Craftsvilla to invest $10 million in acquisitions1 min read . Updated: 17 Dec 2015, 01:53 AM IST
The company also plans to launch a private label early next year in a bid to focus on customers who buy its ethnic wear in smaller towns and cities
E-commerce company Craftsvilla Handicrafts Pvt. Ltd has said that it is looking to scale and grow by launching its private label by early next year, acquiring three to five companies and expanding to Indonesia and West Asia by the end of 2016.
“We have set aside $10 million for acquisitions in the space of data sciences, analytics, search recommendations and technology for sellers," co-founder Manoj Gupta said over the phone.
The Mumbai-based firm that was founded in 2011 raised $34 million in a funding round led by Sequoia in November and $18 million in April.
“We have been conservative in our spending. Money from the previous round is still not over," Gupta said.
The company released its first television ad in September and has allocated 50% of such spending for digital, 40% for TV and 10% for print. Craftsvilla offers no discounts on its products; the discounts offered on the site are listed by the sellers.
Craftsvilla says more than 40% of its orders are placed by users from smaller towns and cities. To increase focus on this segment, the company will launch its private label and is in advanced-stage discussions with four or five film stars.
“Bollywood has a great influence on users from smaller towns and cities. There is a huge demand for saris and other ethnic clothes worn by celebrities. Hence, we think there is a large opportunity," said Gupta, who is looking to target a monthly sales figure of ₹ 75 crore by March 2016.
The average ticket size of a transaction is between ₹ 1,500 and ₹ 2,500 with a customer acquisition cost of ₹ 500. As part of the private label, it is also looking to sell clothes designed by celebrities to cater to the luxury segment.
Most inventory sold on the site is sourced from Rajasthan, Gujarat and Maharashtra, and the company is planning to add 25,000 sellers over the next two-three years.
Moving away from indigenous growth, there are plans to launch in Indonesia by June and West Asia by December. “We launched in Malaysia this September and sell abayas and hijabs that are the ethnic wear of the country. The idea is to sell ethnic wear that is core to each of the countries we are looking to expand to," said Gupta.