Startups

NaturalKart.com seeks to stand out among organic product e-tailers; Can it differentiate enough?

16 Oct, 2012

Deepak Gandhi, a self-proclaimed fitness freak and founder of Mumbai-based izNatural & Organic Lifestyle Pvt Ltd, the company that owns and operates NaturalKart.com– a destination for natural and organic products – had been fascinated by the concept of organic products the first time he got to know about them in 2010.

"I immediately took my mom, who is the decision-maker for all things related to the kitchen, to the nearest outlet to buy some organic products. But my excitement was doused (at least for a while) when my mom refused to buy those as organic products were very expensive," says Gandhi.

But he didn't intend to give up and as a result, launched NaturalKart.com in March 2012. The site claims to offers certified organic products (organic food is considered healthy since they are free of fertilisers, pesticides, industrial solvents or chemical food additives) across several categories including food items (beverages and sweeteners, cereals, pulses, flour, spices, snacks and dry fruit), beauty products (body, face and hair care) and fashion wear (organic clothes for women, men and infants/kids).

As of now, there are around 600 products on the site from seven brands including Conscious Food, Sattvic, Down to Earth/Morarka Organic, EcoRico, Nourish Organics, Do u speak Green and AuraVedic.

The company has a 7-member team and plans to increase the number of brands to 25 by the end of this year. The product range will subsequently increase to around 2,000.

Gandhi holds a PGDBA in e-business from Welingkar Institute of Management Development & Research, Mumbai, and earlier worked as the regional director at the marketing agency Possible (part of WPP plc). Besides NaturalKart.com, he is also running a digital agency called Cyberkoms DGtal.

Delivery, funding & competition

NaturalKart is following a zero-inventory model and sources the products directly from vendors to be delivered to consumers. While the company handles the logistics within Mumbai, it has partnered with Aramex and FedEx for other parts of the country.

Although boot-strapped as of now, the company will look for funding by the end of this year when the site reaches a decent number of products and gains traction. The target amount has not been frozen yet, but it should be under $5 million.

As far as competition goes, the startup locks horns with a number of companies who offer organic products including Organic Garden, Farm2kitchen.com, Times Internet's Satvikshop.com, Downtoearthorganic.com (run by one of the vendors of NaturalKart), FabIndia.com and Natural Mantra.

Natural Mantra, which recently raised funding from Freemont Partners, currently offers over 2,000 products in bath & beauty, home décor, organic food & nutritional supplements, eco-fashion and personal care product segments. So NaturalKart is pitched among a bunch of peers, some of whom have the cash to burn with a larger bouquet of SKUs, which means it is not the first to enter a virgin market.

"Our differentiation is that we only focus on organic products while others are also offering eco-friendly products. That is also one of the reasons that the products range offered on those sites are more in number," says Gandhi.

Opportunity

Market opportunity is a no-brainer with growing lifestyle although, as Gandhi concedes, the biggest challenge is that not many people are aware of organic products in the first place and even those who know, are not fully conversant with the actual benefits of such products. Besides awareness, the steep pricing of such products is also a deterrent.

According to a recent Yes Bank report, the market size for organic food in India is pegged at Rs 1,000 crore (including exports), which is growing 20-22 per cent every year.

Gandhi also shared an anecdotal evidence of growing consumer interest when NaturalKart received an order from a slum dweller in Mumbai after watching a television programme on dangers of eating pesticide-laden food.

"It's the kind of marketing people could only dream about," notes Gandhi. "Although most of the orders we get come from the upper middle class clientele, some people from the lower middle class bracket are also buying those. And yes, my mom is also sold to the concept of organic food," concludes Gandhi.

(Edited by Sanghamitra Mandal)

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