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Nestasia, a home decor startup that survived Covid

The home decor industry in India is undergoing a major transformation on the back of the growing D2C wave in the country. Ten years ago, when D2C was not the norm, home furnishing was all about buying local products or buying from premium offline stores. Then came the online shopping boom, with brands like Pepperfry and Urban Ladder entering the fray. But as these brands are keen to grow, they have invested heavily in moving offline. From 2018-2019, D2C brands such as Trampoline, Chumbak and The Decor Cart emerged, maintaining consumer appeal with diverse home decor solutions such as eco-friendly products, garden decor, bath essentials and kitchen utilities. It was during this time that Nestasia emerged, aiming to bridge the gap between low-quality local stores and high-end boutiques by offering a fresh perspective on home decor. Founded in 2019 by Aditi Murarka and Anurag Aggarwal, Nestasia is a home decor brand that offers products such as decor, bath, crockery, garden accessories and kitchen utilities. Unlike other marketplaces, the Kolkata-based startup runs a complete D2C business, buying products from Indian artisans and selling directly to consumers. It is primarily sold on Amazon and Myntra and is also available on TataClick, Pepperfry and Nyika. Starting with 100-200 products, the D2C brand now offers around 4,500 items across six categories and currently fulfills more than 3 lakh orders. According to Toffler, the company's operating income grew 63.8% to Rs 35.88 crore in FY23 from Rs 21.90 crore in FY22. The startup has raised $4 million from Stellaris Venture Partners. Before founding Nestasia, Aditi Murarka, an XLRI Jamshedpur alumnus, worked as an associate manager at Salora Group in Singapore. This work forced them to travel frequently between Hong Kong and Singapore. During their four years living outside India, they had to move house more times than they can remember. However, they always enjoyed arranging and decorating the abode. Thus Murarka developed a deep passion for home decor products and hence decided to take it up as a full-time career. They wanted to build a brand that offered unique, contemporary and premium quality home decor products. After a year of research, Murarka returned to India in 2019 to pursue his vision. That same year, she launched Nestasia, capitalizing on the rise of e-commerce and increased interest in home decor. Agarwal, who previously worked in equity trading at Goldman Sachs, joined his wife in early 2020 just before the start of the Covid-19 pandemic. Initially they started with a small team and the husband and wife relied on their savings to bootstrap the venture. So, the co-founders decided to fine-tune their assortment, from 10,000-12,000 SKUs in 2023 to around 4,500 SKUs in 2024, ensuring that each product is design-driven and of high quality. The cofounders later decided to launch home decor products for seasonal and special occasion launches. A combination of seasonal and design-driven approach became the brand's USP. The impact of the pandemic Four to five months after it started, the Covid-19 pandemic hit the world. During this time, Nestasia's supply chain was hit hard, making it nearly impossible for the co-founders to fulfill customer orders. With imports disrupted and delivery services halted, the team often had to pack and ship products themselves. Another major challenge faced by the brand was the gap between running out of stock and getting replenished. "To maintain customer trust, Anurag and I personally called each customer who placed an order to explain the delay and assured them of eventual delivery," Murarka said. This first approach led to the creation of an in-house team producing high-quality content, which led to 15% referrals and conversions from social media. This was also the time when Nestasia got its first 100 orders. Nestasia's product folio According to the co-founders, the startup has succeeded in positioning itself as a major home and lifestyle product destination. Offering a wide range of products from dining ware and kitchen essentials to decorative items such as candles, mirrors, bath accessories, soft furnishings, bags and accessories, the startup aims to become a company that sells everything for the home. Converting to a design-driven focus, the startup launched visually appealing lunch boxes in 2023, catering to demands for quality and beauty. This success led them to expand into other offerings such as shopping bags, organizers and vanity boxes. Currently, the co-founders have an in-house production unit for bags and accessories in Kolkata. The startup's bags and accessories segment accounts for around 18% of its total revenue. The journey ahead With the online market expected to grow to $5.4 billion by 2025, the home decor industry is expecting a remarkable shift. To capitalize on this opportunity, the startup is focusing on growth strategies such as optimizing product distribution, reducing logistics costs, and expanding. Presence across all channels and significantly increases offline expansion. The startup, which currently operates five stores, aims to open five more stores this year and reach around 40 stores by next year. The cofounders have already finalized deals for upcoming locations, targeting Aria Mall in Gurgaon, DLF Mall of India in Noida and potential sites in Pune and Mumbai. To facilitate this expansion, the cofounders are experimenting with store size, assortment and locations to improve the customer experience. In the home decor segment, the startup competes with companies like Trampoline, The Purple Turtles, Chumbak, Vari, Pepperfry, Furlenko and Urban Ladder. Additionally, the startup aims to offer a seamless online-offline shopping experience by allowing customers to pick up online purchases from the store and vice versa. The startup is working on increasing convenience and flexibility for shoppers by implementing loyalty programs and enabling customers to place orders through their app for home delivery.

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Jeroj

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July 5, 2024

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