Nirvana – A Sanskrit word meaning disappearance of the soul from the cosmos thereby ending the cycle of death and rebirth. Simply put – attaining heaven. In the context of our subject, Nirvana refers to a place of perfect peace, happiness and freedom. At least, that’s how you feel when you experience the products of India’s No. 1 fashionable audio brand – boAt. Indeed, the tagline exemplifies the user experience.
Lights, Camera and Action!
boAt was founded as a fashionable electronic start-up back in 2016 by Sameer Mehta and Aman Gupta. Entering the typical Indian market, the idea was to bring the fashionable audio products to the masses but most importantly – durable and at affordable prices. They enjoyed the positive demography of India having the largest millennial population in the world. They not only portray themselves as an electronic brand but also sold the dream of as a semi-luxury lifestyle brand. Sameer Mehta rightly puts it – “We are like Zara of electronics, not highly-priced like luxury brands or cheap like Chinese products”
What’s in the box?
The former boxes opened products like earphones, rugged cables, travel chargers & Bluetooth speakers. These were the basic products then to started with. The bigger boxes were revealed later with launches like truly wireless airdopes, wireless headphones, smart watches and the most recent addition – wide range of home audio products (soundbars). The Company has a pretty straight forward strategy for product development. Identify the needs –> Develop a product –> Innovate –> Repeat. One particular example was the introduction of tough braided cables to address the problem of cables which use to break easy. And in an ever-changing world of gadgets, change is the only constant.
Going Left, Right & Centre
Since merely portraying themselves as a lifestyle brand was not enough for them, they left no stone unturned while hitting the market. On one end, keeping customer preferences were at the heart of the Company – they were always conscious about the pricing of the products and its durability. On the other, they played all the right cards while hitting the market. They had the right partnerships, be it with leading e-commerce platforms like Amazon & Fliptkart or the offline retail stores like Croma which saw customers which were averse to online shopping.
Another feature to their marketing campaign and brand awareness was tie-ups with ambassadors of the two most followed industry in India. The Bollywood and the Cricket. They roped in celebrities like Jacqueline Fernandez, Kiara Advani, Kartik Aaryan; singers like Neha Kakkar & Diljit Dosanjh and cricketers like Hardik Pandya, KL Rahul, Shreyas Iyer and the list goes on.
They did not opt for conventional media like print media or television but rather hit the right chords in choosing Facebooks, Instagram and other social media platforms for marketing their products. This is rightly so as their target audience majorly consists of the millennials.
Save Environment – At least that’s what they claim!
Lately, during the launch of iPhone 12, apple categorically said that they would not be providing the charging adapter and Earphones/EarPods along with any of their iPhones. They defended the move claiming it as a measure to become environment friendly and reduce e-waste. Many android brands such as MI, One Plus, Oppo, etc. have also stopped providing earphones out of the box. However, many claim it as a cost cutting measure in an already strong competitive smart phone market.
In any case, it opens the flood gates for accessory sellers to seize the day. In 2019 alone, a total of 140 Million smart phones were sold in India. With the ever-growing smartphone industry in India, the accessory market is bound to take a long leap.
Corona? Lockdown? What’s that?
We already saw the impact of the corona virus on the economies globally. India was no exception. Nationwide lockdown was announced in the month of March 2020 and was further extended in April. The business activities had come to a standstill with only the essential services operative with minimal staff. Work from home have become a new normal with many large corporations allowing working from home indefinitely. However, even this could not stop boAt accelerating their sales. The brand saw over 20% jump in its gross sales during the lockdown. The Company saw a demand of 15,000 units everyday as against 8,000-10,000 units per day in the pre-covid period. The Company has seized this opportunity with the concept of study, work and entertainment at homes.
boAtheads & how they greW!
The Company uniquely calls its customers as boAtheads – a community which is growing with every passing minute. The start-up which just started its operations in 2016, built a family of just short of 1 million customers. The financial data reveals that the Company’s revenue grew from Rs. 27 Crores in FY 2017 to Rs. 108 Crores in FY 2018. If this was not enough, they clocked the topline of Rs. 240 Crores in FY 2019 and reached a golden figure of Rs. 500 Crores in FY 2020. This translates into a growth rate of 300%, 122% & 108% for the year 2018, 2019 & 2020 respectively. Try and explain this to a traditional person with the basic financial literacy (*wink*)
Short of a Unicorn
And after all the data and the numbers speaking for itself, one would wonder, who is backing up such a business. Obviously, the ones with the deep pockets. boAt raised its first round of funding (venture funding) from an external investor in April 2018. Fireside Venture invested Rs. 6 Crores thereby valuing the firm at Rs. 100 Crores. Within a period of 9 months, they raised another round from Fireside Ventures. This time the amount raised was Rs. 15 Crores which soared the Company’s worth to Rs. 500 Crores (5x in 9 months). After this, they picked up some venture debt from Sachin Bansal backed Navi Technologies and Innoven Capital. The latest round of funding saw Warbug Pincus infusing Rs. 731 Crores sky-rocketing the valuation at Rs. 2100 Crores ($300 M) in Dec 2020.
Now, with the crystal-clear focus of the Company to become a global brand, compete with the likes of JBL, Sennheiser, Skull Candy and others, focus on exports and most importantly – becoming it a truly “make in India” it would be no surprise for anyone to see boAt spearheading to become a Unicorn in the years to come.
This post was written in collaboration with Asif Yahiya Sukri LLP. Asif Yahiya Sukri LLP provides unparalleled personalized financial services to a broad range of clients across different geographical locations. With a presence in the USA, India and the MENA region, they ensure that all of your financial decisions are made carefully and with your best interests in mind. They are innovators who understand what goes into building companies.
You can also reach out to them at info@aysasia.com
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