FASHION RETAILING

COMPARISON STUDY
ON
URBAN LADDER AND PEPPERFRY

Submitted by:
Anandita Dixit
Jennifer Peter
Ravikant Ahlawat
Reisha Shetty
Sudeshna Biswas

National Institute of Fashion Technology Bengaluru

June-December, 2018

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 ACKNOWLEDGEMENT
We would like to express our gratitude to our Fashion Marketing and Retailing faculty, Mr.
Prateek Ghosh. We would like to thank our institute National Institute of Fashion
Technology, Bengaluru that gave us the opportunity to work on this survey with regards to
Marketing of the brands Urban Ladder and Pepperfly.

Signature of students
Anandita Dixit
Jennifer Peter
Ravikant Ahlawat
Reisha Shetty
Sudeshna Biswas

Date: 17th September, 2018.

Place: Bangalore National Institute of Fashion Technology

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 TABLE OF CONTENTS
Sl. No. Page no.
1. Introduction…………………………………………………………………4
2. About the brand……………………………………………………………..4
3. Products……………………………………………………………………..6
4. Segmenting, Targeting, Positioning………………………………………...8
5. Place………………………………………………………………………...10
6. Products in store…………………………………………………………….11
7. Promotion……………………………………………………………….......12
8. Price points…………………………………...................................................13
9. Bibliography………………………………………………………………...13

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 INTRODUCTION

Indian E-commerce is helping catalyze economic growth by creating new business segments,
promoting competitiveness and ensuring the spread of business best practices. By providing
access to markets across the world for Indian manufacturers and craftsmen, e-commerce is
generating new employment opportunities and helping create India’s entrepreneurship
ecosystem.
Urban Ladder is among India’s fastest growing furniture e-retailers. Unlike competitors
which operate as marketplaces, the Bangalore-based start-up owns processes end-to-end,
which means they control everything from selection of wood and designing the furniture to
the delivery of the purchase.

Pixr8.com

o About Urban Ladder

The company started in August 2012, about eight months after Pepperfry. In the last 12
months, the company has grown five times. What makes the company differentiator in the
category is the core focus on the product. But when it comes for the competition, the problem
is not with the vertical players but one need to worry about the competition coming from
Amazon, Snapdeal or Flipkart who already have roughly 50 times more traffic than
UrbanLadder.

The idea of Urban Ladder popped out from the pain point of the founders. While setting up
their homes in 2010, Ashish Goel and Rajiv Srivastava faced difficulties in getting furniture.
The duo kept discussing the problem for a month, but clashed the idea of ecommerce store
around it, as furniture appeared to be a tough category to crack. During 2011, the duo kept
meeting and discussing ideas for their venture, “At that time we thought of having online
store for grocery but ultimately we froze on the idea of selling furniture,” says Srivastava.

Interestingly, they discussed the idea with some investors, who seemed confident about it. It
was December 2011 when both decided to resign from their corporate career to launch Urban
Ladder. “We decided to move to Rajasthan to get a sense about the supply side and it took
four months to spruce up backend such as website development, supply chain and initial

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team,” says Srivastava. The company went live in July 2012, though it had raised $1 million
from Kalaari Capital.

Pressportal.com

Most recently the company raised $50 million in its last round of funding in April 2015, from
Sequoia Capital, TR Capital, Kalaari Capital, SAIF Partners and Steadview Capital making a
total of $77 million in four rounds since starting operations in 2012.The start-up claims to
delivers 125 orders a day with an average ticket size of INR 20,000 making a summation of
9.5 crores in a month. However the company did not disclosed its exact revenue. Goel said,
“We need multipurpose furniture.” One of their best-selling products is the Hamilton Nested
Stool, a set of three stools that fit one beneath the other. “Family structures are changing.
Grandparents are visiting but not staying the whole time. So we’re seeing demand for smaller
shelving units in the guest room,” Goel says.

Source: pressportal.com

o About Pepperfry
In November 2011, Pepperfry.com founded by former-eBay CEO Ambareesh Murty and one
of his former colleagues at eBay, Ashish Shah entered the segment. In its initial days of
launch, Pepperfry had a line of departmental store featuring apparel, bags and accessories,
furniture & home decor, Jewellery and Perfumes & cosmetics.
It featured brands like Lotto, Little India, Peter England, Beverly Hills Polo Club, Octave,
Allen Solly, and L’Oreal among others, and allowed users to browse various departments
using filters for brands, product type, size, color, design and other variables. But later taking
the benefit of the privileged category over the website, the business was fixed to Furniture,

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Home Decor, Kitchen & Dining, etc. However, Pepperfry.com started its operations on
January 3, 2012.
The first round of investment from Norwest highly motivated them which came in just a
month and a half ago before the inception.
Over the last year and a half, the management saw success in the furniture & home decor
category; it contributed to around 80 per cent of the overall revenues. They also noticed that
there were no really large online players in this space. And taking the benefit of the factor,
the business was fixed to Furniture, Home Decor, Kitchen & Dining, etc.

Source: dsim.blog.in

PRODUCTS
The products offered by Urban Ladder are sofas, beds, dining equipments, TV units,
mattresses, seating equipments, coffee tables, cupboards, recliners, storage, study,
bookshelves, shoe racks and a wide range of décor items. Besides all that Urban Ladder is
continually creating and launching new collections like the Malabar, the Eleanor & Louise,
and the Fujiwara range.

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 Source: Urbanladder.com

o Urban Interiors
Motivated by growing customer requests, Urban Ladder also launched and suggestions,
Urban Ladder launched design consultation as a service in 2016.

o The Urban Ladder Design Network

Apart from its in-house collections and consultations, Urban Ladder fosters and works with
external designers The Urban Ladder Design Network programme is an initiative to
connect and build a community of interior designers on one platform. This affiliate
programme provides external designers with 3D rendered models of its products. The
partnered designers also get priority inventory blocking on Urban Ladder’s products and a
commission when their clients select Urban Ladder’s designs for their homes. Currently,
Urban Ladder has over 600 design firms working with them as part of The Urban Ladder
Design Network, with the tribe increasing every month.

o Furniture Exchange
The furniture exchange offer is provided by Urban Ladder’s partners Zefo and Quikr. The
old furniture will be picked up, and the new piece delivered to the customer at no additional
cost.
Products offered by Pepperfry are wide range of furniture items, Décor, wall art, curios and
showpieces, mattresses and bedding, carpets and furnishing, cookware and bakeware, kitchen
appliances, dining and bar items, bath and laundry items, organizers, hardware and electicals.

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 SEGMENTATION, TARGETING AND POSITIONING
o Segmentation
 The Target Customer of Urban Ladder and Pepperfry is anyone who is looking for
furniture in the 4-5 lakh range, including kitchen.
 Anyone in the renovation cycle, who bought a house several years ago but might want
to re-do a room or several rooms within their house is the second audience. And a big
third audience is anyone moving cities among the top 30 cities, who is probably
married but has not bought a house.
 Demographic includes well read, educated, earning well, between the ages of 23 and
45, who will buy online or go to stores accessible to them. They are also design
conscious, socially aware and active.
 However, since Pepperfry provides rental services, it also targets the younger
demographic who constantly move or do not settle in a single household. Based on
research and internal data Pepperfry has identified Furniture Rentals as an additional
growth driver in its journey towards establishing 20 million beautiful homes. As per
the research, the new class of consumers that is participating in the sharing economy
that consists of 22-35-year-old, online-savvy, migrant millennial across the country
can spend upwards of USD 1 Billion per annum on Furniture and related items’
rentals alone. They are in a life stage where they value experiences more than
ownership of physical assets. The furniture rentals business helps them build and
consolidate the franchise among this new class of consumers, thereby helping the
brand tap into not only a new segment but a segment that will grow and contribute
hugely to the core Pepperfry furniture selling business in the coming years. The brand
addresses new segment while creating a solid pipeline of future business.

o Targeting
 Segment Size and Growth - Furniture and Furnishing market in India has been
growing at a compounded annual rate of 6-8%. 80% of the this market is
unorganized, with a large number of unbranded players and local carpenters. The
branded organized retail segment account for 15% of the market and 0.5% of the
market is captured by online retailers, so there is significant headroom for Urban
Ladder and Pepperfry to grow. India’s furniture market is estimated at 93,000-
1,24,000 crore Rs. In India alone.
 Level of Competition – Horizontal players such as Flipkart, Amazon Snapdeal,
Myntra,etc. Urban Ladder and Pepperfry along with FabFurnish (March 2012),
Housefull (August 2006) and Zansaar.com are vertical competition. Offline
competition includes Godrej Interio, Home Town, Fab India, DLF Pure, Lifestyle

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 Home Centre ,etc. One of the biggest competition gearing up to face is Ikea, the
Swedish furniture and Home décor giant.
 Company Objective and Resources – Urban ladder works on design, sourcing and
quality of product when it comes to furniture. Unlike competitors, Urban Ladder
owns processes end-to-end, which means they control everything from selection of
wood and designing furniture to the delivery of the purchase. Due to this,
customization is possible in context to any furniture item bought on Urban Ladder.
Pepperfry has also established the largest Omni-channel business in the furniture and
home segment through its network of 23 Studio’s spread across key cities in India.
Pepperfry managed marketplace helps thousands of entrepreneurs and merchants sell
to millions of discerning customers across India and the world. Most of the current
options that consumers have today for renting furniture are very limited in nature and
scope. There are less than 50 unique designs and are primarily utilitarian in nature
across all the product groups.“The extensive catalog and supply chain that Pepperfry
owns is supported by a robust in-house technology layer. The rental interface has
been made very intuitive and part of the Pepperfry regular check-out flow. Users may
choose to buy or rent as they see fit within the same experience, truly making
Pepperfry a one-stop shop for all things home.”
 Targeting Digitally Savvy, Urban and Design conscious Niche Audience through
technology by launching apps. Urban Ladder provides consultations, home trials and
augmented reality while as Pepperfry promises guaranteed return with no questions
asked.
 Urban Ladder has selected targeting for mattresses in which they segmented
mattresses according to the requirements of the customer like Essential mattresses
(for those who travel constantly), Dreamlite mattresses (for those in relationships),
Theramedic Mattresses (for extra back support), Cloud mattresses (Extra soft and
comfort) and Bounce Junior mattresses (for kids).
 Both, Urban Ladder and Pepperfry have launched new ranges for kids only. Coloured
in whimsical and pastel colours.

o Positioning
 Urban Ladder intends to complete home solutions provider in the coming days. They
want to mature from an online furnishing store to a one-stop home furnishing
provider. To position themselves, urban Ladder recently jumped into TV, but its
initial efforts were focused on broad-reaching demography. Founders believe organic
growth occupied with social media marketing and positive word-for-mouth are
sufficient for them. Urban Ladder also broadens its base by filming ads or share
stories that visualizes evolution of a beautiful home, brand campaigns “bring you
closer” aims to highlight emotional undertones that Urban Ladder adds to the home.
The new online campaignhas 4 short videos featuring pets, and aptly titled “Creature
Comforts”. Urban Ladder also has CSR initiatives in which a customer gets a 10%
discount if they opt for the exchange offer. Through Milaap, Urban Ladder has
partnered with 11 NGOs who give this old furniture to those in need.
 In October 2014, Pepperfry tied-up with Satchi&Satchi to release its first television
commercial with “Happy Furniture to You” as its unique brand proposition. It was

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 spread across radio, digital, outdoor and social platforms like Google, YouTube and
Facebook. The company has launched a series of successful campaigns in the last
few months. The company has tied-up with HomeStop to launch the first Shop-in-
Shop concept store in the category called “Pepperfry Live” at their Ahmedabad,
Chennai and Mumbai outlets with similar store openings at various other HomeStop
outlets. It also has pop-up stores at Mumbai, Delhi and Bengaluru airports. Pepperfry
partnered with Rajasthan Royals in IPL 2015 to promote the brand name and increase
engagement and sales.

PLACE
Bangalore being the Silicon Valley of India as it is the tech hub for many well-known
companies and hence it's population has increased from 8.5 million people (in 2011) to 10.1
million (in 2014).

In our study, both, Urban Ladder and Pepperfry stores are situated in HSR Layout which one
of the developed places in Bangalore and nearby to many tech hubs like Accenture (3.4 Km),
HCL (6 Km), One of the important variable for the success of a product is the place as it is
important of being aware of who is your target audience. HSR also happens to be one of
most developed part of the city with respect to it’s corporate offices and upcoming housing
complexes.

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HSR fits exactly into the target market of Urban Ladder and Pepperfry. The stores are
surrounded by upcoming housing complexes and residential quarters. HSR has a population
of urban, design oriented youth such as NIFT college which is right across the road and
various interior design studios down the road. HSR includes demographics that fit into the

target customers of Urban Ladder and Pepperfry such as 23-45 year old people who are
working in the corporate sector and need immediate access to convenient services such as
furnishing stores.

But due to the close proximity between the two stores there's high competition between the
two as if a customer may want to take a look in the pepperfry store nearby before buying a
product from Urban Ladder or vice versa.

PRODUCTS IN STORE
Urban Ladder products are aesthetically pleasing and have guaranteed quality. Urban Ladder
products are handpicked by the management after all the checks. All products are made in
collaboration with the design team in consideration.

For example: oak finish Akrita bench, Honey oak finish Esvelt arm chair, etc.

Pepperfry is more like a marketplace where anyone can list and sell. It has less variety of
custom products like dining table, shoe rack,etc.

Hence, if compared prices of Urban Ladder are higher than Pepperfry.

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 PROMOTIONS

Urban Ladder’s use of customer testimonials and responses as a marketing tool is a

benchmark for the category. The most successful businesses convert their customers into
brand ambassadors and sales force and in effect this is what Urban Ladder has achieved. It
has also ensured that this element retains the high emotional connect that buyers retain after
their shopping online. Urban Ladder’s marketing campaign is that it was a straightforward,
honest and sincere exposition of customer feedback. Urban Ladder’s campaign has an
interesting take home in the form of the manner in which social media platforms were used.
While most brands look at each channel as a unique and individualised platform and
customise messaging and marketing efforts for each, Urban Ladder integrated all the
mainstream social media platforms into one route to channel testimonials across the board, to
land up on one spot. We find that Urban Ladder’s overarching emphasis on driving
engagement with genuine users has worked very well in their favour. Every channel used –
be it social media, email or the Urban Ladder kiosk at airports for that matter, the driving
guideline is to allow prospects and customers to engage with the brand in some way. Rather
than dilute the interaction to mere discounts or deals, the effort taken to deliver greater value
to the prospect has ensured that the brand has built a community of customers and users. This
definitely augurs well for a long-term relationship with customers, who stay loyal and retain
their involvement with the brand.
With respect to the Visual Merchandising in the store, the Urban Ladder store has a neon
Orange grill around it which is very eye catching and adds a urban and modern aesthetic to
the store. The store has a discount of 30% on certain products due to the arrival of the festive
season. The inside of the store was aesthetically pleasing. The products were in full display
according to their room requirements. The store has an overall contemporary Indian aesthetic
which is very suited for the urban youth.
The pepperfry store had a discount of 50%. The overall VM of the store was westernized
with touches of Indian culture such as a glass top sleek dining table with earthen chai cups.
Unlike urban ladder, Pepperfry had included a modular kitchen in their store.

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 PRICE POINTS
Urban Ladder has close to 4,000 items. They have wardrobes starting from Rs 3,999 to Rs 1.5
lakh. Their products are a little more on the higher end. But for the quality, its pretty good.
Urban Ladder can cater to both a BPO employee and Shah Rukh Khan. Anyone who is
between 25 and 45 years of age and is in the home-making stage would buy.
Urban Ladder boasts the highest funding among its peers. It has got some $78 million, and a
personal investment from Ratan Tata, Chairman Emeritus of Tata Sons. In fact, the
investment by Tata is seen as the biggest breakthrough for the company. Urban Ladder
claims to sell items with much higher average ticket size than others. For example, its ticket
size is Rs 20,000 as compared to Pepperfry'sRs 14,000.
Pepperfry's inventory is huge due to the non-furniture items that it sells (some 70,000 SKUs)
whereas Urban Ladder has only recently launched non-furniture categories such as carpets
and lighting.Pepperfry works with small artisans and handicraft makers in Rajasthan, and
helps them in negotiating price to procure raw materials. Besides Rajasthan, the e-tailer is
evaluating the Northeast (for sourcing Rattan and cane furniture), and Pondicherry and
Kerala (for rosewood furniture).The focus is also to keep shipping costs under control.
Pepperfry's average logistics cost per item used to be Rs 3,000, which has gone down to Rs
450 now.

BIBLIOGRAPHY
 http://dsim.in/blog/case-studyhow-pepperfry-occupied-indian-market-as-indias-
largest-home-shopping-destination
 Urbanladder.com
 Pepperfry.com
 www.mbaskool.com/brandguide/it-technology/pepperfry.html
 http://inception.net.in/case-study-urban-ladder
 http://shodhganga.inflibnet.ac.in/bitstream/10603/16744/8/08_chapter1.pdf

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