Arindam Paul has emerged as one of the most insightful marketing voices from the Indian startup ecosystem over the past few years. His practical posts and threads on various aspects of marketing and growth are chock full of advice for founders and operators covering diverse topics such as brand marketing for D2C brands, advertising strategies for Amazon marketplace vs Flipkart etc. 

Arindam joined Atomberg Tech in 2015 as one of the early team members, and has been with them for the past eight years. He is now the Chief Business Officer. Atomberg started with selling fans, and has now expanded to other consumer appliances such as mixer-grinders and smart locks.

In my chat with Arindam, an edited transcript of which is below, we cover a range of topics including how Atomberg found early PMF (product-market fit) with the B2B channel, then expanded to B2C and had to find PMF all over again, the importance of an omnichannel strategy for D2C brands, and why without such a strategy Atomberg couldn’t have scaled to where they are today (it is very hard to change customer’s channel / buying behaviour), Arindam’s definition of PMF and the two indicators he uses to track and judge PMF, and how D2C brands should think about marketplaces, and approach Amazon and Flipkart respectively. I thought it was an extremely insightful conversation. I hope you find it so too.

Following our conversation, Arindam elaborated his thoughts on PMF in a thread on twitter, including listing 10 metrics that he used to judge PMF, across three channels – Amazon, D2C (google / meta ads) and General Trade / offline. It is a good accompanying read to this transcript.


Sajith: So, I’ve been at Blume now for the last four and a half years. We traditionally never invested in direct-to-commerce or consumer brands, but of late we’ve started getting a little more interested in that space. We hired a colleague called Apurva.

Arindam: I have met her. I think I met her at one of the events recently.

Sajith: So, Apurva really spearheads this space. I don’t do as much. Given we started looking at this space, we try to learn from different brands and as part of the PMF Convo I also did a conversation with Wakefit.

Arindam: With Chaitanya. I read that.

How it all started; Atomberg’s early days

Sajith: Right. So, I’ve been curious to do that with you as well. So, broadly we can look at it in terms of, I have a few questions, we don’t have to stick to that. And those questions will be a bit about PMF and all that. I would like you to begin ideally by really talking about your journey and the early days of AtomBerg. I believe it started in 2012-2013.  You joined fairly early & then there was a seed round after you. It was a little less known in the world & all of a sudden now it’s become like, wow, it’s so big. Everybody’s talking about it. It seems built in a very thoughtful, intentional manner or maybe not, who knows? So, I would love to hear from you both about your personal journey

Arindam: And as well as AtomBerg’s journey?

Sajith: Right. And I would love to write notes meanwhile as you keep talking.

Arindam: Sure. So, AtomBerg was started by Manoj (Meena) right out of college. So, he’s a IIT Bombay Electrical Electronics, five-year dual degree graduate. I think 2011 is when he graduated. And the core reason was that he wanted to do something in the hardware field,  Did not want to do coding, did not want to do management jobs, did not want to do MBA, was very good with all the tech stuff, he used to win a lot of robotics competition. So, you always have this kind of people right in the college where some 5-10% people were really into what they learned in those four or five years.

Sajith: True engineers.

Arindam: True engineers.  So, he was one of those. So, I think 2011 is when he graduated and started AtomBerg in 2012, right out of college.  The other co-founder is Shibam (Sibabrata Das) who is also a IIT Bombay graduate and Manoj’s hostel mate. I knew Shibam from school, that’s why I joined AtomBerg. So, in 2012-13 they’re figuring out what to do & the first product that we had was a data acquisition system (DAQ). So, nowhere close to consumer appliance or anything like that. It was a DAQ which was being sold to different colleges, institutes like BARC, ISRO, DRDO and all of those.

Sajith: Let me repeat, this was you said data acquisition system?

Arindam: So, say for example, in a lot of your laboratories, a lot of testing, a lot of experiments are done, these are hardware product where there were some ports…and then this data could be stored from any experiments, it could be stored in your laptop and all of those. So, basically to acquiring a lot of real time data … it was a mix of both hardware as well, software. So, at the same time, at that point there was a second product which was a vehicle tracking system. So, I think that was a time when Telematics and all those things were taking off at that point. They tried doing it for two, three years, the products were really good, but these were not scalable products. It was a very customised requirement, IIT Bombay, some chemical laboratory will have some requirement, some other laboratory will have some other requirement. But for the first three years, I think what Shibam also puts it very well is when someone asks ki kya kar rahe the? Survive kar ahe the. (…when someone asks what were you doing? Just surviving)

So, I think that was what they’re doing for the first three years. No product, just doing some projects here and there and figuring out what to do. I think that intention was always to do something meaningful and big. Now, in college days, Manoj had an expertise in motors. And primarily BLDC motors, because his final year project was also on BLDC motors. So, BLDC is a Brushless DC motor. I’ll tell you, I’ll come to BLDC motor because that’s the core of the product that we have scaled so far in fans. So, that expertise in motors was there and fan was an industry which had not seen any innovation for say 50-60-70 years.

And luckily in fans, the manufacturing in India was fairly established. So, there were players who could give you bodies, blades and all of those. So, the manufacturing infra was there but not a lot of innovation was there and motor expertise, something that we had. So, we built a prototype at that point. When the prototype was ready, that’s when I had joined around that time and we had a very small setup, just small assembly setup where we were able to say, assemble some 500-1,000 units every month, this was late 2015. And primarily we figured that part out, somehow on how to put up an assembly line, small assembly line, the area of which would be similar to a 3 BHK in Navi Mumbai.

And somehow we were able to manufacture these 500-600 units a month. So, there are two parts, right? One is manufacturing, one is selling. So, when we had the prototype, the first question was tumko to manufacturing aati nahi tum log manufacture kaise karoge (you guys don’t know manufacturing, so how will you manufacture at scale?). So, manufacturing some how, we did some assembly and all those things, we learned a lot from YouTube also ki kaise karna hai (how to do it) because manufacturing expertise nahi tha kisike paas (none of us had), the technical expertise was there, but manufacturing expertise was not there. And the other part was ki manufacture to kar liya ab bechenge kaise (it is manufactured, but how will we sell?).  So, we had absolutely no experience or expertise in any sales be it B2B sales, be it distribution, be it e-com or D2C.

But we figured out fairly early that we can’t do B2C because it takes a lot of resources. We went to few retailers aur usne bhaga diya humko, ki kya leke aaye ho (they brushed us off saying this will not work) just because you have a product, are you mad or what, is this going to sell as a premium product. So, a normal fan, you sell for around ₹1,500-1,700/-. This was selling for around ₹3,500 because the underlying technology itself made it more expensive to manufacture. So, I will speak about the technology part, and then I will move to the sales part. So, technology. A normal fan works on induction motor. So, induction motor main kya hota hai ki (the way it works) both your stator, as well as rotor, again technical, but I think is very basic technology that the motor and rotor, both these are copper coils and both of them work as electromagnets. Because of this, any kind of induction motor, after working for 3-4 hours, you’ll find a lot of heating.

And this heat is basically a loss of energy. So, electrical energy, instead of getting converted only to mechanical energy, rotating the fan, it is getting converted to mechanical energy plus heat energy and the heat energy is a pure loss. BLDC has a permanent magnet as a rotor. The rotor is not electromagnet, so, there is no heat loss. So, because there are no heat losses, it is much more energy efficient. So, these motors used to consume around 65% less electricity than a normal induction motor. So, the proposition of 65% less electricity meant this used to translate to around Rs.1500/- per year cost saving. But flip side, the fan was expensive. So, it is similar to EV which is more expensive, but it saves over the long run. And all these things of total cost of ownership and all those things come in. Now for a consumer it is not even in its consideration set to think about this. No one even thinks how much electricity a fan consumes, at least that is what we used used to think at that point.

Getting to PMF in B2B

Arindam: No one used to think because you just don’t relate fan with a lot of electricity consumption. But when you talk to the B2B clients, when you go to the factory, so we started talking to a lot of these factories, industries, schools, colleges, hospitals, etc. Luckily, we figured out one segment called the ceramic industry. So, this ceramic industry is a very clustered industry. A lot of these industry is situated in two districts in Saurashtra (in Gujarat), Thangadh and Morbi. In this industry they used to dry these tiles, your sanitaryware and for drying they used fans. So, there’ll be these huge shades and every shade will have some 500-1000 fans.

These fans will be running 24/7 trying to dry the ceramic. And there we figured out our early PMF. These people needed these fans; for them the fans were not an added benefit. It was in startup lingo, a painkiller or antibiotic and not a vitamin. It was because electricity was their main raw material cost because there were so many fans, 500-1000 fans in one shade. Each industry had 3-4 shades and it was a pretty clustered industry. So, the moment you go in one of the factories, you do a proof of concept there, word of mouth spreads like anything in that segment. And very early we understood ki abhi hamare paas resources nahi hai (we don’t have resources) so, this is what we need to do for 1.5 years, every month or so we have to go visit, meet those owners, meet those electricians who can give service there, put up a local service centre there, do a lot of seminars, do a lot of education sessions. In fact, for the first one year, 60-70% of our revenue used to come from this industry alone.

Sajith: It spread virally in that area.

Arindam: So, today we have 70% market share in that area. Most of the ceramic companies and factories, even the large ones are using Atomberg fans in their factories.

Sajith: Got it. The first two years…

Arindam: First one year I think primarily was this. So, that was one part that was also the same time when e-com was just taking off. And when I say e-com was taking off, I’m talking about categories beyond books and mobile phones and fashion. So, 2015-16 was a time when large appliances, small appliances, a lot of appliances saw a lot of focus from Amazon and Flipkart had a lot of this focus. You remember a lot of those Flipkart ads at that point used to talk about appliances and we were one of the early movers there & that really helped, because that was a level playing field for everyone. Kisiko kuch nahi pata tha ki kaise bechna hai. (Nobody knew how to sell online).

So, unlike General Trade (GT) where the legacy players held a lot of knowledge, network and all of those, online, I think that was a level playing field for us. And online allowed you to do so many things, I think you can tell, we can reach to all pincodes at the same time. You can tell your story, you can tell your product benefits in a better way. So, 2016 is when we also started our D2C as well as the e-com channel. And till 2018, this was the business D2C + Ecommerce + B2B. B2B again, primarily located in clusters. So, we figured out ki ceramic cluster jaise aur bhi cluster honge (there will be similar clusters like Ceramics), to we figured out another cluster which is textile cluster. So, textile cluster is the same, there are a lot of people, it’s very labour intensive. So, you have a lot of the labour, about 200-250 people staying and again, 100-150 fans running 24/7. So, we did textile industry, we also did the cold storage industry. So, potato cold storage also uses fans along with the AC to maintain the temperature gradient. So, we figured out these small clusters one by one.

This was one part. We also figured out a lot of educational institutions because by virtue of our network IIT, IIM that network was there, since we were doing something new. So, getting entry into few of these good educational institutes was a little easier. So, IIT Bombay was one of our early clients wherein they put in one hostel, they saw the benefits in the electricity bill, they moved to more & more hostels. And now every new construction that comes up in most of the IITs, Atomberg fans are used.

And by virtue of that, same for hospitals, Indian railways, in fact. So, that was one of the very early B2G clients, very big on efficiency and all. Now one interesting thing that we did in a lot places like Indian railways and a lot of corporates like ITC, Infosys etc., we didn’t go the traditional way of selling fans to them, we went through the sustainability route. So, we reached out to the sustainability head instead of the procurement or the admin guys saying “Boss you are spending so much on sustainability, you might as well try these. These will give you much larger impact in terms of what kind of savings you can do.” So, that really gave us an entry into a lot of the big corporate groups, set ups like ITC, Infosys, Reliance. All big corporates, for their big market projects they started using our fans. So, till 2018, this was what we were doing and we reached around ₹3-4Cr per month scale.

And we didn’t raise a lot of money, we could not raise. It’s a mix of two. We just raised $1 million round seed from Parampara. At that point they were called Parampara, today they’re called Inflexor. So, this was in 2016. So, that’s the only capital that we had raised. And using that capital, we built a ₹4Cr per month kind of a business, primarily B2B + marketplaces + D2C (Direct to Consumer).

Sajith: At this time, B2B would’ve been two thirds of your business?

Arindam: B2B would be 60-70% and eCommerce would be the rest.

Sajith: So, there was one REM ventures who put in ₹1Cr in the seed round?

Arindam: For setting up the assembly plant in 2015. So, that’s actually the promoter family of the Aarti industries. So, Aarti industries is a multi-billion dollar industry. It’s a listed company. They’re very big in chemicals.

Sajith: That was in 2014 or ‘15?

Arindam: That was in ‘15.

Sajith: ‘15,  And then Parampara did the round in ‘16. Okay.

Arindam: ‘16. Yes.

Sajith: This was after you had joined?

Arindam: Yes.

Sajith: Tell me when Parampara (now Inflexor) was investing, you had started seeing the Morbi growth?

Arindam: Yes. So, when Parampara had come, we are doing 500 fans a month. So, 500 fans a month would be around say ₹15-20 Lakhs; ok, more than 500 in fact 700-800 in that range.

Sajith: Okay. So, Parampara invested at 700-800 fans per month.

Arindam: Yes, that would be around say close to ₹15 – 20 Lakhs a month. That was the revenue at that point.

Sajith: Very helpful.  But again, this would’ve been CM2 positive, unit economics…

Arindam: Yes.

Sajith: Yeah, this is fantastic. Continue, it’s very interesting to hear. And I think people would love to hear this.

Adopting an omnichannel strategy

Arindam: This was in 2018 but again, very soon we realised that bulk of the market is offline and very counterintuitive. But at that point, we had this strong belief you cannot change a consumer’s channel behaviour at scale without spending disproportionately. So, if I’m buying shoes offline, for example, agar mujhe joote dukaan main jaake kharidne hai mujhe kitna bhi ad dikha (If I like to buy shoes from a retail store, then no matter how many ads I see) I’m not going to click on that ad and buy. And that’s a reason why a lot of these consumer brands struggle because fundamentally they’re trying to change channel behaviour. It’s not just about product market fit, it’s also about product market channel fit. So, 2018 we realised because we did this, a lot of the traditional consumer investors passed Atomberg saying, why don’t you do only D2C or why don’t you do only D2C + ecom (marketplaces) and try and scale it because you are trying to get into a territory. At that point, omnichannel was not the flavour of the market as what it is today.

So today, if you do this, it’s a proven case study and everyone says you need to be. But that was a call that taken in 2018 because uske bina hame pata tha ki (without omnichannel we knew that) CAC & all these things will go out of control. And there were two things, one is because the channel was 99% offline, and second was our consumers were telling this, I saw your ad on Facebook, I came to your website, I like your product, but I want to buy from the retailer that I trust so that tomorrow if something goes wrong, I go to him. Secondly, I spend so much on my interiors, I’m not going to buy a fan without seeing what the colours, what the shades are. So, this gave us the conviction ki agar bada banna hai to offline karna hai (to scale we needed to add offline), I think it’s about how you do it. And 2018 we started our offline operations.

So, we started with Bombay. We are very clear that we didn’t understand a lot of it. So, we wanted to spend one year understanding very deeply on what distribution model will work, whether direct dealer model works, distributor model works, what kind of counters will sell more AtomBerg fans? Is it traditional bigger counters or we’ll find some niches which will sell more? That one year is when I myself spent a lot of time with the distributors, in the counters, trying to sell from the counters. And a lot of our learning happened in that one year. And that possibly started translating into everything that we have done since, right from our communication, what the brand should stand for, from what the product gaps were, how do you fill those product gaps to what the distribution strategy should be, what kind of counter should we present?

What kind of POS (Point of Sale) material work? What kind of display should be there in the counters? And totally first principle thinking, which is both a good and a bad thing. Bad thing because it took us a lot of time. So, because we didn’t know anyone if you go to the counter for the first time, he’ll just say, please go away from here. Second time jaaoge to bolenge phir se aa raha hai to sincere hai (the second time you go, they will think you are sincere given you are revisiting), to he will call you. Third time maybe he’ll maybe speak to you about cricket, politics, he’ll give you a cup of tea. Fourth time he’ll talk about batao kya product hai (ask you what product you have) you’re coming regularly that means you are serious about doing business. That’s how subconsciously they test whether you are serious or not. And then fifth time they’ll say, place 4-6 fans, we’ll see.

But it takes a lot of time, that’s the bad thing. The good thing was we did not have baggage, we were thinking from first principles. Thinking ki sell out kaise karenge (how to sell out), the industry was not used to operating in this way. The industry was operating in a very push driven way. You just push it to the distributor & distributor pushes it to the retailer, retailer pushes to the consumer. We are trying to do things totally opposite. We were trying create pull at a retailer level, trying to create pull at a consumer level and so on and so forth. This was 2018-19 we got proof of concept in Bombay and that’s when A91 happened. We were doing around ₹4-5 Cr a month. But by the time Bombay was also contributing 400-500 fans (a month), repeats were coming, retailers were asking for repeats, cohorts were very strong, despite a very limited portfolio.

Sajith: Got it. I have one query 400 – 500 fans means roughly how much, one fan is how much?

Arindam: I think our realisation you can take approx Rs.3000/

Sajith: Got it. So A91 round gave you a lot of ammo.

Doubling down on Offline; The Kerala case study

Arindam: Yeah. So, I think there are two things, one is ammunition and second is with A91 coming in because they had seen that story play out across multiple brands. So, they had conviction in two things one is go big on offline distribution, you have proved Bombay, then there’s no reason why you should go slowly now you have cracked the model more or less. And by that time, we also started a lot of the southern states, western states and in down on each of those markets around that time.

Sajith: So, they said, great, you’ve proven Bombay. Go all out as much as you can.

Arindam: Along with Bombay before A91 we had already started the Southern states & Gujarat. Because in Gujarat, we’re already doing Thangadh, Morbi, so some kind of effect, which was already there. Gujarat, Maharashtra and the southern states, we already started when they had come in.

Sajith: So, since then, it’s been a journey of just more of the same basically, right?

Arindam: I think, yes, that is correct. And then Covid happened around March 2020. So when Covid happened, we were doing around say 7-8 Cr a month, that was the scale. We were at the right place at the right time because we were digital native, because we were very strong on ecom. So, that gave a huge spike immediately post Covid we had seen a huge spike in the business, that really helped.

The second thing that helped us when Covid happened was a lot of the other bigger players had challenges in GTM (go to market). There’s a lot of disruption which was happening and so we took it as an opportunity to reset a lot of things in a lot of places. And the story played out best in Kerala, where I think in a two-year time we became a market leader. So, today we are the undisputed market leaders in Kerala. Overall, not just a premium segment, in all we have more than 25% market share.

Sajith: Why is that?

Arindam: So, in Kerala there were two things. One is we went very aggressive on distribution and on ground when post covid the markets reopened. Because when Covid happened there were no stock available and also the existing players’ teams were also not going to the market very regularly. And second is (you realise this very well cause come from a media background) Kerala & TN are very strong media isolatable markets. So, we went big on ATL in Kerala in 2021 itself.

So, Jan – Feb 2021 we launched our ATL campaigns in the southern states and in a much bigger way in Kerala. So, instead of relying just on digital, because we were doing regional ATL digital, a good amount of brand awareness built up because the product was good. And the product market fit was very strong in Kerala because you have this high literacy, a lot of people coming from the Gulf and all building their homes. So, people have a lot of money & prosperity was also there, especially in cluster segments like Malapuram, Kochi and all of those.

And then going very deep with distribution. So, 3-4 things combined and once that Kerala played out, we just replicated the same across a lot of other geographies like TN, Karnataka, AP, Telangana, with different degrees of success. We are still not there yet where we are in Kerala in any of the other states. But we figured out that regional ATL plus digital in terms of demand creation, in terms of building awareness and going very aggressive with distribution and going very aggressive with trade marketing, going very aggressive with the point of purchase display that worked really well for us.

Advertising on third party marketplaces

Sajith: Got it. That’s very interesting. So, I noticed you’re also an expert on Amazon and Flipkart advertising. And that also you’ve been very aggressive, right? So, that’s been one driver as well.

Arindam: Yes, of course. So, I mentioned that in ecom we were one of the early movers. In fact, we became the leaders on Amazon in 2019 itself in our category; very early 19-20 itself, we had become the leader. And then from there we just went from strength to strength because it’s also a compounding cycle. A lot of people underestimated marketplaces, especially Amazon. So, Amazon is a very democratic marketplace. And compounding happens on Amazon because once you start selling your ratings and reviews improve, once your ratings and reviews improve, your conversion rates go up, your conversion rates go up, you sell more. The more you sell, the more you come on top organically for relevant keywords.

So, I call it the Amazon flywheel. A lot of people underestimate that the flywheel really works. And we have seen this work time and again for our different SKUs in fans, from ceiling fan to pedestal fan, wall mounted fan, exhaust fan, multiple categories. We have seen this model work very early in 2019-20. We went very deep on Amazon ads, were one of the early adopters, and went very deep there. Same in Flipkart we replicated, but it’s with a slight lag. On Flipkart, over the last one year is when the exponential growth has happened. On Flipkart usually for brands in early stage, it’s very difficult but once you’ve reached a certain scale, once there’s a lot of inbound demand, that’s when I think Flipkart comes in because you are able to capture the demand. They’re very well penetrated into tier two, tier three cities, primarily north and east. And with their operational efficiencies coming into play that becomes a big platform as well.

Sajith: Very interesting. So, just after that Jungle round happened, right? And then what have been the other rounds, if you could quickly just mention?

Arindam: So, A91 put in some more money in between. And then the Jungle round happened I think in December ‘21.

Sajith: And after that, there’s been the recent round, right? Okay. So, there was no round between Jungle and Temasek?

Arindam: No.

His definition of PMF

Sajith: So, now I want to go a little bit deep into your perspectives on PMF. So, my query is do you have a definition of product market fit? So, is there a definition that you use, if someone were to come and ask you? How would you explain?

Arindam: I think are multiple ways, there are multiple indicators or I think maybe we’ll come to that later. I think you were asking, what is PMF? Right? So, PMF to put it very simply is if you do not exist tomorrow, will someone miss you? In our category, people will and I think that’s a very broad definition of PMF. Now come to the indicators so there has been multiple product launches, a lot have succeeded & a lot have failed. For Atomberg, there are a few parameters which we usually look at. The first parameter to look at is for example, you launch a product in a marketplace, usually most of our launches happen there because that’s been a channel that we are most comfortable with over the last decade. So, we launch it on marketplace, initially you’ll have to drive paid traffic to the page & you use all the search ads, 70-80% of your traffic would be paid & you start getting some kind of sales.

Now if you are able to in month one, 80% of your traffic is paid, and say you are able to sell 100 fans in month two, if you are able to reduce 80% paid down to 60% and that 100 goes up to 200, that means the indicator of PMF is positive.

Sajith: Very well put. Very interesting.

Arindam: That is one. Now to break it down further, so now why will this happen? This happens if the ratings and reviews are very good organically. If the ratings and reviews are not good organically, this will not happen. So, one step further is, if you look at the ratings and reviews, once you sell some 100-200-300 units, you get those 20-30 consumers and do it on a marketplace because it’s a very open democratic thing. Because in D2C what we figured out is that your D2C are the brand loyalists. So, they are into your brand, they know your brand and sometimes you don’t get very honest, authentic feedback which you’d want for your products. And the D2C traffic is also slightly more a niche traffic. But the marketplace, if you keep it open for 2-3 months, you are able to understand what’s happening, are you getting organic traffic, organic sales or organic is going up, ratings and reviews are going up. That gives a good sense of whether you have PMF in that channel.

So, once that test is passed, maybe the second thing that we usually do is we put it in a select market. So, for example, I’ll put it in a Bombay market, say 20 retailers in a pilot market you put the fans and look at the repeats. So, in a lot of repeats say for example, in a lot of CPG categories, you track consumer repeats. In our category, we track retailer repeats. So, if the repeats are good for a product within 3-6 months, if you have very strong cohorts emerging out from that product, that means the product has a very strong PMF.

Sajith: Got it.

Arindam: These are two broad metrics or this is how we take decisions on whether a product has PMF or not.

Sajith:  Indicators.

Arindam: Yes.

Sajith:  Decreasing paid traffic but increasing throughput on digital marketplaces. And then cohort repeats.

Arindam: Retailer cohort repeats.

Sajith: Because you can’t track consumer repeats.

Arindam: You cannot and this is not a repeat category. If you buy a fan once, you’ll not buy a fan again next month.

Sajith: That is true. So, just a little bit on Atomberg, you also must be tracking SKU level PMF or something like that, right?

Arindam: Yes, of course. That’s what I’m saying. So, what I mentioned to you is SKU level PMF.

Sajith: Correct. But overall there is a PMF which was Morbi in a way.

Arindam: Yes, of course.

Sajith: And that validated that there is a market for your product in the niche market, that gave you confidence and from there you expanded into other institutions, etcetera and started the consumer also.

Arindam: Yeah.

How he thinks about GTM Motions

Sajith: Now a little bit on the GTM motion. So, specifically it seems to me that there is a B2B motion of field sales on offline, but online is a heavy reliance on Amazon and paid digital pricing.

Arindam: Not a lot on paid, not a lot on Google and Facebook. So, how the demand creation happens in a lot of these categories, especially in our category, so we look at the consumer journeys. Whenever the consumer begins their journey, they have a initial set of brands in their mind. So, we call it initial consideration set. And it’s very important to be part of that set. And that is where that focus on ATL has been there very early from the journey. So, we started with regional ATL and we went full-fledged with national ATL last year itself. So, that is one part wherein we want to be part of that consideration set. Today I think maybe that number for us would be in the range of 15 – 20% in our TG (Target Group). So, not very high, but it’s much better and it’s moving in the right direction.

Sajith: 20% of people will have you in their….

Arindam: Consideration set. Yes. So, in laymen term, maybe you call it says spontaneous awareness. We call it initial consideration set because usually it’s a consideration set. So, in categories like this, I think spont (spontaneous) mode, it’s about how you figure out what the buying situation is, and in that buying situation, are you part of the consideration set?

So, one part of the GTM is that you need to be part of this set. The second is there is a purchase evaluation journey. So, unlike a lot of categories, this is not an impulse category. So, you’ll not just see an ad on Facebook and you’ll buy a sale. So, there’s a proper evaluation that happens and to win in this evaluation phase, there are many interventions that we do. For example, the ads on marketplaces, there is a lot of influencer stuff that we do with interior designers & tech influencers because there’s a range of smart fans etc. And you’d go to YouTube and search for best-selling fan review, best-selling fans you’d encounter a good number of Atomberg reviews, because a lot of evaluation happens on YouTube as well.

And then there’s a lot of offline influencers as well. So, we have a good electrician programme.  And then the third part is you need to win at the point of purchase. So, winning at the point of purchase means your listings are very optimised on Amazon, Flipkart, with right pricing, say operations are optimised. People don’t want to wait for more than 24 hours. You have warehouses everywhere, both for Amazon, Flipkart, any pin code anyone can buy within 24 hours. Same for D2C as well, you get the point of purchase & same for offline. In the point of purchase, you have all of your product collateral, you have your display, your demo fans especially for the higher end where people can come feel the product and so on and so forth. So, GTM is a mix of all of these three.

Because it is omnichannel largely, we usually think about GTM in omnichannel way because it happens very often that people begin online, search Amazon and buy offline and vice versa. They’ll go offline, they’ll see their product, they’ll come back & buy on Amazon because they’re getting some credit card discount. So, because it’s omnichannel, we never try to analyse things in a channel agnostic way, we took a more holistic view.

But we figured out very early that to scale, you need to win in all three phases. You need to win in the consideration phase where you need to be part of the initial consideration set. You need to win in the evaluation phase, and you need to win in the point of purchase. So, in the initial days, winning in the consideration part will be slightly difficult because all the legacy brands have been existing for 50-60-70 years. Everyone would’ve used them, heard of them. But the other parts is where we already had a lead, the evaluation phase, because we had a lot of data, a lot of consumer data, D2C data, we are able to predict who would be in market, show them the right ads. Although today Facebook has evolved a lot in the last 4-5 years, but I think 2019-20 having that first party data really helped us in replicating audiences, creating lookalikes on both Google as well as Facebook. So, those things really helped us but in general, one core thing about our GTM is think in a truly omnichannel way because if the consumer is omnichannel, you need to think omnichannel and be present everywhere and do all these activities.

Sajith: When did you start, I know Kerala, you started ATL around Covid.

Arindam: ‘21. Yeah,

Sajith: So that was the time when you truly went like ATL across multiple markets.

Arindam: South. We started with South primarily. So, 2021 is with 5 southern states and Maharashtra.

Sajith: Got it.

Arindam: 2022, again, more or less similar with slight mix of national news and cricket, because it’s a primarily male TG. So, news and cricket really works. And this year is when we slightly doubled down on the national part while continuing to do good numbers in in the regional as well.

How D2C brands should think about their omnichannel playbook

Sajith: Yeah. For brands in the D2C etc. phase who may be harbouring ambitions of going omnichannel, etc., is there like specific inputs, caveats? I’m sure enough folks from the D2C consumer brands community must be reaching out to you.

Arindam: Yeah, of course.

Sajith: Are there specific caveats you share either related to PMF or related to growth or scaling,  do you have any favourite thumb rules?

Arindam: So, I think 2-3 things. One is till the time you are very sure about SKU level PMF in ecom or D2C, do not launch it offline because in offline, rolling it back is very painful.

Because today Omnichannel is a flavour, so people just think, let me just open out all the geographies & I’ll see immediate spike in revenue. And a lot of brands are struggling because of the same reason because offline doesn’t give you a second chance. Maan lo aapne place kar diya dukaan main aur who 3-6 mahine tak nahi bika, (if you initiate retail distribution and it doesn’t sell for 3-6 months) it’s very difficult to relaunch that market or relaunch that counter again that’s #1. The second thing is, before you start ATL, you need a base level of distribution. So, my rule of thumb base is you need a 40% weighted distribution before you spend on ATL.

Sajith: What does that mean?

Arindam: Weighted distribution is, maan lo Kerala main 100 pankhe bik rahe hai (if there are 100 fans selling in Kerala) I should be at least present in those counters which sell 40 out of those 100 fans. So, there are two concepts of distribution #1 numeric distribution and #2 is a weighted distribution. Numeric distribution means there are 100 counters & I’m present in 40 counters. That means I have a 40% numeric distribution. Weighted distribution means in those 40 counters, say for example, those 40 counters are selling 60 fans out of the 100, that means I have a weighted distribution of 60%.

Sajith: Got it. So you are saying at least when you start with offline, you must have at least 40%….

Arindam: 40% weighted distribution or else will not be able to capture the demand. And that’s a very negative thing for example, aapne mera ad dekha aap dukaan main gaye aur dukandaar bola are maine to suna hi nahi hai accha brand nahi hai (if a customer sees the ad and goes to a store, but the retailer says he has never seen the ad, and actively dissuades the customer from the brand by dissing it, and recommending another brand) overall the money that you spend on ATL that gets wasted and the brand image also comes down.

Sajith: Very well put. Great. So, these are good rules. Any others? Anything else comes to mind?

Arindam: These are two things that usually I say. The other things that I’d say you need to invest in brand building very early in your journey because performance marketing doesn’t scale and there are no economies of scale there. In fact, it’s quite the opposite, you try and scale beyond the point, it’ll only worsen your results.

Sajith: Correct, channel saturation.

Arindam: Channel saturation is very quick.

Sajith: What are the things you did at your level? I know there was some organic pull especially because of B2B, but on D2C what are the things you did? You also had to rely on Facebook and…

Arindam: We did, but what was working in 2018-19 that no longer works today.

That’s the first thing that I say if you do what we did then, that will not work. At our point of time, this lookalike audiences (on Facebook) used to work very well. So, because we had this data points, we had this data of the 5,000-10,000 consumers, I was able to create lookalike audiences who were in the buying journey. And I was able to reach out to them at the right point, at the right time with the right message at the right time. And that audience was fairly big. People who were moving into a new home, renovating into a new home. Now today it is very difficult. Also, the CPM that used to exist in 2018 and what the CPMs are today, they’re like way different. There are way greater number of advertisers in India today on Google and Facebook. The same thing I tell our team also we try to do the same thing for our new categories what worked in fans that is not going to work because things are fundamentally changed.

How D2C brands launching today should think about marketplaces

Sajith: So, today for you this brand recall is much higher. But would say for a brand that is starting out today it is better to maybe look at marketplaces. I’m asking, I don’t know. Or it is better to…

Arindam: Depends on category to category. So, there’ll be no one size fit all kind of approach. But if for example, marketplaces are big, if Amazon is really big in a category, then it’s a no-brainer that you should go deep there because a lot of products searches begin and end on Amazon today and they have the highest intent. So, for example, Facebook is predicting intent when you’re running a Facebook ad, you are trying to predict the intent. You have a stated intent. When you have stated intent, why would you want to get to predicted intent?

Sajith: Got it, got it.

Arindam: And in our case, why we did Amazon and why not Google, even though Google searches are also there. Because Amazon was bidding on the Google keywords. So, for example, for the ceiling fan keyword, both Amazon and Flipkart were bidding so I thought, let them bid there & I’ll bid on their (Amazon’s or Flipkart’s) platform.

What to look at post-PMF

Sajith: Ah, makes sense. That’s interesting. So, I broadly got a sense. On post PMF on the scaling front are there any caveats you suggest? Is there anything you would suggest on scaling, are there things that you wish to roll back?

Arindam: Again, while scaling also there are few metrics or things which are very important to understand. For example, when we say post PMF, I would assume it means how do you improve your margins over time? Or say how you reduce your losses over time and the part to profitability. So, when you talk about the path to profitability, there are 2-3 things. So, for example, in case you’re able to reduce margins over time, in the initial days, your margins will be higher than what it is for competition because you are a newer player, there’s more push from the retailer etc. If you’re able to reduce channel margins over time, that is a good sense that you are moving in the right direction in scaling. Because scaling becomes more easier and you are able to create that pool which is being shown.

Sajith: Reducing trade margins, channel margins is a clear sign of power, brand power.

Arindam: Yeah. The second part is the pricing part, saying are you able to increase prices slightly or say for example, now it’s very difficult to fundamentally alter gross margins, but say every year on year for example whenever there’s inflation, are we able to pass on that pricing and not lose any kind of market share so, that’s also very important.

The third thing is you reduce your reliance on discounts and deals. So, a lot of the digital first brands, they’re very discount driven, most of the sales come from those 5-6 days. So, I think percentage of sales, discount driven sales, how they come down, these are hygiene things you should keep tracking. On the trade side the other part is of the receivables. For example, when you start, you need to give credit, but as you scale, is that improving or is it not improving? If it is not improving, that is sign that you are going to hit saturation very, very soon. On what the receivables are. And at some point, once you launch multiple categories, for example, you also track your gross sale and upsell for example, if someone has already bought a ceiling fan, you launch a pedestal how many of them are coming and buying same thing is applicable for mixer grinders, locks in our case, all of those parameters are very important.

The last thing, which is again, very important for post PMF scale – it might not be relevant for our category – but I speak to a lot of founders and I tell this, you need to continuously acquire new customers. There’s somewhere some myth which was there because primarily from consumer tech where there is a lot more focus on retention. But the fact is you might have a single UPI app, but if I ask you which brand of biscuits you use, or how many it’ll not be a single biscuit. You’ll be using multiple brands. So, in consumer brands, people usually choose from a basket of brands and they don’t stick to only a single brand. And that is why it is very important to continuously focus on how do you acquire new customers and why it is more important is because as the brands mature, you encounter more difficult customers. Now the early adopters are very easy to please, but maybe people who come in after some time, their expectations from the band are very different. So, they’re not your early adopters and innovators and what they expect from the product and all of those things. A lot of that also changes.

Arindam’s favourite books and learning channels

Sajith: This is really interesting. Are there any favourite materials you read or learn from? How do you learn?

Arindam: I read a lot of fundamental books around psychology or anthropology or a lot of media textbooks on how media planning works.

Sajith: Any favourite ones?

Arindam: Influence (Robert Cialdini) is a very good book around psychology. There’s this very good book called Decoded: The Science Behind why we buy

Sajith: Who is it by, do you remember?

Arindam:  The author is Phil Barden. For anthropology there is this book called Guns, Germs and Steel.

Sajith: By Jared Diamond. I love it. One of my favourite books.

Arindam: Yeah. So, a lot of fundamental books, because if you understand consumer behaviour at a deep level, then of course a lot of tactical stuff keeps on coming. So, for tactical stuff, I believe that if you want to learn about Amazon ads, go through all the course material that is there by Amazon, same for Facebook, same for Google. I don’t really believe in learning hacks or something, you need to understand the fundamentals of how these platforms work. And if you understand consumers in depth….

Sajith: You seem to be one of those first principles thinkers, like you’ll basically study the textbook and…

Arindam: Yes. I do that quite often. Same for TV also. So, I did not have any background in media and I need to deal with these media agencies – understand, evaluate media plans. The first thing I did is read a text textbook on media planning and buying, on how TV GRPs work, how TV works, and all of those.

Sajith: Interesting. Very interesting. Any favourite podcasts? Favourite YouTube channels? Favourite Twitterati’s etc. who you learn from?

Arindam: Not exactly. I think most of the YouTube that I hear is about Harsha Bogle speak about cricket. I am a regular consumer of Cricinfo and Cricbuzz.

Sajith: Good stuff.  Okay. So, I think you’ve covered most stuff. So, I’ll just stop recording. Thank you for this, Arindam.