The year was 2003. Ecommerce was taking baby steps in India, but there was no dearth of intriguing concepts in the offline space. So, a small brick-and-mortar business in Delhi targeted young people and started selling quirky products, raising a few eyebrows and increasing consumer interest.
Nine years later, the business embraced a digital makeover and entered ecommerce marketplaces for hassle-free operations and wider reach. Next came the bold pivot. In 2014, the company made a foray into the men’s grooming market, largely underserved but rarely explored by new consumer brands as legacy players used to rule that space.
This is the story of Happily Unmarried that has enjoyed a cult-like popularity. Its success stemmed from many factors, be it contemporary (but essentially Indian) product designs or quick-witted branding or exciting music festivals hosted to appeal to a broader group of people.
But deep inside, it was all about successfully predicting a market trend ahead of its time and having the courage to enter a segment still in its infancy. Its men’s grooming business operates under the brand name of Ustraa (Hindi for straight razor) and has emerged as the frontrunner in a space fast getting populated by the likes of Bombay Shaving Company, The Man Company, Beardo and more.
According to Research and Markets, a Dublin-based market research firm, the men’s grooming market in India was worth $643 Mn in 2018 and is projected to grow at a CAGR of 11% to reach $1.2 Bn by 2024. Ustraa has reportedly captured a sizable chunk of this growing market as the new bunch of startups in the men’s grooming space find their advocates among younger generations. Ustraa clocked an operating revenue of INR 60 Cr in FY21.
Both Ustraa and its parent company, Happily Unmarried, are part of hundreds of thousands of Indian businesses with similar entrepreneurial aspirations. However, running a business is not an easy task. There could be unforeseen problems at every step (like the global economic meltdown or the Covid-19 black swan).
Or a single mistake across operations or strategy may bring an ambitious project crashing to the ground. Add to that a highly competitive environment and things get more difficult. That is why a successful business journey involves many learnings, and the takeaways from veteran entrepreneurs are priceless. What has Happily Unmarried/Ustraa learnt from its long journey, pivot and travails? Let us take a look at the fundamental knowledge nuggets that keep the business growing.
First Things First: How To Make Your Brand Discoverable And When To Opt For Change
Rajat Tuli (CEO) and Rahul Anand (MD) first met in 1996 at Mudra Institute of Communication (MICA), Ahmedabad, where they were pursuing their postgraduate studies in marketing communications. But when they went job hunting and researched various companies, both noticed that few consumer-facing businesses ever target single people as their core consumer base. The duo sensed an opportunity and soon started Happily Unmarried, a brand targeting young, unmarried people and offering a wide range of bar accessories, memorabilia and gift items.
Positioning itself as a ‘cool’ brand, the company explored unconventional marketing campaigns, featuring quirky messages to highlight its products and hosting music festivals to attract its target audience. Within a short span, the brand was present in more than 40 cities and amassed a loyal customer base.
The offline-only format worked well for years, but in 2012, the cofounders decided to enter the ecommerce space as recommended by Sanjeev Bikhchandani, cofounder of Info Edge conglomerate. Info edge was also the first investor in the business when the company raised a funding round in 2012.
“Earlier, our idea of running a business was having fun and doing what we liked. We were going to Goa and hosting events. We never thought of it as a big business. But that year (2012), we thought it was time to get serious,” said Tuli.
Happily Unmarried also raised a seed round in 2012 to develop its digital infrastructure. To date, the company has raised funds across multiple rounds with info edge and Wipro Consumer participating in multiple rounds. The latest came in February 2021, when it raised INR 50 Cr in Series H, led by IIFL Seed Ventures Fund.
“The biggest learning for us from our Happily Unmarried years was that you don’t need to spend a lot in ad campaigns to build a customer base. Happily Unmarried was built on word-of-mouth marketing. We also learnt the pitfalls of an offline-only business, including geographic limitations and the huge capital expenditure to serve a wider audience,” said Tuli.
The Change Challenge: Learnings For Newbies In The Digital Space
For Happily Unmarried, the foray into ecommerce was not smooth sailing all the time. Tuli told Inc42 that several automated processes such as product designing, product listing on websites and ecommerce marketplaces and keeping track of online inventories across channels had to be done manually in 2012.
Selling online had other challenges too, right from low internet penetration of 302 Mn, online payment failures and customers not used to buying online. With the inventory range of Happily Unmarried, the company was not able to see the potential of creating a business that could generate over 500 Cr in revenue. They felt the need to come up with a product range which had a bigger customer base. Thus the company decided to move to a different product line and launched Ustraa.
“We realised that we already had a target audience that was primarily men. So, we sat down and mulled over the next best strategy (which would help us leverage the existing customer base) and that was when the idea of men’s grooming products came about,” recalled Tuli.
The Product-Market Fit: What Happens When The Market Is Not Ready
In 2014, the company started working on its grooming brand Ustraa, which currently offers a wide range of products in categories; Beard Care & accessories, Hair Care, Fragrances and Washes like face wash, body wash and soaps. Once again, it was not a smooth takeoff.
Back then, male grooming was a new idea, most experts were sceptical about the potential.
However, the Happily Unmarried team was convinced of the idea of male grooming products sensing the consumer behaviour shifting towards wanting to look good. As a result, the company launched the brand with a limited range of products from the Happily Unmarried catalogue.
Ustraa claims that it started outselling Happily Unmarried just three months after the launch. “We knew we were onto something big and we completely shut down Happily Unmarried to focus only on Ustraa,” Tuli told Inc42. The company now is working towards the target to touch INR 100 Cr in FY22. Apart from its own website, the brand also leverages more than 30 ecommerce marketplaces to grow its customer base. At present, Ustraa sells at over 5,000 outlets all over the country.
The Logistics Hurdle: How To Remove The Roadblocks
Even in 2021, logistics is the biggest bottleneck for ecommerce, and most of the brands are now leveraging third-party logistics (3PL) services for efficient, cost-effective operations and on-time delivery. But that was not the case throughout the last decade.
As the ecommerce business scaled up, courier costs started playing a significant role in the unit economics for the company. To solve the persisting issue, the brand began researching to find the most efficient courier service in every region to understand their price competitiveness.
The company also faced multiple issues with cash-on-delivery orders, still the preferred mode of ordering at the time. Then there were payment delays from shipping partners and numerous cases of delivery failures/RTOs (return to origin), resulting in double freight charges.
However, there was a solution in sight. In 2021, the company decided to partner with the Delhi-based 3PL company Shiprocket and saw improvements on all fronts. For starters, the logistics enabler provides a customised dashboard with all its courier partners’ data to make the service-requirement matching easy. It also gives access to real-time order tracking and delivery reports to ensure optimum service accountability.
“Shiprocket has helped us in shipping orders to 28,000+ pincodes and reaching a large set of customers. They have also helped in adding to our post-purchase experience by updating the customers about the shipment while in transit,” says Tuli.
For Brand Ustraa, going digital from the very beginning and finding a reliable logistics partner have resulted in positive business outcomes. The men’s grooming brand, at present, has its consumer base in 1,300 tier 1, tier 2 and beyond and delivers nearly 1.5 Mn shipments per year.
For Happily Unmarried, the parent brand, it has been an eventful journey, moving through unconventional product ideas and betting big on niche product categories.
According to Tuli, the entire credit goes to its loyal customers who had trusted the company through multiple pivots and transformations.
“Both Rahul and I focus a lot on brand building. We constantly interacted and engaged with our customers on social media, and it helped us generate meaningful conversations and understand their needs. People have a perception that Ustraa became famous in just three months. But in reality, it took us nine years of learnings from Happily Unmarried to build and scale Ustraa faster,” he concluded.