Online furniture player Urban Ladder is looking to reach operational profitability in the next 9-10 months and full profitability in the next 24 months.
The etailer that witnessed 30% month on month growth in sales has been expanding rapidly compared to other players. Encouraged by its positive growth trajectory, Urban Ladder has mapped out plans to touch profitability in 2 years.
“We are trying to drive efficiency in every part of business. Everything from pricing to the product portfolio is rationalised. We are working with a world-class consulting company to make sure that the inventory, from our suppliers’ perspective, is well thought through,” said Rajiv Srivatsa, Co-founder & COO, Urban Ladder.
Here’s how the firm plans to do it.
Focus on New Homes Business and Automation
The furniture etailer wants to concentrate on building its newly introduced kitchenware, wardrobes, and interior design category. After setting up a team in the last year and a half, the firm plans to automate the whole buying & installing process with the help of technology in the next 12-18 months.
“The focus is this because it’s almost like running a second business. Everything is very different: products, material, the selling process, the installation and delivery…. If the new business now contributes to 10 per cent to our total business, might contribute 30 per cent by the end of the year,” asserted Srivatsa.
Focus on Customer Satisfaction and Experience
With IKEA coming to India, Urban Ladder is counting on its loyal customers to stay relevant and ahead amid stiff competition. Therefore, the etailer’s main goal is to build & expand that loyal customer base before new entrants enter the market.
Srivatsa shared, “We have a team which is really strong in driving consumer satisfaction. Urban Ladder has been known for its customer satisfaction score. Now, there is international competition and horizontal entrants into the sector…. We need to concentrate on loyalty and referrals, and keep customers engaged beyond their first purchase.”
Focus on reducing unnecessary costs
Almost all ecommerce players including big marketplace like Flipkart are cutting down unnecessary costs to become profitable. Urban Ladder is no different. The furniture etailer has stopped spending on TV ads. Instead, the firm relies on the digital medium for promotional and marketing activities.
“We are cutting a lot of wasteful expenditure. For example, we have completely cut TV advertising; now, we stick to digital. We’ve brought down advertising and marketing costs by almost a third,” stated Srivatsa.
The distant dream of profitability
Besides Urban Ladder, several other ecommerce players are nurturing the profitability dream.
Will any of the ecommerce players achieve their target? Who will the first one to do so? Or are these just tall claims with no substance?