to market strategy considering there is a lot of competition in the online space?
Much before we set foot in the market, there were a couple of established players. From the start, we wanted to do something different and not be just another brand in the market. We wanted to innovative in every way and that’s the reason we launched box mattress that could fit in a box and could be easily shipped to customers’ houses. Also, the mattress industry was inefficient and expensive, what we intend to do was add value proposition and compete with organized players like Kurlon, Sleepwell and with price point strategy take on the unorganized players. Importantly, we wanted to build a simple model that fits all, without confusing a consumer. One mattress model that was easy to choose and would meet everyone’s needs.
But don’t people still rely on touch-and-feel experience when buying a mattress? How difficult was it to break this myth?
Surprisingly, it wasn’t as hard as it may sound. For the first six months we were out of stocks after selling 40 mattresses in a month and then 175 units in the next 21 days. Our mattresses went all the way to Major Generals in Leh-Ladak and homes in Andaman and Nicobar Islands. Soon, we realized it was a need based industry and there was a lot of scope for growth. A simple example is in August 2017 we sold 40 mattress and last month (August 2018) we sold 700 mattresses. That’s how we have scaled.
So people from tier II cities and beyond are also shopping mattresses online?
Well, looks like yes! At least, our mattresses are not limited to just tier I or metro cities and maybe that’s the beauty of ecommerce marketplace. It takes a brand to even remote places and we have customers from across borders in the country.
Are you planning to tap more customers through offline expansion as well?
That’s our next target. We are hoping to raise funds for offline expansion and plan to start experiential centres in all the prime cities like Benagluru, Bombay and Hyderabad in the next 12 months.
What are your targets for the next year?
We are ready to launch three new products and will be adding more very soon. We are planning to raise funds to build better technology, service, add physical stores and more products. For now, the focus is to only grow.