Bengaluru-based Sunday banks on sleep, eyes a share of the $3.5B mattress market in India
The idea of a 'sleep startup' occurred to Alphonse Reddy in 2011 when he started Fabmart, a sleep marketplace which continued till 2014. While running Fabmart, he realised consumers today are not happy with the current mattress buying experience.
One has to go through the conventional experience of choosing the product from numerous models with little differentiation. There was a lack of unified pricing as well, as most brands were focussing on discount model which left a lot of consumers with a poor buying experience.
Alphonse figured out the huge gap in this market and finally in mid 2014, he started working on Sundayrest and it took one year to validate the idea. Sundayrest was bootstrapped initially and after one year, seed capital of $250,000 was raised from Anand Morzaria and other Co-founders of PennyWise Solutions Private Limited - a digital services company acquired by Ogilvy & Mather in 2013.
We went through the same journey as most startups do, right from challenges with hiring, managing vendors, product development, and marketing etc. Additionally, our aim was to build a sustainable business than just focus on the top line. With limited capital, we had to survive and compete with well-funded startups. Luckily, we have a great team which helped us grow our business in a very competitive space.
Product development stage
There are, typically, three types of layers in a mattress-comfort layer, support layer and base layer but according to Alphonse, one can end up with about 30 different combinations. Sundayrest built a modular bed where they could quickly create a prototype mattress from any of the 30 combinations.
Alphonse says, "Once we had narrowed down our choices, we managed to engage customers from Hyderabad and Bengaluru in winter of 2014 and summer of 2015 and tried these mattresses with different categories -- gender, weight, height, back conditions, and pregnancy etc."
Design is considered as an integral part of the product development and design is not about how the product looks but how it functions. For example: given the Indian climate, sweat marks on mattress are very common. Therefore, keeping that in mind, Sundayrest developed the mattress with a removable zipper cover for easy maintenance.
Alphonse says that when it comes to material, the 100 per cent latex is sourced from advanced robotic factories based out of Belgium. The entire fabric used for the mattresses is Oeko-Tex 100 certified, which is basically an internationally acclaimed certification to make sure there are no harmful remnants in the fabric.
The flagship model of Sundayrest, LatexPlus, passed LGA certification (which stands for longevity of the mattress) from Germany and scored a 99/100. The startup procures most of the raw materials from European countries and the final manufacturingand assembly happens here in India. Moreover, Sundayrest mattress is designed by acclaimed Japanese designer, Hiroko Shiratori.
"Going forward, we would look at local sourcing as much as possible. For now, the focus is on unparalleled quality of products,"Alphonse explains.
Currently, Sundayrest has two types of products Ortho Plus mattress which is priced at Rs17,990 and Latex Plus mattress which is available at a price of Rs 34,490. On the price differentiation, Alphonse says a latex mattress (even an uncertified one) in the market costs about Rs 75,000 to Rs. 80,000.
"It is easy for us to hike up prices and offer discounts but we do not want to do that as it is unfair for customers who do not have the time to bargain or scour the web for discounts," he adds.
Though not much is spent in digital advertising, the startup market its products through TV, newspaper, Out-Of-Home advertising and more.
The startup has tied up with Shippr and Portr for delivery of products. For Bengaluru, Sundayrest has a policy of same day delivery whereas for other cities, the mattresses get delivered within a week. Sundayrest offers hundred nights risk free trial with which customers can get a full cash refund if they are not happy with the mattress.
So far, we have sold more than 1000 mattresses. And we have witnessed 50-100% growth month on month in terms of orders that we receive from the customers.
Currently, Sundayrest has a team of 10 people for technology, finance, marketing, design, marketing and logistics. And for the production of the mattress, the startup has outsourced 100 people which according to Alphonse is one of the efficient ways to save money.
The team comes with collective experience spanning across companies such as Fabmart, Flipkart, KFC, Peter England, Delta Partners, etc., and with educational degrees from institutes such as BITS Pilani and INSEAD, France.
At present, Sundayrest has one 'experience centre'- Sunday Sleep Lounge - in Bengaluru and it is planning to open three to four more in the coming months. The startup is also planning to expand to Hyderabad, Chennai, Kochi followed by Mumbai, Pune and Delhi. And each of these cities will have three to four experience centres each.
According to Alphonse, the current size of the mattress market in India is $3.5 billion which he has estimated by accumulating the market shares, size of the large brands and the percentage that the mattress segment holds in the entire home furnishing market in India.
The market at present is largely driven by the unorganized players. Players like Kurlon, Sleepwell, Springfit, Springwel, Peps and others make up a very small part of the overall market.
Sundayrest, merely a one-year-old startup, has entered into such a fragmented and competitive market with a strong appetite to make space for itself.
It is interesting that the startup is aiming to acquire 10 percent market share of the entire mattress market in India in the next three years. This itself is an uphill task considering the global and Indian majors the startup will have to compete with. The startup is also targeting a global market, estimated at over $23 billion by P&S Market Research, and plans to expand to the Middle East and Australia.
Finding the right price-and-market fit will determine this startup’s success.
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