In January 2017, TAGG was selected for Amazon Launchpad, a programme, which enables product companies to sell on Amazon.
At a Glance
Founders: Rohit Dhingra, Amitesh Bharadwaj, and Saurav Prakash
Year it was founded: 2016
Where it is based: Delhi
The problem it solves: Electronic accessories at value plus prices tailor-made for Indian audience
Funding raised: Bootstrapped
Delhi-based Rohit Dhingra, Amitesh Bharadwaj, and Saurav Prakash met while pursuing computer science engineering at Manav Rachna International University. Having always wanted to start up, the three technology enthusiasts started mapping the technology market in India.
When they found a significant gap in the electronics accessories category, they decided to foray into this space with their entrepreneurial venture, Tagg Digital.
“The Indian mobile and accessories market has significant growth potential, owing to lifestyle changes. Earlier, consumers had limited options either from international brands, which were high in cost or low-quality Chinese products with no assurance of product performance. The Indian consumers had only two choices - either to buy inferior products at a low price or to buy good quality products at a very high price from international brands,” Rohit tells YourStory.
Aimed at developing products tailor-made to the needs of the Indian audience at a value plus pricing, they launched TAGG – which stands for Technologically Advanced Goods and Gears in 2016.
All three got together to start up after putting in a few years, learning the ropes at other organisations, or as independent consultants. Rohit was a digital marketing trainee with the India Today Group, while Amitesh was a technical support associate with Honeywell. Both have worked with Vinove Software and Services Pvt Ltd as Digital Marketing Executives. Saurav, 26, has been an independent professional working on various foreign projects for Website Development and Search Engine Marketing.
TAGG started with an investment of Rs 4 lakh from the founders’ friends and family. Being a bootstrapped startup, it had its own share of challenges. From arranging sufficient funds to communicating with consumers without any physical interface, the founders faced multiple hurdles in the first few months. Added to this, was the competition from unorganised players.
Rohit elaborates, “The competition and challenge were not in terms of quality or price, but to communicate and convince the customers why they should choose us over them. We overcame these by engaging with them through various mediums like social media, e-mailers, and direct calling.
"We also started stocking our products in multi-brand stores in the Delhi NCR region so that the customers could touch and feel our products before buying them. We were also actively involved in the after-sale services to build consumer trust. Though the process took time, it helped us in building a loyal base of customers.”
Although it faces competition from some domestic and international premium brands, Rohit points out that TAGG is different from them in terms of quality, certification, after-sales service, and most importantly, price points.
“Very few players in the market cater to the needs of the Indian audience. We make tailor-made solutions that make us stand apart in this sector,” he adds.
TAGG comprises a team 15 that works across design, accounts, customer support, R&D, operations and warehousing. Rohit looks after the marketing and recruitment part while Saurav heads product and business development. Amitesh is in charge of finance and operations.
With a total investment of Rs 45 lakh, TAGG has launched 20 products, including headphones, earphones, speakers, power banks, and mounting solutions. The products are priced between Rs 799 and Rs 3,499, with an average ticket size of Rs 1200 and the average basket size being Rs 1,750.
TAGG’s target audience are tech-savvy, music lovers, fitness freaks and professionals in the 17-30 age group, mostly from Tier I and Tier II cities. Its most popular products are wireless Bluetooth earphones - TAGG Inferno and TAGG Sports Plus. TAGG PowerBolt car charger is another best-seller.
“We are expanding our catalogue aggressively and have multiple launches lined up for the next four months. We are also planning to enter the fitness smart wearable category by the end of this year,” informs Rohit.
He adds that although they have been approached by some investors, TAGG is not looking to raising external funding now. “As we are in the process of scaling-up our business, we might explore it in the near future,” says Rohit.
In January 2017, TAGG was selected to Amazon Launchpad, a programme which enables product companies to sell on Amazon. “The biggest roadblock for a startup like TAGG is to find early adopters for the product, and Amazon Launchpad offered the right platform; as it helped us to leverage our brand presence on Amazon. Currently, we are one of the best-selling brands on Amazon Launchpad in terms of GMV,” Rohit claims.
TAGG products are also available on Flipkart, Snapdeal and Paytm, as well as from offline distributors. On an average, it gets around 10,000 orders in a month.
“We are soon looking to double this number by expanding our product portfolio and also with the onset of the festival season, we expect sales to increase. In the current financial year, we are looking at a projected annual turnover of Rs 30 crore,” says Rohit.
To minimise cashburn, it does not overstock the goods while having enough stock in hand. This reduces the duration of the cash flow cycle, payment terms with vendors, and other partners.
In the first year of business, TAGG had only two SKUs with which it achieved an annual turnover of Rs 2.5 crore. In 2017, its SKUs increased to 11, and annual turnover was close to Rs 14 crore. The manufacturing of all its products is done through its partner companies in Shenzhen, China.
There was a time when Sony, Phillips, or JBL, were the only options in the electronics accessories sector. The recent past has seen startups like CellBell and Mivi, in addition to brands like Flipkart Smartbuy and Amazon Basics, make a firm footing in the electronic accessories’ market in India. The mobile phone accessories market in India alone is worth more than $3 billion.
With online-offline boundaries in retail industry fading fast, there is ample space for multiple players to grow.