Sound of success: Consumer tech startup boAT powers ahead as India goes vocal for local
Founded in 2016, boAT clocked a revenue of Rs 500 crore in FY 2020, a 108.8 percent growth from FY 2019. Now, the co-founders are setting their sights on building a global audio business out of India.
When Sameer Mehta and Aman Gupta launched boAt in 2016, the goal was to avoid another me-too sourced from China product “without having a clear vision on the design and Intellectual Property”.
Today, boAt is present in 5,000 retail stores, supported by 20 distributors. The startup claims to be clocking sales of over 10,000 units a day, and four million units per year, and says it has served 20 million Indians so far.
In FY 2020, it clocked a revenue of Rs 500 crore, up by 108.8 percent from Rs 239.44 crore in FY 2019, while the business has been profitable for five years straight.
Behind boAt’s growth is a consumer-first approach, which has made the startup one of the most sought-after youth brands in India. Almost 80 percent of its sales coming from ecommerce channels such as Amazon and Flipkart.
By paying heed to millions of customers’ reviews online, boAt was able to learn what other brands did not want to learn —that Indians loved a product that can be part of their lifestyle.
“Our hypothesis was to listen to the consumer and to address their needs. In the D2C world, the consumer’s feedback is instant and that is what we listen to build our brand,” Aman tells YourStory.
Building a global D2C audio brand
According to Aman, at the time boAt launched, Indian players couldn’t compete with Chinese brands and their financial muscle.
“That is why we focused on product quality and starting with small numbers. We started our business by launching indestructible charging cables in 2015, and realised that owning the IP in a brand is very important rather than just sourcing products from China, which a lot of other brands were doing at the time,” he says.
The co-founder adds that the company stayed ahead in the race because of the constant feedback from the boAt community online.
boAt is a pun on the journey of an individual to a place where they feel at ease and forget all their troubles. The two founders started Imagine Marketing in 2014, the parent company of boAt, with Rs 30 lakh raised from family and friends, and designed the first product — boAt BassHeads225 — and launched it in 2016.
But, the real growth for boAt happened with their offline expansion, which added to their online sales in FY 2018 and FY 2019.
Strategising growth — online and offline
In May 2018, Fireside Ventures invested in boAt and its founder Kanwaljit Singh became pivotal in the company’s offline strategy.
Until then, the founders of boAt were reluctant to work with retailers and distributors. “The working capital required to withstand retail distribution would have been very difficult for a brand like ours because the retail ecosystem returns the product if it does not get sold,” says Aman.
But Kanwaljit insisted that to capture India’s consumption story, boAt must launch its offline strategy. The founders began meeting distributors and training them in boAt’s value system. Aman believes that retailers had to be trained to become “boAt heads”, a term used for the startup’s community of loyalists.
As luck would have it, a distributor in Mumbai, observing the success of boAt, agreed to pay the entire amount to buy thousands of units from the company. Aman relented and the distributor became a brand loyalist, and still makes crores from boAt products.
At present, 20 percent of its sales — worth almost Rs 100 crore — come from its offline business. The startup also sells its products at Reliance Digital and Croma stores.
Drawing inspiration from Amazon and Jeff Bezos, Aman says he is focusing on creating a seamless experience and building a premium aspirational brand. Aman, with boAt’s 15-member R&D team and the startup’s design head, ensure that when a product is launched, it is original in ownership and longevity.
“When we launched wireless earpods, we did not launch them because global brands had done so. In fact, we took a year to work on a product that has our brand DNA, which is offering more bass to the pods. The product was also developed with Hardik Pandya, one of our brand ambassadors,” says Aman.
At present, boAt has several influencers, from cricketers like K L Rahul and Rishabh Pant, fashion icons, musicians, and actors. The company believes the lifestyle segment is only going to grow as young Indians are consuming a lot more.
“We listen to our community and we identified that our fans like sports and films. So, we created themes like ‘Sound of the Champions’ and brought in the cricketers. We created ‘Glamour of the Stars’ and brought in Kartik Aryan and Kiara Advani, and finally created ‘Soul of the Musicians’ with stars such as Neha Kakkar, Diljit Dosanjh, and Naezy. We designed our earpods by customising them with Hardik Pandya. The brand is about the future and the trendiness of the future stars,” adds Aman.
boAt twin wireless
Market and the way ahead
A recent BCG report says that the retail industry in India is $750 billion in size and will be $1 trillion in five years.
In 2019, data by IDC ranked boAt as the leading brand in the earwear segment with a 27.3 percent market share. The overall ‘earwear’ market grew multi-fold with 443.6 percent during 2019, making it one of the fastest-growing consumer electronics categories in the country as per IDC's Worldwide Quarterly Wearable Device Tracker 4Q19 release.
In March 2020, the company raised Rs 20 crore in venture debt from Sachin Bansal’s BAC Acquisitions to build its team. It is also rethinking its supply chain due to the impact of COVID-19.
“We are a young brand; we cannot make mistakes. The brand must outlive its founders. I am now creating all business functions such as marketing, sales, and finance. I need to prepare the business for scale for the next four years. Only after that will I think of manufacturing within India and also opening brand stores,” adds the co-founder.
The startup has been talking to manufacturing partners in South East Asia to stop its dependence on Chinese manufacturing.
“COVID-19 taught us that we can be working closely with manufacturers in Vietnam, Malaysia, and Singapore, and reduce the dependence on China. Make in India is a long-term vision and it will happen. We will increase the Indian manufacturing bets in years to come. For now, the focus is to create an ecosystem, a community, and be a wearable and hearable company,” says Aman.
In four years, the founders plan to triple boAt’s revenue. The brand will continue to focus on its online business and also wants to perfect is customer service.
Aman Gupta, BoAt cofounder
Aman says, "We are constantly revamping our website to enhance the experience. While Flipkart and Amazon will be part of the D2C strategy, we will also focus on driving sales through our direct ecommerce channel too."
The founders claim that boAt is now selling 15,000 units per day and have COVID-19 to thank for it because everything from “work to workout” has converged as people are staying inside their houses.
“The consumer wants audio to be part of their lifestyle, especially after COVID-19. Audio has become part of their lifestyle; they use headphones to study, watch videos and exercise, enjoy home cinema, and work with video calls,” says the co-founder.
Aman jokes that it is time for the government to recognise headphones as “essentials”.
Edited by Saheli Sen Gupta