How Home Decor E-marketplaces are Relying on Brick and Mortar Models for Revenue

While e-marketplaces always have great deals to offer, they face a major challenge in convincing customers about the quality

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One always remembers the joy of having a new piece of furniture at home. From shuffling all other pieces to give the new one its rightful space to redecorating the room for matching the colour of the new piece of furniture — haven't we done it all?


Furniture or home decor is always looked at as a piece of investment. So, when the furniture started getting available at online marketplaces, there were usual, initial hiccups — how do I ensure the quality of product?

While e-marketplaces always have great deals to offer, they face a major challenge in convincing customers about the quality.

This precisely brought about the concept of experience centres. Online stores are shifting to their brick and mortar counterparts to increase the revenue and build the trust factor among consumers.

Buying Furniture has an Emotional Side to it

For someone who is building a new home, furniture becomes an integral part of making their house a home. Consumers usually think a lot before they invest money in home decor. MyGubbi, which recently raised $2.5 million Pre-Series A funding, caught the feeling of its customers very early on. They knew that buying furniture was part of the emotional journey for the customer.

"Our experience centres were born out of this need to give our customers a place to interact with the company — give a face to the name. With the help of this experience centres, they are able to touch, feel and gauge the effort and love we put in making their homes beautiful," said Ravi Rao, Co-Founder, MyGubbi.

The Resultant Higher Revenue

Most online marketplaces have developed experience centres where they can actually check the product. Pepperfry was one of the first to open these experience centres called Pepperfry Studio. Today, these studios are present in 11 cities, where customers don't just come for reassurance but also get design inspiration by interacting with their designers.

"A lot of Indian consumers are ready to buy furniture online and we have seen that happen in the past few years. But there are many more people out there, who require touch and feel to take that decision and we realize that consumers are at different spectrums of evolution in terms of sophistication in the online medium," said Kashyap Vadapalli, Chief Marketing Officer, Pepperfry.

According to their record books, almost 50% of people, who walk in to their studio, place an order within six weeks. Physical stores corner more expensive orders: if it's INR17,000 to INR 18,000 on site, it's over INR 50,000 in store. "Interestingly, 85% of what's ordered is not even present in the store," he said.

Another start-up in the interior design space, Livspace, opened its pilot design centre in Bengaluru in 2015. Over the last two years, they have opened three other Design Centres in Bengaluru, Mumbai and NCR. The company registered a 40% higher average conversion rate across all cities because of enhanced customer experience, thanks to our offline presence.

"We also gathered feedback from customers, who unanimously said they wanted more design ideas, a true-feeling of experiencing their home design, more technology integration to visualize the space, and extensive material libraries to select from, in order to reduce time-to-purchase," said Anuj Srivastava, CEO of Livspace. They have so far invested INR 25 crore and have plans to expand the network of Design Centres and add more smaller units by 2018.

Customers Prefer Omni-channel Experience

With multiple approach to sales, start-ups are being able to not just grab the attention of the "new media" consumers but also that of the traditionalists. Thus, these start-ups are able to reach a wider audience. According to Srivastava from Livspace, it is important for companies operating in a high-disruption potential space, like home design, to have an innovative, well-integrated online to offline format.

"That will ensure sustained growth and market leadership. The need of the hour is to integrate experiences across channels through an omni-channel approach. With our offline presence, our customers now get to see the picture-in-reality through our curated looks at our Design Centers. They can go through our vast material catalogues and even experience their home design in virtual reality," he said.