Home Retail Fabmart: Bringing Popular Brands to Small Towns

    Fabmart: Bringing Popular Brands to Small Towns


    Fabmart.com, which runs under RU-BAN, an e-commerce model catering mainly to the Tier-III and -IV town customers, was founded in 2011. According to the company, Fabmart.com will integrate the business of retail with the social fabric of small towns empowering the rural consumer with a choice of products that are otherwise available only in metros and large Indian cities. In conversation with IMAGES Retail, Alphonse Reddy, Founder and CEO, Fabmart shares the brand’s journey so far. Excerpts …

    When did Fabmart.com begin its operations? How important is e-commerce today?

    Fabmart was started in the year 2011. The company initially was selling goods in Tier-III and -IV towns in India through printed catalogues placed with the retailers in these towns. The name Fabmart is meant to signify a store for ‘Fab’ulous products. In 2012, the company pivoted the model to an e-commerce model with focus on premium products supported with high-quality education editorial around the product categories.

    For premium products, the Internet is already being used as a medium to research various options available. E-commerce is a logical extension to serve these premium customers. There are more than 6,000 small and big towns in India, and the presence and availability of premium products (through brick and mortar stores) are limited only to top 15–20 cities, so e-commerce is a great way to reach out to the rest of the customers.

    It is also the most efficient way to tap the rural as well as urban base on a single platform in India where broadband Internet connectivity is growing at 20 percent year on year.

    Keeping in mind the industry growing at 30 per cent annually, the Indian e-commerce market is expected to touch US$ 24 billion (Rs. 107,800 crore) by 2015. E-commerce is bound to become the future of Indian retailing.

    What are the highlights of your e-commerce strategy?

    There are three key differentiators to our e-commerce strategy:

    • Premium and curated range of products: These products are aimed at serving the needs of upper middle class customers.
    • Editorial: We research and publish articles on the website that would make purchase decisions of the customers easy. We partner with domain experts who research and give valuable tips to potential buyers. Today, a lot of customers visit our buying guide section to educate themselves even though they are not yet serious about buying a product.
    • Expert advice on the phone: Potential buyers can speak to the product experts directly over the phone and have their questions answered. This is especially important for high-value purchases.

    Apart from these, we pride ourselves in providing personalised service to each customer. We offer best prices on premium products both online and offline. This is reflected in our price match guarantee policy where we offer to refund the difference to the customer if they find the product anywhere else at a cheaper price.

    What is the USP of Fabmart.com?

    Fabmart offers a wide range of luxury mattresses from brands like Snoozer, Springwel, Tempur, Sobha Restoplus and Coirfit. The collection offers innovative and contemporary designs keeping comfort level in mind. All the products are unique in their own sense and spell comfort, durability and strength, ideal for a perfect sleeping system. The mattresses come in various sizes, shapes and forms.

    All the mattresses are manufactured keeping the comfort of consumer’s spine. Along with the super fine upholstery, multi-layered cushioning and imported springs have been used in these mattresses.

    Tell us about the profit ratio.

    We ensure that we have a healthy gross margin. However, we reinvest these profits into providing better customer experience in terms of hiring or investing in technology, etc.

    How is the overall performance of the brand?

    We want to make Fabmart a brand synonymous to buying premium products online. In other words, we want to be the Amazon for premium products.

    What is the average ticket price online? What kind of items is popular with customers for buying online from your website?

    Our average order value is about Rs. 30,000. This is about 20x more than the average ticket price of mass-market players in e-commerce. Some of the products that we deal in include:

    • Mattresses, furnishings, furniture
    • Digital photography equipment including DSLRs, lens, etc. (we have the lowest prices in India)
    • Home tools
    • Fitness and activity tracker
    • Nespresso machines

    What exclusive options do you have for festive seasons?

    We make sure that we offer some of the best deals online and offline. We have a match guarantee policy that applies even after someone purchases a product from us. Some of the current offers are: up to 25 percent off on premium mattresses, etc. We offer the lowest prices on high-end photography equipment including DSLRs and lens.

    What measures have you taken to offer good customer experience on your website?

    Customised or personalied service to individual customers is something that we take pride in. Customers get to interact with our category managers directly and we take this opportunity to (a) provide the best guidance to the customers and (b) update ourselves with what customers are looking for.

    We ensure our customers remember their purchase experience with Fabmart.

    What are the main trends that you have witnessed in terms of online behaviour and e-commerce on your website?

    People are willing to purchase high-value products online. Given the nature of our business, we do not offer cash on delivery as yet but people read reviews of other customers and are willing to shop online even for products as expensive as Rs. 10 lakh.

    Over the past 2 years, what are the changes that you have made in your operations?

    We have made several changes but one of the important changes we have brought about is to make the category managers interact with the customers on a regular basis. This has given us tremendous insights and an opportunity to provide better service.

    In addition, another major change that we have made to our business model is to focus only on high-value products. This has helped us remain focused and address an unmet need in the market.

    How do you promote product awareness and prompt your target audience into buying your products?

    We have high quality editorial on the website that educates the customers on different choices available and how to go about picking the right product. This has helped us spread awareness about some of the products that we sell and has also helped us connect with the right audience. In addition, we spend on marketing activities both online and offline.

    What are the major challenges that Fabmart.com is facing currently?

    One of the major challenges is in the area of logistics and delivery. In addition, we are looking at adding high quality products to our offering like furniture, etc. We do the best in terms of keeping the customer happy but sometimes this experience is spoilt during the delivery part (either because of delays or damages). Ensuring product quality assurance is another major challenge that we face. We do not want to compromise on the quality, as this is core to our brand promise.

    Future plans in the pipeline?

    In terms of future plans, we want to add premium furniture to our list of offerings in the short term and in the mid-term, we want position Fabmart as the place to go to for anything premium.