Pepperfry is targeting significant double-digit growth in 2024-25: Kushal Budhia

Pepperfry, one of the leading ecommerce platforms for Furniture and Home Goods, has unveiled a compelling narrative in its Home Beat Report 2023. Based on all transactions made on the platform from January 1, 2023, to December 11, 2023, the Pepperfry Home Beat Report 2023 provides interesting insights into consumer trends as well as the home goods purchasing habits of Indians from different states and cities of the country.

According to the report, Maharashtra led the demand surge for Furniture and Home Goods among Indian states in 2023. The other states that feature among the top five for buying Furniture and Home Goods in 2023 were Karnataka, Tamil Nadu, Uttar Pradesh and Delhi.

In conversation with Adgully, Kushal Budhia, Chief Category Officer, Pepperfry, shares some key insights from Pepperfry’s Home Report Card 2023, the company’s expansion plans, insights into the new products or categories. Budhia also speaks about how Pepperfry’s marketing and communications strategy has evolved over the years, as well as their focus areas for 2024.

Could you share some key insights from Pepperfry’s Home Report Card 2023?

If you look at the markets, the higher consumption of online furniture seems more prevalent than in cosmopolitan markets. The reason Bangalore, Mumbai, and Delhi are top places is due to the growing service industries, attracting people who are relocating. Consequently, they seek options where they don’t have to compromise on the quality of furniture. They want furniture comparable to what they could get in their hometowns, but with the added convenience of quick delivery – within 24 to 48 hours. Almost 70% of our deliveries in these cities are completed within 20 hours. This trend suggests that similar markets will likely develop in emerging cities. Today, Gujarat is gaining attention for development, indicating potential future markets. As more service industries emerge, there will be increased demand for online and organised furniture.

From a product standpoint, climate and constraints go hand-in-hand. For instance, sofa beds may sell more in Mumbai, while eight-seater dining sets may be more popular in Hyderabad. This correlation is influenced by cultural preferences and physical constraints in these locations. In terms of home decor, we observe that Delhi has a higher demand for whiskey glasses. This consumption pattern reflects our nation’s preference for whiskey over beer or wine. Given our diversity, it is crucial to provide a variety of options for consumers. A marketplace becomes the solution, offering everything to everyone on the same platform.

With Tier 1/2 markets emerging as growth drivers, how does Pepperfry plan to expand its presence in these markets?

I see that from an online standpoint, everyone is able to consume. So, I believe it is important to conduct consumer behaviour studies for each market, similar to how we have studied Bangalore, Hyderabad, Delhi, and Mumbai. I think delving into consumer behaviour in urban markets would reveal interesting insights about their preferences. There is still a lot of opportunity in terms of offering specific products tailored to the consumption patterns of these places. These could serve as growth opportunities, but it is crucial to establish brand trust. Our presence in these markets through our studios has built trust, and many people are consuming our products. However, further growth will come from more people embracing our offerings and us providing specific products for their respective regions.

Given the growing trend of consumers focusing on home design, how does Pepperfry foresee the growth of the Home Goods category, and what strategies are in place to cater to this demand?

I believe it is a fashion-driven category that revolves around variety and the frequency of design changes. We have a team of designers dedicated to staying abreast of the latest trends in the industry, keeping an eye on developments in the home decor markets in India, Asia, and worldwide. Their focus is on ensuring that relevant and contemporary products are consistently available on our platform. Additionally, having all the top national brands featured on our platform ensures widespread product availability to consumers. Today, when we discuss the leading brands in home decor furnishings, you will find them showcased on our platform.

You mentioned Pepperfry being at the forefront of product portfolio expansion. Could you provide insights into the new products or categories that Pepperfry plans to introduce to meet evolving consumer preferences?

Some of the things, especially in furniture, fall under product categories. How can we make them more usable? For instance, we have introduced a folding dining table. The chairs also fold and can be stored inside the dining table itself, effectively turning it into a small shelf or console table when closed. When you want to use it, simply open it, and it transforms into a functional dining table. I believe enhancing the utility of the product will be a significant win for consumers, particularly in places with space constraints or for those conscious about costs. At the same time, we offer them solid wood furniture or the character they desire for their homes.

What will be Pepperfry’s focus areas in 2024? What kind of growth are you targeting this year?

We are obviously targeting significant double-digit growth in 2024-25. The key focus areas include ensuring entry into more markets, capturing additional market share in the organised segment, and gaining traction from the unorganised sector. We’ve observed a trend where many of our consumers are ordering furniture for their homes from our platform, with deliveries extending to tier one and tier two cities. Effectively, what we conclude is that they initially order furniture for their parents from our platform in metro markets. This trend is gradually expanding from metro markets to Tier 1 and Tier 2 cities, driven by positive experiences, as they encourage family members to make purchases from our platform.

Could you take us through how Pepperfry’s marketing and communications strategy has evolved over the years? What is the company’s vision in the current year?

From a marketing standpoint, I believe what stands out when creating brands is product reliability and the service provided. As a services company, we focus on offering and setting up homes, along with providing after-sales service. This aspect is crucial for brand building. We utilise various channels for brand promotion, including TV ads and online platforms such as YouTube. Last year, we featured Saif and Kareena as our brand ambassadors, with recordings broadcasted across major metros. We heavily invest in performance marketing, with a dedicated team ensuring our presence on all social media platforms. Our Pep Homies Club engages influencers in the home and decor category, allowing us to showcase our products. Our goal is to generate content and build a community, ensuring that the brand remains relevant to all consumers.