Last month, a friend of mine was looking to revamp her house to make it more beautiful and functional. She whined how she struggled with finding the right designer, sourcing quality hardware like doors, faucets, kitchen cabinets, etc., and managing the whole renovation process.
So, I told her about Livspace, which I remembered from an advertisement starring Virat Kohli and Anushka Sharma. She felt so relieved knowing how Livspace has provided a solution and made it easy to get a home revamped. This story covers how Livspace, through its unique business model, is redefining the unorganized home-décor industry in India and outside.
Like everything else around us, the interior design industry is evolving as we learn to live with the pandemic. At least one workstation is now required in every home. Can you picture having interiors that are sensitive and tough to maintain?
Not at all, especially when we had to do the cleaning ourselves for a while. Home interiors must now adapt in various ways to the post-COVID-19. You’ll need a skilled designer to assist you in designing for the “New Normal.”
From 2019 to 2025, the global home decor market is predicted to develop at a compound yearly growth rate of 6.6 percent, reaching USD 1,037.14 billion. According to the United Nations, urban regions were home to 55 percent of the world’s population in 2018.
As a result, during the projected period, this rising rate will positively impact the demand for home décor products. Furthermore, the growth of the home decor market is projected to be aided by real estate expansion and development.
What is Livspace, and How it all started?
Livspace is an omnichannel home interior and renovation platform that is one of Asia’s most prominent and fastest-growing in this space. Livspace has designed a unique business model to provide a one-stop renovation solution for homeowners, from design to managed last-mile fulfillment for all rooms in a home, using its technology.
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The platform has brought together a fragmented industry, bringing together designers, brands, manufacturers, and contractors to provide a trustworthy and predictable experience similar to eCommerce.
Livspace now covers 30 metro and non-metro locations in India, Singapore, and Malaysia. Since its inception, Livspace has delivered over 100,000 rooms and sold over 7.5 million SKUs through its platform, demonstrating remarkable growth.
Anuj Srivastava, a Google veteran, and his IIT-Kanpur classmate Ramakant Sharma founded Livspace in 2015 to eliminate the hassle of dealing with many providers, from carpenters to plumbers confusing rates and unreliable schedules. Shagufta Anurag, the founder of Space Matrix, a famous architecture, and design business, was also the company’s co-founder.
It all started when Anuj Srivastava and Ramakant Sharma set out to design their dream homes. They quickly discovered that the industry is highly fragmented, with issues such as finding the right professionals, coordinating tasks, and ensuring fair price and quality being some of the most common problems that people face.
They were motivated to correct the situation and provide a delightful experience for the homeowners. In this approach, they could create Livspace, a much-needed bridge for the business.
Livspace business model
The platform functions as a home-design marketplace by linking vendors and designers with homeowners. All transactions are subject to a commission or margin fee.
Livspace is a three-sided marketplace that connects homeowners with home design products, service designers, and suppliers.
Target Customer:
Couples and affluent families with working professionals who have purchased a new home or have properties with property values ranging from INR 40 lakhs to INR 4 Cr are among Livspace’s target customers.
Operations:
The tech-enabled playbook at Livspace is as follows: An survey questionnaire records the customer’s scope of work, preferences, and budget at the outset. They are then paired with one of the 3,000 interior designers on Livspace.
After online and in-person sessions, the designer creates a mock-up for the customer using Livspace’s proprietary software. Livspace hires third-party contractors to complete the job after the customer has accepted it.
Revenue generation:
The average consumer spends Rs 8-10 lakh, with 10% paid in front and the rest paid in two installments when parts of the job are done. Livspace’s Gross Merchandise Value (GMV) was $140 million in FY21. With revenue doubling every year, FY22 will end with a GMV of $350 million, and FY23 is expected to be $700 million.
Ensuring accuracy and Timelines:
Livspace has built the most extensive collection of standardized items due to interactions between stakeholders. These goods are also integrated into the platform’s proprietary 3D visualization software, Canvas, which interior designers utilize. Designers can use Canvas to create solutions for consumers while maintaining pricing and delivery timeline accuracy.
Leveraging data:
Machine learning is also used by Livspace to match clients with designers, make product recommendations, and curate designs for simple discovery. Hundreds of thousands of data points are used and analyzed in real-time.
Following a $180 million Series F investment round led by KKR & Co., Livspace has joined the coveted unicorn club, becoming the fifth unicorn of 2022 and the 49th firm to be valued at over $1 billion since January 2021. Existing investors such as Ingka Group Investments (part of the world’s largest IKEA retailer), Jungle Ventures, Venturi Partners, and Peugeot Investments participated in the Series F round.
We are honored to collaborate with KKR in our next phase of growth and for the trust expressed by our existing shareholders. Our business is growing exponentially in both India and Singapore, and we aim to replicate this playbook, launch new solutions and accelerate our launches across new markets with operations across APAC, MENA, and Australia.”
Anuj Srivastava, Co-Founder and CEO of Livspace
Livspace presently operates in Singapore in addition to its core market of India and hopes to use the funding to expand into foreign markets. Its strategy is currently being replicated across the APAC, MENA, and Australia regions.
Livspace, for example, launched a joint venture in Saudi Arabia with the Alsulaiman Group, Ikea’s regional operational partner. Last year, both parties committed $50 million to capitalize on the market potential given by Saudi Arabia’s rising real estate market, particularly in the residential sector. Livspace in Singapore, on the other hand, purchased a majority stake in Qanvast, a home remodeling, and design platform.
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Livspace’s quirky marketing campaigns to promote its brand
Home décor is a complicated, time-consuming, unstructured, and disorganized sector. People have a variety of issues that cause them discomfort. Delays, a lack of responsiveness, a lack of project management, a lack of accountability, cost or budget overruns, quality concerns, and other issues are among them.
As a result, the ideal way to advertise a business model like Livspace is to present a story that addresses these worries, both from a design and implementation perspective. At the same time, avoid confusing the buyer by cramming too many messages into a single story. Livspace has created many such campaigns.
Livspace launched a campaign called “Don’t attempt this at home” in 2021. This campaign aimed to promote awareness about the value of living in a well-designed home with high-quality materials, hardware, and accessories. Livspace collaborated with Disney+ Hotstar as an associate sponsor for the Indian Premier League to promote the campaign.
This time, we have taken our brand promise of high quality and efficient design and presented it through the “Don’t try this at home” campaign. The narrative is also timely as many people have spent months cooped up at home and have started noticing the inconveniences caused by poor design.
Kartikeya Bhandari, chief marketing officer, Livspace to Financial Express
Love the Way You Liv, Livspace’s brand campaign for 2022, was recently released. Virat Kohli and Anushka Sharma have been named as the company’s first-ever brand ambassadors, giving the campaign even more oomph. The commercial, which stars the star couple, wants to highlight the growing importance of homes in our lives and how Livspace allows you to be more creative and get more comfortable with every room in your home.
The campaign focuses on the design, quality, and overall experience of home interiors in an average Indian home and how the firm enables you to make your home the best place to be and provide infinite opportunities for celebrating and having fun.
“Through ‘Love the Way You Liv,’ we aim to establish that our company is the best enabler when it comes to building your dream home and our ability to help homeowners get more from every space. We are very excited to have Anushka and Virat on the Livspace team.”
Kartikeya Bhandari, chief marketing officer, Livspace to The Hans India
Conclusion
Livspace is solving a complex, multi-stakeholder problem that demands a combination of advanced software applications, strong execution capabilities, and a consumer-centric strategy – thanks to its unique business model.
This mix of skills has the potential to create a strong competitive edge for Livspace, allowing it to expand its leading position, penetrate new markets, and widen its products over time.