After lending to India's poor, Ananya Birla, the 22-year-old daughter of Kumar Mangalam Birla, the countryâ€™s eighth richest man (according to Forbes), is now looking at the other end of the spectrum with the launch of her second venture Svatantra Online Services Pvt. Ltd that will run e-commerce luxury website Curocarte.com.
The website will sell handmade products sourced from around the world to India's elite and also to a global audience.
Birla has been working on Curocarte for the past 14 months and will launch the website in September. Curocarte will cater to young people who aspire for more, Birla said, adding that those from SEC A1, A2 and B1 households are the companyâ€™s target audience.
SEC stands for socioeconomic classification of households according to education of the chief earner and the number of consumer durables owned.
Curocarte will source home decor products (think frames, vases, and the like) from nine countries across Asia and Europe including India.
Currently there are not many retailers catering to the affluent Indian's home decor needs. There is Villeroy & Boch, whose products are priced upwards of Rs.25,000. Then there is a big gap and there are department store retailers such as Shoppers Stop Ltd and Lifestyle International (P) Ltd.
"There is a captive latent market in India, which is the affluent class, who are already online shoppers. Their current choices are limited to luxury malls and high end boutiques as well as cross-border e-commerce. These consumers have very few options today for home decor, luxury utensils, curios...,â€ said Sreedhar Prasad, partner, e-commerce, KPMG India.
Still, it will be a tough market to crack and Birla knows that. Among the many inspirational and motivational quotes that decorate the walls of her 17th floor office on Elphinstone Road in Central Mumbai is one that says: "The e in e-commerce is not for easy."
Curocarte is entering the market at a time when e-commerce appears to be at a crossroads. Transacting users, or those who buy things online on a fairly regular basis, jumped to 50-60 million at the start of 2016 from 12-15 million at the end of 2013, according to industry executives. The number hasnâ€™t grown since.
The stagnation is reflected in the size of the market. Online retail sales fell to an annualized $12 billion in June, compared with $15 billion in December, according to estimates by research and advisory firm RedSeer Management Consulting.
"It is a tough business we are getting into," admits Birla whose first venture was a micro-finance company Svatantra Microfin Pvt. Ltd. She is confident that Curocarte will find a place for itself, change the way people buy home decor items, and also break even. "Can't give a timeline (for breaking even)," she added.
Her confidence probably stems from the fact that her two-and-half year-old micro-finance company is on its way to profitability. "Svatantra will break even next month," said Birla. Svatantra will close financial year 2017 with revenues of Rs.500 crore, growing more than 100% from approximately Rs.235 crore in financial year 2016, said Birla. She did not disclose the profits of the privately held company.With Curocarte, apart from everything else, Birla will also have to make Indians accept an Indian luxury products aggregator.
"Traditionally, Indian's are not known to pay premium price for Indian luxury brands like they do for global luxury brands," said Prasad of KPMG. He added that Curocarte's concept could work if the company highlights the global origins of the unique product, which it is selling in India.