Introduction of FirstCry
Every year 2.5 crore children are born in India. But how many companies are there to serve them? "Only Few". There are thousands of male brands, there are lakhs of female brands, But how many brands are there for children? "Only Few" Now on this matter, A Marwari's attention was drawn And when Marwari's attention was drawn, Then he set up a company worth ₹22,000 crore in 12 years And that person's name was Supam Maheshwari Bolo Waah!
The name of the company is FirstCry. It has a presence in more than 100 cities with over 400 outlets. They sell over 2,000 baby items from 6,000+ brands. This Supam Maheshwari is so special Where big startups spend their lives making one unicorn. He made three Unicorns in the last 12 years
What is a Unicorn?
That company whose valuation is more than 8,300 crores. He made such three companies in 12 years And, we will talk about two companies today.
So, what will we learn in today's case study?
- How to find a new idea?
- How to do market research on new ideas?
- How is marketing done?
- How is expansion done?
- How customers are added?
- How can the margin be increased?
I will tell you a total of seven strategies. And the seventh strategy is also followed by Tata and Ambani.
About Supam Maheshwari and FirstCry
There are many companies and products in the history of business. Which the owner had made for himself. To solve their own problems And later it became common for everyone. For example, Zerodha and Adidas And there are many such, Tell me in the comment box which ones are there. So, today's story also starts from there when Supam Maheshwari became a father. So, he said for his children. I want a product for my children. However, when he went to check. He could not find the product. Now, he was a businessman And used to go to the US and Europe. So, he brought products from there And completed his work. However, Supam Ji thought. If this problem has come with me. Then this problem must have been there with many parents, Then something should be done to solve it After research he said, See - normally, when there is research done. It has been checked whether. As we are thinking of launching the product or service we are talking about Is that already available or not? So, it needs to be checked in three places
At first, it looked at the common platform. They said - Let's go to Amazon, Flipkart. To check whether baby products are available or not. So, he found crores of categories. There is something for everything. However, faced challenges in finding the products for the kids And where some products are able to be found out. Their pricing was a little higher and some things that they wanted, They were not able to find it there. So, he said that that there is no solution on online platforms including Amazon and Flipkart
After that, they said - Let's go to the unorganized sector, Where there are small shops, So, he found that there was no product availability in those small shops. If there is an availability, then there is no quality. If there is a quality, then the rates are not fixed. Applying a mark (tilak) based on one's appearance (shakal). Hence, Supam Maheshwari saw the gap. Like Organized Players i.e., Amazon and Flipkart. They have nothing, They have nothing special And if there is something in un-organized platforms, So many problems are present in that area So looking at all these things. He said that I will fill this gap And he started FirstCry in 2010
Transforming Problem into Business Idea
"Your problem can become your business idea"
Do remember this thing always. The thing that you are understanding a problem. It might be a business idea. Do focus on solving it
What to do in Market Research?
The second thing - What to do for the market research?
Firstly, go to the big players in the e-commerce. What is the condition of their product?
Secondly, check if there is any niche for that product?
And thirdly, Find the shortcomings in the existing options in the market. If you feel that there are some shortcomings in the existing options And there is nothing specialized for it And above people / companies are also not doing anything, So, brother, you got your new area to work upon.
Let's start from where it originally began.
How FirstCry started? And Aggregator Model.
In 2010, he started. He said, let's not come to sell all the products together. He focused only on selling toys, Work only in the metro cities, especially Pune And gradually tested this model among his friends and the people around him, Like whether this online thing is working or not. So, it's moved slowly and they got a good response from it Due to this, his confidence was boosted. Supam Maheshwari - Marwari is hidden in the name. So, it is said that, Supam Maheshwari is a person who works with a very frugal mindset.
What is the meaning of frugal?
Frugal does not mean stinginess. They will spend money, Will spend money rationally, Will not spend everywhere.
They said - Why to Fail Fast? Why do you have to fail after doing it quick? We can become successful gradually. So, there is no need to rush Will proceed gradually. Hence, they first started with a small store. Then they said What can be done with less money or with less effort? So, they said - We can become an aggregator model. We can create our FirstCry website in such a way. In which, we are selling the product, however, We will tell the other retailers to sell their products as well Hence, this is a win-win situation. When the customer comes to my website, He will see more options on the website. He will see more brands. So, he will stay for long on the website And for my vendors, There will be a more simplified way for them as well. Hence, my aggregator platform will work And by doing this, they allowed everyone else While doing so, In today's date, They have more than 6000 brands, And sell more than 2 Lakh items on the FirstCry website What started with toys, Today everything is available there. It means you will find Kid's clothes, Kid's shoes, Kid's bottle, Diaper and Baby Care skin products as well You will find everything there
"Expand your product portfolio"
When you know that a customer is coming to your shop. He is buying two things from you, And he will go to another shop to get the remaining two things And if those two things are related to you. So brother, sell those things as well, They said that these parents came to purchase the toys. So, they will probably purchase diapers too, So, let me sell them as well. They will also purchase clothes. So, let me sell them as well. They will also purchase shoes. So, let me sell them as well. You must have an expertise in it. The customer who is coming, And he can buy whatever is related to your product, Sell them all. Become a specialist. Your sales will also increase. You have a relationship with one customer. Then, why to sell him products only for ₹500, As if you can sell him products worth ₹5000
How to fight competition?
Now comes the most important question, How to fight the competition? So, he said that first of all find out who is the competition? Hence, he said that Amazon and Flipkart are not in the competition. As both of them not deal in baby products as much And there are no such organized players. As I am the only platform
Who is the real competition?
Unorganized Market. Those small shops opened to sell kid's products. This was their main competition.
And he said - We can't fight them, Why can't they compete with them?
"Understand Your Customer" India is a touch-and-feel market. It is from 2010. In 2023, people are still evolved. In 2010, an individual says, How can we take it like this? If something goes wrong online? We will take it with our hands. We will take it after seeing it, We will try it. Hence, they were not able to provide this type of facility. As they have an online presence.
Secondly, these small shops. The customers used to go there again and again. So, here developed a relationship with them. So, they said, here is a strong trust, Customers can also try the products at the shop. That's why people are not coming to the online platform. What to do?
Innovation in FirstCry Business Model
Hence, they make an innovation in the business model And make an innovation in such a way. Even today, big brands copy it. That innovation made was "O2O" "Online-to-Offline" Means?
They also opened their own offline store. He said, look, traffic comes on the online platform. People look at the website, I tell them on the website, listen,
Do you want to try products before buying online?
I have a shop as well, Go and see it there as well. They also designed the shop in the same way, Like the customers have seen the website. This means, which product sells more on the website? In which products, people are more interested?
In the same way, they designed the whole store. First, showing the best-selling products, First, the products with higher margins are shown first, And thus, designed the entire store in such a way. So, now, customers are having fun. The customer can now purchase products From both online and offline stores. He/She can do both.
Now, by following this model, On today's date, they have more than 400 stores. Now you will say, They must have also invested money. How can one open 400 stores? Wait! It doesn't cost money. It doesn't cost money? How do they do it? "Franchisee"
FirstCry Franchisee.
He said, why invest in real estate, interior? Why invest money? He said, 'I will give the franchise And it's not like that they don't have their own stores. They opened their own stores also in the beginning. They open a self-store for testing in any city. In order to take the experience And later on, sell the franchisee. Hence, they opened their self-stores. However, expand more through franchisees. In the franchisee, he said, See, I don't have to give them a place. I don't have to do interior. I just have to sell the products. Will sell the products.
Now, the one who takes the franchisee, They say that there is no tension as we are getting the supplies And the franchiser is also the one providing customers. As there are so many people connected to FirstCry websites, So, the customers will definitely come to me. Hence, he doesn't have the tension of customers and supplies. So, the one giving to the franchisee is happy And the one receiving is also happy Don't be Rigid in Business
"Don't be rigid in business"
Like, I will only do it in this way. We are only an online company, We don't sell offline. See your customers, like their behavioural patterns, Accordingly, change yourself and don't become a leader (politician). FirstCry Logistics and Xpressbees. Now one interesting thing, I will repeat one of my lessons,
They had a problem with their online business named "Logistics"
What is logistics?
Like when you buy the goods online from FirstCry,
Then who will come to deliver? Some logistics company will come to deliver it. Now that the logistics company is a third party, So, the FirstCry company has no control over this. FirstCry said that the product will be delivered in 2 days. However, that logistics company is delivering the product in 4 days. FirstCry said that the product will be delivered safe Their goods got damaged (due to logistics company). So, they said that the customer experience is getting spoiled, What to do? So, they said, do one thing. As it is not working outside, let's do this thing ourselves. Hence, they set up their own logistics company named Xpressbees And this company became so much succesful, It started delivery FirstCry products, along with it, It also started delivering other company products. Due to this, this company also became a Unicorn.
Your Problem is Your Business Idea
This is a copy of the previous one "Your Problem is Your Business Idea" Think, logistics was my problem. I made it a business and it turns out to a Unicorn.
How to do Marketing?
Now, it comes about marketing, How did you do marketing? Do understand, that every product has its own way of buying? Baby Care Products are guided buying
Guided Buying means?
It means an indivdual do not buy this product in a way, Like he picked it up while walking on the road. He assesses whether it should be purchased or not And if we need to purchase it, how will we use it? So, what they did? Developed a community of the parents, Like if you go to their any social media channels, Facebook, Instagram or YouTube
They have created the channels, pages. They launch on regular basis, Like, this is a new product, This product is useful for this thing. This is to be used for this purpose. These are its benefits Parents share among themselves. They share tips among themselves. What should be included babies development? What should be fed?, What should be drink? On all these things, there has been feedback sharing. The whole loop is formed. Hence, due to this,
There is a theme - "Content Drive Commerce". The more you share content related to your products.
Like this happens, this happens, this happens And the person sees the same thing, hears the same thing Slowly and steadily, he is drawn towards that same product. Hence, they have created a big parenting community. Who share among themselves And also take benefits from each other And indirectly, FirstCry's sales increase.
Another example of this, I want to share with you. I will share two examples Rest of you, tell me in the chat box. Two companies have grown using this method exclusively "Sugar and Nykaa" Sugar has created its page. There are millions of followers on it Every day, it states like Apply Mascara in this way, Apply Lipstick in this way Watching all of that, People are learning And then, they purchase those products while bringing them home One more wonderful strategy that FirstCry follows.
FirstCry Box Strategy
That is "FirstCry Box" What is it?
They have collaborated with more than 10,000 hospitals all over India. They say that as soon as a new baby is delivered. A gift is given to his/her parents' from the hospital. They have a collaboration with the hospital, And, just like when parents have a child, They are given a FirstCry box.
What is there in the FirstCry box?
All the items are in the box. That is useful for the baby. Like a packet of diapers, oil and cream And some other useful products. So, parents are happy; it's like really great things And their branding gets established. Like where did it come from? It came from FirstCry
What is FirstCry?
It is a place where all kid's products are sold. Give it a try once! Some coupons are also promoted, The man went into the shop because of that. He found all the things and became satisfied.
Now, you will say that the box must be very expensive. They are distributing 1k to 2k items to each person. No Sir! Their cost is going only around ₹50 - ₹100 Max. Because all the products are there, they are sponsored by the companies. Tell Pamper to add Diapers to the box, Tell Dove to add cream to the box, Tell Himalaya, to add this to the box. So, they include items of other brands. Your marketing will also be done. We are just giving all products in a Kitty. So that more and more people could come to our store. So, the cost of acquiring one customer is between ₹50 to ₹100. So, you can see that there are 10,000 hospitals. How many children are delivered? How many people is the message reaching? And even 10% of the people come to them, So, every year, they keep getting more and more customers. Now, let's talk about how they have made their startup profitable?
FirstCry startup profitable?
Yes, Profitable Startup! It is not looking good in one line? This is the shortcoming of India. There are 114 unicorns in India Out of them, there are 17 which make a profit. FirstCry is one of those 17. That's why it's enjoyable to study its case And I said that this guy is Frugal. He is not a miser, He spends money rationally, He says that I have taken $400 million i.e. ₹2800 crore from Soft Bank. However, I have not spent it till now. I am spending it very carefully. They had a profit of ₹217 crores last year And had a turnover of ₹1700 crores. This year, they have increased their revenue by 1.5 times, Comes at ₹2400 crores, however, However, because of the rapid expansion. They came back again to the loss. At the moment, while I'm making this article, FirstCry is facing a loss of ₹80 Crore. However, considering their last year performance, And their vision, gift box strategy, This man will come out of the loss; It is a guarantee! Now they said -
How to earn money?
Till now, until they have this aggregator model, Like, if you are going into the FirstCry store, And there you are taking a moisturizer So, that is of the Himalaya. Hence, Himalaya is giving very little margin. The company itself is earning a hefty margin. They are getting a little bit. Similarly, if you are buying products of Dove or Pampers, So, the higher margin is of the Pamper. And, FirstCry is getting a less margin. So, when will FirstCry get the margin? When they will launch their own product. Hence, they launched their own private label brand named Babyhug. Hence, it is their own brand, In comparison to the rest of the products, There is a 50% to 60% more margin. Then for their shoe products, They launched a new owned brand named Cutewalk With FirstCry, in some places, Directly, Babyhug is also being launched in some places. Where 100% of the products are made by them. So, that strategy will give them a margin, And FirstCry will bring them customers. In this, If you want to survive in retailing and earn higher margins, Private Label is a must.
Tata launched its private label i.e. Zudio. In that store, they don't sell other brands product, They sell their own products. Similarly, go to the Reliance Trends, There are more of its own products. They sell very few products from other brands. They have kept some products so that people come. However, the main focus is on selling their own products.
Summary
Hence, this is the Supam Maheshwari FirstCry case study, Where we learned, how to find a business idea? How do research for ideas? What marketing tools could be used? We saw how things expand and how margins increase? If you got to learn a lot from them.