#FernsNPetals sold 6.5 lakh roses this #RoseDay - its highest ever.
MD Vikaas Gutgutia shares how the company is clocking higher sales this Valentine's week.
For the latest news and updates, visit: https://ndtvprofit.com
MD Vikaas Gutgutia shares how the company is clocking higher sales this Valentine's week.
For the latest news and updates, visit: https://ndtvprofit.com
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TVTranscript
00:00 Hello and welcome. World famous singer and songwriter John Lennon and Paul McCartney
00:06 have told us that money can't buy you love. Well, that may be. Yet, this thing called
00:12 love has turned into serious business for gifting companies. It puts a substantial amount
00:17 of money into the tilts of retailers as you and I celebrate Valentine's Day on February
00:23 14th. To decode this business of Valentine's Day, I am joined by Vikas Gudgutia, the founder
00:29 and MD of Ferns and Petals, one of the leading gifting companies. Thank you Vikas for taking
00:35 the time. Thank you for having me over. So you started as a florist some three decades
00:40 ago and then now you sell everything, every gift items ranging from cakes to personalized
00:46 gifting as well as jewelry all under one roof. Tell us what consumers are buying this year
00:53 and what's been their most favorite gifting item? I think the consumerism and the taste
00:59 of people keep changing over the years and when we started as a florist today we have
01:04 30,000 odd products on our site which as you said which encompasses almost anything and
01:10 everything. But yes, flower does remain one of our strong percentage gifting option. Then
01:18 of course for the cake, chocolates, plants, personalized is you know becoming big for
01:23 us because people want some thoughtfulness to be you know part of the gifting they're
01:29 doing. So and now AI is playing its role, we are doing virtual gifting, maybe a celebrity
01:37 can come and sing a song for you or maybe give you a birthday message. So there's a
01:41 lot on the cards. Alright, so what is the kind of sales surge are you expecting on V-Day
01:49 as well as you know this is not just about V-Day, it's about a week. So tell us. Yeah,
01:54 I think Valentine's Day is festival of love and the festival is celebrated for the whole
02:00 week and for us it's the biggest occasion and we normally clock 30-40% you know increase
02:09 in our sales normally you know on a year to year basis but Valentine's Day is like a jackpot.
02:15 I mean we probably will be doing 100% more this year. So 100% growth over the previous
02:21 year? Yes. Is that on a low base or is it on a high base? No, of course it's a lot of
02:27 variety, lot of hard work has gone into it. Okay, but it's on a high base like last year
02:33 also demand was equally good you are saying? You see, demand is increasing every day and
02:38 with the variety and now awareness also helps a lot. Now Valentine's Day being a week long
02:45 festival is probably more prevalent now than it was earlier. So if you put all these factors
02:51 together I think it's working for us. Great and also you know I know for a fact that on
02:57 Rose Day you did sell some 5 lakh roses. I mean that's like a substantial number. Yeah,
03:05 that was a big surprise for us as well. And that's only the online part of it? Only the
03:10 online part. And then if you add the offline that number would be? That number will be
03:15 maybe 25% more. Okay. So close to 6-6.5 lakh roses in a day. Alright and is that same momentum
03:24 continuing? Yes, I think Rose Day was big for us then the Chocolate Day and the Proposal
03:29 Day and all that. So all that adds but I think today is the day, 13th when people order for
03:36 Valentine's tomorrow. So this is going to be the biggest day for us. Okay and in terms
03:41 of sales I would also like to know what is the average budget of a consumer and where
03:49 do they spend this? See average budget is around say 1500 bucks. Okay. 1500 rupees
03:57 is the average ticket size. Some may be 500, some can be 2000, some can be 3000 and they
04:02 spend mostly on you know flowers, chocolates. They like to personalize their gifts, they
04:11 want to put their names on the gift. So it's basically I think Valentine is also about
04:17 experiential gifting. People also gift experiences, people also gift something which is you know
04:23 which is a surprise. So all put together I think but yes roses and chocolates and flowers.
04:32 Right. Absolutely. You did mention that you know Valentine's Day celebration keeps changing
04:38 with new generations. So in terms of innovation, you partly mentioned about the AI part of
04:44 it but if you could slightly describe a little bit more on that. See AI helps you customize
04:49 and choose a gift which is more appropriate for the person you are sending for. So that's
04:54 a tool which makes your gift more precise. That's one thing and I am sure in the coming
05:00 times we'll have many such options and facilities where people can have the ease of gifting.
05:06 So people are focusing or maybe rather preferring AI based gifting items. I think we are living
05:12 in a digital world and I think digitally we need support for everything else you know
05:17 everything we start googling and you know. So we are living in that world where everything
05:20 is digital around us. So this is another tool with us. Got it. Just to speak about the macro,
05:29 we know that there is you know increased prices and that's impacting the wallets of a common
05:35 man. Everything, prices of everything has gone up substantially. Do you think that is
05:40 a concern and is there a potential impact of that increasing prices on the sales?
05:49 Inflation does matter, whatever is said and done. Inflation does matter. Increasing the
05:53 price does affect price sensitive wallets. But I have realized one thing in that you
05:59 know when it comes to emotions, you know the price takes a big seat you know. It's the
06:04 emotion which becomes more. So you know in normal cases it's your head which rules your
06:10 heart. On such occasions it's your heart which rules your head. So that's the difference.
06:16 Right. Absolutely. So that means that you know sales are not going to impact if that
06:22 is what I am going to assume from what you said. Yeah I can say so in Valentine's Day
06:25 once in a year and for such occasion couple of hundred here and there doesn't matter.
06:31 Okay. And speaking about the online versus offline. So we have seen this quick commerce
06:37 in fact you know we can just order in about 10 minutes that's what the companies promise.
06:42 So how is that benefiting your sales and also? We are also part of the delivery system because
06:48 we work as their back end. But I personally feel that yes it's convenient, it's 10 minutes.
06:55 But 10 minutes is product not experience. Okay. What we believe in is that you know
07:02 gifting has to be an experience and that requires some time. So for us the earliest
07:07 gifting is 2 hours. Okay. It gives us enough prep time and delivery time to make it look
07:13 more emotional, more thoughtful. What other gifting platform or the quick commerce platforms
07:20 are doing, they are delivering product you know. Okay. But does that mean that you will
07:24 not kind of take advantage of quick commerce, you will stick to your own portal? No I think
07:29 we are doing already doing that. And of course as a company, as a florist, as a cake manufacturing
07:36 company we want to be part of this new generation 10 minute delivery system. But I think both
07:42 will coexist. Okay. And on the city specific trends I would like to know how are the metros
07:49 faring and also the tier 2, what kind of demand you are seeing from the city? See metros are
07:54 always the biggest you know market for us. It's always between Mumbai and Delhi. Sometimes
07:59 Delhi is ahead, sometimes Mumbai. So they are the 2 top cities. Followed by of course
08:04 Bangalore scores very highly and a city like Patna you know which has the maximum number
08:12 of cakes being ordered. So I think city wise and what is interesting is the upcoming cities
08:20 which are going to be future metros like Jaipur, Surat, Pune you know they are the cities to
08:27 watch for. That's where we see and want to focus more to increase our you know sales.
08:33 That's where I think the growth possibilities are much higher. Okay. Could you share some
08:38 trends on this tier 2 cities as on what percentage of sales coming from this particular? See
08:45 tier 2 cities still has an inspirational value, aspirational value. That they want to do what
08:51 metros are doing. They want to be up there. But I don't think it's become habit as yet.
08:59 So I think maybe in years time or 2 years time it becomes habit. I think tier 2 is where
09:05 the cake is. Okay and the potential markets you did mention about Jaipur and… Cities
09:12 like Jaipur, Lucknow, Surat, you know Pune, Ahmedabad which are rapidly growing big cities.
09:20 Okay and you do deliver to this pin codes. We deliver to 99% pin codes in this country.
09:27 Okay that's significant. Almost every nook and corner of the country is covered by us.
09:32 From Ladakh to Kanyakumari anywhere. Got it. And in terms of your footprint, your offline
09:38 footprint are you looking to expand? We are expanding already. It's just that we have
09:43 kind of realigned our expansion. We are expanding to almost 50-60 outlets a year. We took a
09:51 pause 2 years back because we wanted to redesign and you know make our shops look more new
09:58 generation and updated. So we kind of redid all our shops which were existing. Now we
10:05 are expanding again. So we are at 350 shops right now and we will be adding almost 1 a
10:10 week now. 1 store a week. Yeah. That's what we are looking at in the coming financial
10:16 year. And what would be your revenue target in terms of your maybe 2-3 years down the
10:23 line what are you targeting? I think the immediate target is you know to hit 1000 crore which
10:28 is a magical figure and we are not very far from it. So how much is it at the moment?
10:33 I think this year we should be closing at around 800. So maybe year after that or maybe
10:42 next to next year. We should be looking at 1000 crores and then of course every company's
10:47 dream is to have an IPO. So that's the time we go public. Oh that's interesting. So when
10:53 can we expect like what is the thought you know when do you look at IPO? I do not have
10:58 a jet timeline in mind but yes maybe in 2 years time. In 2 years time. Absolutely. Alright.
11:07 In terms of the you know industry demand I would say I think as per 2023 ASSOCHM report
11:14 the Valentine's Day market in India is estimated at around 25,000 crore. So what is at what
11:22 rate is the industry growing? Is there a number in mind? Maybe 3-4%. 3-4%? 3-4%? Year on year.
11:30 I think what is happening is that people have started living you know away from each other
11:38 you know because of business, because of jobs and everything and gift and something is you
11:43 know it keeps your relation alive. So I think the trend of gifting is continuing to increase
11:49 and in the coming time it becomes even bigger than 3-4%. I will not be surprised. Okay and
11:55 what it is for Ferns and Petals? For your company? Ferns and Petals we are growing at
11:59 almost 40% year on year. 40% year on year. So we are eating up lot of unorganized gifting
12:07 market which kind of come to us because of convenience. Okay but there is also a lot
12:12 of competition in the organized space as well. See competition is everywhere and I always
12:17 feel that competition brings out the best in you. So I think competition but if I look
12:23 at any other industry, gifting is still not so crowded. Okay, alright I think that's well
12:32 and wishing you all the very best and looking forward to a very happy Valentine's Day. Thank
12:37 you so much.
12:37 [Music]