The brand has signed Alia Bhatt as the first brand ambassador in 2021. A few days back you have signed that Virat Kohli has been named the brand ambassador. Any reason felt for the change? What are the campaigns planned and mediums to be used?
In our entire brand journey, we obviously believe that the category leaders should take a position. The derived benefit of the mattress is it should provide good sleep. What we all realised in the last two to three years of pandemic is the importance of good sleep and its role in our daily life. Hence, we want to convey the importance of sleep in our communications. We wanted someone who believes in it and follows its spirit. For a sportsperson it’s so important that he/she needs to be energetic everyday, which is what Virat Kohli stands for. He is the right choice for the brand to communicate to our consumers the importance of great sleep and its long term benefits.
We signed him for three years and are planning campaigns featuring him. Duroflex is on a journey to make sleep better for the consumers, I am sure signing Kohli adds to that objective.
Duroflex is an omni-channel brand, the campaigns will be on a mix of all mediums. Depending on the market, we will be promoting the new campaign on both traditional and digital mediums. We will also plan for BTL activities. It is difficult to put a number because each of our markets are at different maturity stages with respect to the brand strength. Hence, we will be using the right medium depending on the maturity of the brand in each market. The campaign will be live by the third week of June and we are also getting ready for the festive season.
How do you measure the ROI when Alia Bhatt was the ambassador?
Alia Bhatt has done brilliant work for the brand. While we thought that the pandemic will put us behind by a few years, it helped in the brand grow. During pre-pandemic we were less than a Rs.500 crore company, currently we are a Rs.1,200 crore company.
While many other factors like right products, pricing, worked for Duroflex, Alia Bhatt was very good for us to reach the targets a little more faster. We would definitely attribute our growth rate to Alia Bhatt.
Can you elaborate on the recently launched mattress exchange program by Duroflex? Is this applicable only to Duroflex consumers?
One of the biggest problems for our industry is what we do with our old mattresses. Even if they want to replace old mattresses with new ones, they are not biodegradable and it goes into landfills and negatively affects the environment. Hence, we chose to tie up with an NGO, take the mattresses directly from the consumers, refurbish or make a new product out of it and give it back or donate it to old age homes for any other social cause.
We are doing an end-end exchange programme, which is not restricted only to Duroflex consumers. The response has been great and we are planning to extend the programme for some more time.
Reportedly, the branded mattresses are around 30 pc of the mattress market in India. What is the share of Duroflex among this? How do you see it growing?
Mattress industry is a Rs.5,000 crore market currently, of which 40 to 45 of it is organised. As factors like awareness on benefits of sleep, as new players come in, as the disposable income and buying power goes up, obviously the category will grow. Today, the mattress industry is where the paint industry was 25 years back, it wasn’t back then but today it is a family decision.
Similarly, mattress purchase is also becoming a collective decision of a family, particularly post pandemic when everyone has realised the importance of sleep.
We have categories like super premium and luxury, premium, and the economy segment. We have tied up with a few fintech companies so that the consumers can buy mattresses on EMI like how expensive white goods are purchased. It becomes more affordable. We are making our distribution wider and are penetrating into small towns and villages.
As a brand, for the last 10 years we have been consistently growing at 20 to 25 pc CAGR. We were less than a Rs.100 crore brand 10 years back. With the new campaign we are planning to launch with Virat Kohli to maintain our dominant position. The intention is that we are a very strong brand in the Southern market. We obviously want to spread our wings beyond the South and want to maintain our growth rate of 20 to 25 pc.
Duroflex is a primary clear number one in the mass premium, and premium, and super luxury segment. 75 pc of the revenue is from them and the 25 pc is from the economy segment. We understand that we need to grow in the economy segment. We are putting strategies in place and we are confident of gaining market share there as well as we move forward.
The brand launched Duroflex Waveplus – a smart bed equipped with multifunctional sleep modes. How has the product been received and how is it faring?
This is our first product where we really want to start preluding the space of great sleep. The products have a multi-functional mode including anti-snore, zero gravity etc. Duroflex Waveplus has received good response from the consumers and is out of stock now. Recently, in line with Waveplus, we have launched another product Duroflex Neuma where you can personalise the firmness through an app. This is India's first firmness adjustable mattress. This will be going live commercially in mid-June. We will have various versions of this product. It is a patented technology. There is a motor which manages the entire thing, but is totally noise free and you can have a pre-set firmness in the product. We are the only mattress company which has a sleep lab. I can’t talk about this in detail because everything is in the R & D stage now.
Over the years, we will see a lot of innovation happening in the Neuma space, where we will bring in a lot of technology into mattresses to bring differentiated sleep offerings to Indian consumers.
Duroflex has experience centres in Bengaluru, Hyderabad, Mumbai, and Chennai. Which are the other cities you have opened experience centers in? What is the current number and how many are you planning to open by March 2024?
When we entered this financial year, we were 50-plus in number. Hopefully, by the end of June this year we will be close to 70. When we exit this financial year, we are hopeful to close at 100-plus stores.
In terms of geographical spread, this will be divided equally across the South and non-South markets. Primarily covering all the top tier 1 and 2 cities in India. We also see this as a mode for building our brand. This will be exclusively operated and owned by the company.
Reportedly, Duroflex has 500 exclusive franchise outlets across India. What are the current numbers? How’s the split between metros and non-metros?
The current numbers are at 1,000 now. We want to take it to close to 1,200 by March 2024. We are strong in the South and we still see opportunities to grow in the South. As we plan expansion extensively, we will be expanding in major towns outside the South as well.
According to 2022 reports, Duroflex plans to achieve a turnover of Rs 2,000 crore by FY25. What are the current numbers and strategies adapting to achieve the same?
One of the investments we made is to onboard the right partner to carry the ethos and brand message. We will keep expanding our retail footprint through company-owned and operated brand outlets. We will continue to focus on our core products, mattress. With Kohli onboard we are optimistic about the growth rate at 20 to 25 pc. We are able to manage all these and market conditions are favorable, then we are sure to have good growth.
Duroflex has its roots in South India. Does it contribute the majority to the overall revenue? How are other geographies doing for Duroflex?
The branded mattress has the largest market in the South. South will continue to contribute upward of 60 pc in the next two years. As we hit our Rs.2,000 crore mark, the contribution ratio will be 55 pc South and 45 pc rest of India .
Duroflex also exports, which are the biggest international markets for the brand? How much does international business contribute to the overall revenue?
We have a 100 pc of EOU based out of Alleppey, Kerala, it’s a subsidiary of Duroflex which is called Cocolatex. We only make products for exports. Currently it contributes 5 pc of our turnover.
Duroflex has also recently forayed into the furniture business. How is that vertical faring?
Furniture was born during the pandemic where we were looking for revenues for us to grow and keep us float. It should cross Rs 80 to 100 crore mark in this financial year. We have our own factory.
The category is growing at a CAGR of 12 to 15 pc. Currently in the next two to three years it will scale to 20 pc.
Can you take us through the marketing and media strategies of the brand? Is it led by digital?
As an omni-channel brand, 30 pc of our sales comes from our direct-to-consumer platforms. Hence, we need to be very strong digitally. Five years back we were not spending any money on digital. Currently, a considerable amount of money goes into digital.
Traditional media plays a big role in certain markets. Large part of our metro spends goes on digital. In new and non-metro markets it goes into traditional advertising.
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