Going Strong With Pure-play Online Retail Agrawal looks at offline presence only as a complimentary strategy
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Aditi Murarka Agrawal, co-founder, Nestasia started her online lifestyle/home decor brand in 2017. She and Anurag Agrawal, co-founder, Nestasia, were frequently moving and doing up their homes in Singapore, Hong Kong and Murarka Agrawal's deep interest in online retail, led her to start Nestasia. "We realised that there is this true love of setting up a new home and making it our own and finding these little bits and bobs that are special to us to ensure that the home is special. So, we kind of decided to marry my love for online retail and the love for home décor and tableware. Then I moved to India in 2019 to do this for good and Anurag joined in soon after."
Adds Agrawal, "One of the main reasons why we were thinking of building Nestasia is that trends are changing. Increasingly, people are buying online and many people who shopped with us were first-time online shoppers as well, people who always want to decorate their homes. With such a wide variety of high-quality products, they are very interested to try out Nestasia. So, we wanted to build an online-first brand."
With around five years of operations, what do they see has changed and what is their TAM?
Says Anurag, "We believe that this market is an INR 1,00,000 crore market annually in India, most of which is fragmented. The first major change since we started is, the formalisation and consolidation of this market. As we come in and bring variety, it's something that people see for the first time and are more inclined to buy from us. The second major trend especially post the lockdown is that the comfort to shop online has dramatically increased and will continue."
On building a D2C brand and the challenges, says Agrawal, "The most important thing which we feel in a D2C brand is, as long as people love what they are buying, and they keep coming back, everything falls into place."
He says about starting D2C now, "With online marketing becoming more mainstream, consumers becoming increasingly confident to buy online, it's possible to set up a D2C. It's easier now than it was maybe 10 years ago and will be maybe 10 years down the line."
He continues, "The first challenge for us was to understand the types of products people were looking for. Where is that set of products where feedback is amazing, and then start building on that product."
"Second, online retail in India is still at its very infancy and delivery networks, etc. are slowly getting built over time."
For an online lifestyle brand, staying relevant with new products and categories is the growth-driver. Commenting on Nestasia's product innovation over the years, Murarka Agrawal says, "We have a very customer-centric approach to products. We are 100% on trend, and want to get the latest and the best designs, because we want to be known for a unique design product. Also, we do a lot of additions of new categories basis the feedback from our customers and have a very data-driven approach to things. We also try and do a very in-depth understanding of white spaces to understand what is it that might do well in the current space. Also, given it's a home product there is a utilitarian element too."
Adds Agrawal, "In terms of business numbers, we have crossed 1,25,000 customers. Over the last couple of years, we have seen 10 times growth. The market is so big and investing in such a small portion of that market, there is a lot of room for us to grow."
Nestasia raised $ USD 4 million in a series A funding in December 2021. On how investors contributed to their brand's journey, says Agrawal, "It kind of helps when external investors also come in and say that, "Yes! We have seen what's happening, we believe in this brand!" It brings a lot of credibility in terms of how people and employees perceive the brand. They also open a lot of access in terms of meeting the right people, getting advice, or access, or even a meeting to understand some business collaboration."
On what do the duo think of having an offline presence, Agrawal says, "It's a complimentary strategy, wouldn't say either is better than the other. That might be a progression which we see in the future. With the growth that we are seeing online, we feel that there's a lot of room in the space that we are at."
On their expansion plans, he says, "By FY25, we want to reach a million households. We are also launching our first set of soft furnishings and travel bags from our in-house manufacturing facility."
- Best seller: Category Dinner Set
- Total SKUs: 6000+
- Team size: 100
- Repeat customer ratio: 60%
- Online platform resulting in maximum revenue: www.nestasia.in. Recently started selling on marketplaces.
- Turnover for FY 2021-22: INR 25 - 30 crore.
- Split between offline and online sales: NA