Sharma left Leo Burnett in 2013 after spending three decades at the agency. His next move as an e-tailer took the industry by surprise. We caught up with him to find out how his tryst with e-tailing is going so far.
Former chief executive of Leo Burnett, Arvind Sharma, surprised the industry when he decided to leave advertising - having been a part of it for decades - and start an e-commerce venture.
"Advertising was a fantastic experience. I did it for 34-35 years, but I wanted to pursue some of my other, varied interests," Sharma says, over a casual chat in his Parel office. "I am curious about what is new, what is interesting. I got into advertising in the 1970s, because at that time it was new and fascinating. Every three-four years I would say to myself, 'I am having fun, so let's stick around for some more time'," he reminisces.
Sharma started his advertising career in 1979 at Clarion McCann. In 1983, he moved to Leo Burnett, then Chaitra, as account director. He sold his shares to Leo Burnett in 2003 and decided that, by 2005, he would move on. But, as luck would have it, he was put on the regional board and subsequently on the global leadership council. It was only in late 2013 that he finally left Burnett.
His love for technology and desire to "experience life outside advertising" finally led to him launch a few ventures such as Indiasarihouse.com and CheetahSoft - ERP, data analytics and mobility implementation.
"We went live with the website for Indiasarihouse in mid-November last year and started marketing from January this year. The response, frankly, has been better than what we expected. We are clocking at least double the numbers we had forecast," he says.
The site has a network of 30 weaving centres. The team, though small, is procuring, curating, shooting and marketing saris from virtually all the major centres of Southern India, MP, UP, Rajasthan and West Bengal.
The Sari Business
Indiasarihouse had a team of six people at launch. Knowing that e-commerce effortlessly bridges geographical gaps, it seems to be the perfect platform to showcase beautiful textures and weaving patterns of this Indian favourite. Sharma's role was to understand each part of the business and train his team, which reminded him of his early years in advertising - full of hope, anxiety and excitement.
For Sharma, e-commerce was the obvious choice because it requires marketing and advertising skills, and depends on how clear one is about B2C marketing, as opposed to a business model that depends on technology.
"It is a completely interconnected world today," he says, while explaining how he stays in touch with weavers all over the country and the warehouse in Delhi. "We have a panel sitting in different cities involved in selection of saris. Consistently, we are going after the $50 - $75 segment in India and abroad. My role is to make sure that the panel is operating within our strategy and guidelines," he adds.
With a vast amount of data available to e-commerce businesses, Sharma is able to track what each individual consumer is getting interested in, what she is putting in her cart, the click-through rate for email marketing and such. Coming from the brick-and-mortar world, where one looks at monthly data at best, this surely comes as a boon for him.
"If I had to make a trip to each of the 40 countries where we ship, it would have probably taken me a year and a half, and a fair amount of money. So, the power of internet is palpable. You know, by and large, customers still like to touch and feel. But, our returns are three and a half per cent, which is fantastic news in e-commerce," Sharma states.
Usually, an online garments business, according to Sharma, averages with order sizes of Rs. 3,500. But, Indiasarihouse's average order size, he says, is Rs. 11,700. While most saris sold on digital platforms are priced at around Rs. 2,000-3,000, the latter is selling saris in the Rs. 7,000 price bracket. Every third order the site gets, according to Sharma, amounts to over Rs. 25,000, and 30 per cent of the sales comes from repeat customers.
With Diwali approaching, the site is stocking up new sari designs. Sharma also expects the site to break even by then, which, he says, would be "unprecedented."
"I am applying a lot of skills that I learnt in advertising and marketing here. We are not making saris. The weavers actually make them, with occasional design inputs from us. But, all the knowledge one has acquired over the decades seems to be directly applicable, because finally it is a game of engaging consumers and creating demand for your products."
Sharma is already enjoying the perks of being an entrepreneur. For one, unlike in advertising, the business doesn't depend on any one big client.
However, it comes with its own set of challenges.
Saris, Sharma informs, is a big category, with over 90 per cent of the women still choosing saris for special occasions, if not for everyday wear. His first summer job in textiles, before he got into the other kind of marketing, also helped him understanding the category.
Initially, Sharma worried about inventory turnover, which he expected to be around 90 days. But, right now, sourcing is the biggest challenge. With the festive season approaching, this is the biggest priority for the 12-member team. "When you have a startup, you have an idea. But the truth is that there is an enormous amount of experimentation to figure out what really works for you. You have to figure out if there is demand, how to communicate, which platforms to use etc," he explains.
The site currently gets orders from 40 countries, but has been marketing only in six to seven countries. So, places like Sweden, Norway and South Africa rely on word-of-mouth reviews. USA, right now, is the single largest market, accounting for half of the business. But, India is catching up fast, with orders coming in for Bangalore Silk from Bengaluru, Kanjeevaram Silk from Chennai and Pochampalli from Hyderabad.
"We started on the premise that the market is for special occasion saris. While only a handful of consumers want designer saris, a much larger segment is into traditional and famous saris of India. But, they neither have the range, nor the time to go and shop for them. Therefore, if we have good collection, competitive prices and good customer service, they will buy from us," Sharma points out.
Dealing with women, who are often touted as being indecisive when it comes to shopping, can be tough. However, saris and jewellery are two categories that women can look at endlessly, Sharma says. The shoppers, in this case, take time deciding, but once they have placed the order, payments invariably come and returns are few.
Sharma's plan for Indiasarihouse is to keep expanding - not just in the markets the company will reach, but also in terms of markets to source from. Till then, Sharma is happy to be engrossed in the venture, surrounded by beautiful drapes.