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Indian D2Cs’ Festive Play: Countering Challenges & Growing Beyond The Diwali Rush

SUMMARY

Ecommerce platforms clocked sales worth $5.7 Bn in the first week (September 22-30) of the festive season this year

Brands like The Baklava Box and Wellcurve experienced a major surge in their sales in Diwali this October, the founders told Inc42

To sustain the current momentum, 3PL firm Pickrr’s CEO Gaurav Mangla advised brands to minimise impulse buying, reduce redressal time and properly understand one’s product and market

“After the last two years of lockdown, I see a lot of pent-up demand. In fact, since September (2022), we have seen a huge rise in corporate and personal gifting. We expect this festive season (till December) to be at least four times what it was last year,” said Vatsal Agarwal, founder of Kolkata-based The Baklava Box, which sells authentic Middle Eastern desserts across the globe through offline and online channels.

All celebrations (festive or otherwise) were marred and muted by the pandemic since 2020 as the country struggled to cope with the new normal. But after the initial collapse, even lockdowns and restrictions had a silver lining of sorts. As consumers preferred to shop from the safety of their homes and needed doorstep deliveries, ecommerce brands across the country witnessed robust growth. 

The tectonic shift in retail shopping – from offline to online – has continued. According to consultancy firm Redseer, ecommerce platforms clocked sales worth $5.7 Bn in the first week (September 22-30) of the festive season this year.

Being new to the market when Covid-19 wreaked havoc, Delhi-based wellness brand Wellcurve decided not to be a part of the raging bullfight — with big ecommerce and retail brands — last year. This year, however, the brand launched three festive season sales at the beginning of October. It bagged 5x more orders in those 10 ‘sale’ days compared to the entire festive season of 2021, founder and CEO Nikhil Mehra told Inc42.

As Diwali sales soared in October this year, Wellcurve saw 100% increase in sales as compared to last year, the founder told Inc42.

This does not mean their journey has been smooth.

Although The Baklava Box witnesses a 250-300% surge in orders during festive times (until Christmas) compared to the rest of the year, this often leads to crammed and, thus, delayed deliveries, according to Agarwal.  

“Generally, our turnaround time is one day. But during the festive period, it becomes three to four days. At times, the packages are lost, or they are not delivered on time, stretching things out to 8-10 days,” he said.

This can affect a brand’s image and sour its relations with customers when 10-minute deliveries through quick commerce (Qcommerce) operators are becoming a way of life. But brands today are agile enough to hop ships and maintain scale. So, Baklava Box and its ilk started pilots with (Zomato-owned) Blinkit and (Swiggy) Instamart just before Diwali.

“Apart from online order-taking on our website, we have 10 cloud kitchens in all metro cities in India. We are also starting a pilot with Blinkit for quick delivery in Gurugram and Bengaluru,” added Agarwal.

Thanks to this, this Diwali week brought 5x the brand’s regular sales and 2x of the last year’s sales in the same period.

Ensuring fast shipping and efficient inventory management have become all the more crucial today with brands striving to hop on the Qcommerce bandwagon.

According to the leadership of the third-party logistics (3PL) company Pickrr, forging partnerships with 3PL players such as itself can help brands deal with delivery delays and other common logistics problems — especially during the festive rush.     

The spokesperson further went on to add, “Pickrr has been helping and will continue to help streamline the logistics needs of D2C and ecommerce brands. From route mapping and shipping to inventory control and warehousing, last-mile efficiency, RTO (return to origin) resolution and more – everything comes at competitive pricing.”

D2C Brands’ Festive Rush 2022 & The Plans Ahead; 3PLs To The Rescue?

In a retail world where the customer is king, everything begins and ends with them, said Mehra of Wellcurve. It includes everything working for the customer, from AB testing of UI/UX to website / product design to delivering personalised customer experience.

This has been made easier as brands today heavily leverage omnichannel customer engagement for communication, consistency and convenience. A case in point is WhatsApp, which started as a user-friendly communication tool, but rapidly turned into a growth channel for businesses. According to several studies, 84% of Indian SMEs affirm that WhatsApp facilitates easier communication with clients, while 80% believe it helps them build their businesses.   

While multiple channels and solutions can ease the connection between the brand and the customer. At heart of the customer experience is logistics, which can ensure a seamless customer journey through fast and error-free delivery, real-time information and quick issue resolution.    

“This festive season, brands are trying to provide a more personalised experience to customers. So, we have seen WhatsApp conversations picking up. As per our experience, it helps brands improve net promoter score (NPS) as more than 70% of the consumers respond readily on WhatsApp. The other focus is same-day and next-day deliveries (SDD and NDD),” said Gaurav Mangla, CEO and cofounder of Pickrr.

Mangla revealed that since September 2022, Pickrr has added more than 50 D2C brands to its client portfolio (with SDD and NDD requirements) and is looking at completing 12 Mn orders in the OND (Oct-Dec) quarter this year. It is more than double the 5.5 Mn orders completed by the startup in the same quarter last year. 

Indian D2Cs’ Festive Play: Countering Challenges & Growing Beyond The Diwali Rush

Although Agarwal is running pilots with Qcommerce players, The Baklava Box has also shipped its products through Pickrr to fulfil its website orders that required same-day and next-day pan-India delivery.

However, with the rise of horizontal sales during the festive period, the delivery network of courier companies gets choked, impacting the overall delivery experience. The Pickrr CEO believes that in such cases, it is essential to inform customers about the delay. Also, one must not overcommit and underdeliver, added Mangla.

Timely communication with customers and keeping them in the loop are critical during the ‘rush’ as issues like cart abandonment, RTOs and reduction in NDR (net dollar retention) tend to rise in frequency and magnitude.

To minimise the impact, brands leverage internal teams and external partners like Pickrr and use WhatsApp as an effective communication channel. For instance, when orders cannot be delivered at first go, customers receive WhatsApp messages from brands/delivery partners who confirm the date and time of the next delivery slot. This also helps companies counter fake delivery attempts.

Logistics players like Pickrr also advise their partner brands to proactively confirm cash-on-delivery (COD) orders to cut down on frauds and scams. 

“Working closely with partners like Pickrr helps us improve delivery experience, reduce returns, drill down to pin code levels and understand the challenges on the ground,” said Mehra, iterating Dinodia’s views. 

In a bid to become a single touchpoint between brands and customers, Pickrr is providing data and insights to help businesses improve their delivery and thus enhance customer experience. It also alerts brands about risky pin codes (more prone to scams/frauds) and recommends most suitable courier partners for specific locations.

“We are constantly monitoring the lanes – impacted versus efficient lanes – and trying to ensure that the client gets the best service out of those lanes even if our margins are hit,” said Mangla. 

He recalled how Pickrr made proof of delivery (POD) a mandate for all courier partners through WhatsApp, IVR (Interactive voice response) calls and more to help brands cope with issues like fake delivery attempts.

Engaging With Customers Post The Diwali Hype

“As a mandate, eight people from the team speak to two customers each, everyday. Where we record their feedback on both commerce and content side of things. I speak to at least one brand founder every week, my aim is to unravel what we are doing wrong & how we can be better,” said Mehra.

As the Diwali hype dies down, brands look forward to monetising newfound customers and sustaining the momentum for the rest of the year. In simple terms, engaging with customers becomes critical at this point to ensure long-term retention.  

For Wellcurve, a smooth UI/UX, a brilliant design — website, product, promotions and more — or a seamless experience on the website is not the ultimate trigger that will bring more business. What matters most is having meaningful conversations with one’s customers. 

“You will never know if something is working or not until you have talked with the users,” explained Mehra.

But meaningful customer engagement is easier said than done. Despite omnichannel opportunities, brands struggle for visibility and spontaneous recall as customers are now spoilt for choices. But for early-stage brands, this can be resolved a little differently.

Mangla and Mehra advised brands to experiment with sampling. Once the product, pricing and positioning are set, brands can target their customers by sharing product samples and moving away from the lure of impulse buying.

“Impulse buying should be minimised. A lot of brands build their businesses on impulse buying. Although it provides higher returns, it occurs for a short period, and customer loyalty is low. Again, brands must try to reduce redressal time and properly understand their products and customers. These are non-negotiable,” said Mangla.

This is especially true for brands doing cross-border business. Agarwal, who sells products worldwide with help from Pickrr, thinks having partners in the market who understand your brand, customers and market sentiment are vital for growth.

Meanwhile, this quarter’s focus will undeniably be on creating campaigns based on festive moods, current trends and a deep understanding of consumer preferences, as brands aim to fulfil festive expectations and surpass growth targets.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.

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