Livspace targets budget homes in bid to dominate nascent market
Bengaluru: Livspace, an online home design start-up, will launch new products at lower prices, enter international markets and introduce software products for interior designers, as it seeks to become the market leader in a small but fast-growing market of online interior design.
Unlike the online furniture retailers that only sell products, Livspace also offers readymade home design solutions and connects customers with interior designers.
According to Livspace estimates, the online home design market in India may touch $5 billion within the next five years.
Typically, a majority of Livspace customers own houses worth Rs.80 lakh-Rs.3 crore and the company sells solutions in a range of Rs.7 lakh-Rs.15 lakh.
This year, Livspace will launch products and design offerings for people who buy houses worth much lower, around Rs.50 lakh.
“You will see a lot of price point innovation going forward,” chief executive officer Anuj Srivastava said. “At the higher end, there are people who come to us who want to spend up to Rs.75 lakh. These are people who understand design and obviously we want to create a turnkey product for that. There’s also a massive market for rentals and for homes that cost Rs.50-60 lakh. We have a unique opportunity to introduce these people to interior designing. We are creating products and experiences for this segment.”
Livspace, which is loosely modelled on US-based home design start-up Houzz, expects to record annualized sales of more than $25 million by December from $8 million currently, Srivastava said. Within one year, it will launch operations in south-east Asia, he said.
“Consumers are buying in all kinds of categories online, including furniture, real estate and similar categories that were earlier thought of as unsuitable for e-commerce,” said Harish H.V., partner at Grant Thornton. “Home design is slightly tougher than other categories, but if a firm can bring standardization of solutions and offer a high degree of personalization, it’s possible to build a large business in this space.”
Livspace was founded in 2012 by tech specialists Srivastava and Ramakant Sharma, former senior executives at Google Inc. and Myntra respectively, and Shagufta Anurag, founder of architectural design consultancy Space Matrix.
The firm currently offers more than 1,000 design solutions (and tens of thousands of different versions of these) and sources products from 50 suppliers.
Livspace, which has studios in Bangkok, Singapore and Milan, hires top design talent from those cities as well as the National Institute of Design. These designers work with their counterparts in engineering and technology to come up with automated and readymade designs after taking the latest international trends and Indian tastes into consideration.
“Tech is our greatest strength and although we need to scale up fast, we are being choosy in hiring. Visual technology and other solutions that we need are quite complex so we’re keeping the bar high in terms of talent and hiring mostly from pedigreed companies (such as Amazon, Flipkart),” chief technology officer Sharma said.
Apart from selling designs and products to shoppers, the Bengaluru-based company will offer software tools to designers to help them manage their offerings and connect with their customers more quickly and conveniently.
“In future, anyone with a catalogue of home products, fashion products and other design related businesses can utilize our tools and create a variety of visual content. There’s no one else solving this issue, not just in India, but in the world,” Srivastava said.
Livspace has already bought two start-ups this year: home design marketplace DezignUp and Dwll.in, a curated online network of interior designers. Srivastava said the company may look at more acquisitions.
“There are three key areas that we will grow organically or (through acquisitions). Visual technology—looks and innovation in that; strong technology teams that understand tablets and mobile mediums very well; cataloguing—a lot of our time will go into building a great-looking catalogue,” he said.