WWW: Winning the Women on the Web
I do a good part of my shopping online. I find buying online easier and it gives me a better shopping experience. From an Iron box to tea kettle, from organic food to clothes and jewelry, from furniture to shoes I am game to order what I need online.
I am not the only one. Online women shoppers in India is a steadily growing segment. By 2016, this number is expected to reach 40 million. According to a Google and Forrester Consulting survey, women shoppers in tier 1 cities outspend men by approximately two times. There is no denying the fact that they are emerging as major growth-drivers for eCommerce in India.
We shouldn’t be surprised by it. The trend started in advanced economies, United States and Europe, a while ago. Higher employment rate among women, longer history of female workforce, deeper internet penetration have led to a thriving marketplace targeting women. There are general eCommerce sites where women drive most sales including Zappos, Gilt Group, Etsy and Groupon. And there are platforms that exclusively target women. For example, e.l.f. Cosmetics, Boden, and Stella & Dot.
In the west, it’s widely acknowledged that women as a segment drive retail in general and eCommerce in particular. Women account for 83% of all consumer sales in the US, and spend about $4 trillion every year, according to a report by WomenCertified, a retail training organisation in the US. This is reflected online too. According to Comscore, women account for 58 % of all online sales, and decide 83–87% of consumer purchases.
Not only do they drive sales, their shopping behavior is different too. A study in UK showed that more women use smartphones to buy online than men. Price mattered more to women than to men, and women are more likely to use coupons to buy compared to men. More importantly, it’s about how they shop. While men go to a shop with a clear idea of what they want to buy, pick them up, pay the bills and walk out, women like to immerse themselves in shopping experience, take time to explore the right product, with the right color, right texture, and deliberate on their purchase. Men buy, women shop.
The eCommerce market for women didn’t just develop by accident. It was developed by entrepreneurs doing the hard stuff. One of my favorite examples is Birchbox. It was founded back in 2010 by two young Harvard Business School grads Katia Beauchamp and Hayley Barna. And their trigger was their frustration while shopping for beauty products. There were simply too many of them, and it was almost impossible to learn, try out and buy the right product. Their solution was simple and elegant. For a fee, they sent out samples of beauty products accompanied by top notch content to their subscribers — so they can discover, learn and shop.
Let’s come back to India. Online women shopping is picking up in the country for similar reasons — the convenience of buying in the comfort of home (or during breaks at office), the abundance of choice and and of course, the cost. Studies by researchers show that gender differences exist in India too, when it comes to shopping.
The big question is when it comes to winning the Indian women on the internet, where does our eCommerce ecosystem stand?
As a keen online shopper myself, I can say that India has a long way to go. On the positive side though I see some changes happening. Part of the reason is that women are playing more and more important roles in the startup ecosystem, and their experience (and perhaps instincts) have led to some really interesting startups.
Take the case of Richa Kar. She went to BITS Pilani, got an MBA from Narsee Monji Institute of Management Studies, and acquired hands on experience in retail, managing a cluster of stores at Spencer’s and later consulting for global retailers at SAP Retail Consulting. During the course of her job, she found a yawning gap in the market. The market for lingerie was under-served, not only because of the unavailability of the right kind of products, but also because it involved some amount of social discomfort. The focus was on pushing the products to customers, rather than serving them with the right fit. To address these pain points, she started Zivame.
Unlike Richa Kar, Preeta Sukhtankar is neither an engineer nor an MBA. She started her career by writing and editing content for the young, first for the youth section of The Sunday Observer, and then for Elle magazine — trying out television, publishing and celebrity management along the way. She wanted to marry content and commerce, and found a way to do it through The Label Corp, a social platform that would give a rich shopping experience. It’s targeted at Indian woman wanting a mix of clothing, accessories and home decor, all curated by experts.
The stories of Richa Kar and Preeta Sukhtankar are no different from the story of Katia Beauchamp and Hayley Barna.
It is stories such as these that makes me optimistic about this segment in India and there are numbers that back my optimism. The question is how do we cater to them. What should entrepreneurs looking at this segment do?
#1 How strong is my value proposition?
What problem am I solving? What are the pain points? How am I addressing them? Richa Kar clearly identified the lack of sizes available and the social discomfort associated with buying lingerie as pain points, and decided to address them.
#2 Focus on the experience
Remember the adage — men buy, women shop. How do you replicate the physical retail experience online. How do you let your customer shop in peace, and yet make a knowledgeable salesperson appear right by her side when she needs some guidance?
#3 Know your customers
That there is a difference between the way men and women shop might be global. But there are likely to be characteristics that are unique to India. You wouldn’t be able to design the right platform, unless you know what these unique features are. There are many number of market research tools that you can use to get a granular understanding of the market. Try them. But, they might not provide you all the answers. For that, you will have to roll up your sleeves and go live.
Women might shop online because they are hard pressed for time. But, they will stay and continue to be your customer only if you give them what exactly they want. Remember women don’t just look for product and price. They are looking for the ultimate shopping experience
Three years ago, in an essay on women and American economy in Fortune magazine, Warren Buffett wrote “Women are a major reason we will do so well.” At Kalaari too, we have bet on some of the amazing women entrepreneurs; and we know there are more in the field. Here’s a quick look at some of them that Kalaari has funded —:
Zivame: Founded by Richa Kar, Zivame is an e-commerce startup that focuses on women’s inner wear. There was a big gap in the market for good quality lingerie, accessible and affordable across cross sections and an option that gave privacy, choice and discretion. Kar jumped in the fill the gap.
CashKaro: Founded by Swati Bhargava, Cashkaro is India’s largest cashback and coupon website. Swati studied at London School of Economics, worked for Goldman Sachs and founded a startup in the UK called Pouring Pounds with her husband. Spotting a huge opportunity in India’s booming e-commerce business, she started CashKaro.
YourStory: Founded by Shradha Sharma, Yourstory chronicles Indian entrepreneurship through personal stories. Shradha, who has worked in Times Group and CNBC, brings her insights into media and passion for people’s extraordinary stories to her startup. Since its founding, YourStory has featured 37,000 plus stories of amazing entrepreneurs.
PopXo: Priyanka and her co-founder Namrata Bostrom, founded PopXo in 2013 to fill the online content vacuum that exists for Indian women.
Grabhouse: Founded by Pankhuri Shrivastava, Grabhouse is an online rental portal. It started as a matching engine for people looking for shared accommodation in 2013 — to address a problem Pankhuri herself faced in Mumbai when she moved there. It has evolved into a full fledged service to find flats, flatmates and tenants quickly.
Industry Buying: Founded by Swati Gupta and Rahul Gupta, Industrybuying is India’s largest eCommerce platform selling industrial supplies. Swati holds a B.E in Computer Science from Delhi College of Engineering and an MBA from Carnegie Mellon University. Industry Buying fills a void in organized industrial distribution in India, connecting over 2 million potential customers.
The LabelLife: Founded by Preeta Sukhtankar, LabelLife is a social, eCommerce platform that provides a curated mix of clothing, accessories and home decor. The collections are driven by celebrated Style Editors including Sussanne Khan for House and Home, Malaika Arora Khan for Clothing, and Bipasha Basu for Accessories.
Truweight: Having identified a lack of credible weight-loss solutions in the market, Megha co-founded Truweight in December 2013 to provide consumers customized nutrition plans, weight loss counselling and fat burning superfoods.
Embibe: Founded by Aditi Avasthi, who holds an MBA from Chicago Booth, Embibe is an ed-tech startup aimed at students preparing for complex competitive entrance exams. Embibe uses extensive data analysis to design personalized test preparation for students.
Disclaimer: Kalaari Capital is an investor in YourStory.