e4m Conclave South: We are growing at CAGR of 30% a year: K Madhavan, Peps Industries
Managing Director, Peps Industries delivered the valedictory speech at e4m Conclave South speaking on his entrepreneurial journey with Peps mattresses at the age of 55
Peps Industries' Managing Director, K Madhavan, delivered the valedictory speech at exchange4media Conclave South 2018 in Bangalore. The theme for the event was centred on the topic ‘Emotional Connect and Distracted Consumer’.
Watch the session here and scroll down to read:
Madhavan began his session with a small introduction of himself and about his entrepreneurial journey with Peps mattresses at the age of 55. He was working with a mattress firm for 30 years and realised that he needs to come out of the comfort zone to start his entrepreneurial journey.
“I work in a field where the customer interaction with the product is almost zero. The product doesn’t create any enthusiasm within the customers to buy the products. I am working in a segment which is the toughest segment anybody could ever prefer to work in,” said Madhavan in his opening speech about the mattresses industry.
The journey of the brands called Peps began in the year 2005 when he cashed on a golden opportunity and took over a metal spring mattress manufacturing unit that was for sale. He converted it into a profitable unit.
“Mattresses industry works on a paradigm of leaders and followers. You have one leader in the industry and all others follow them. Creating customer enthusiasm was tough job during initial days. We had only one option to curb the situation, be innovative and capture the market,” said Madhavan.
As a first step towards it he signed a licensing agreement with Restonic, the fourth largest spring mattress brand in the world for 30 years. “We started producing mattresses of international standards and modified the mattresses suitable to the taste of Indian customer. We priced it in such a level that the price was comparable with the conventional mattresses and made it easily available to the customer,” explained Madhavan.
“In 2005-2006 we manufactured 4000 mattresses and the average revenue was Rs 4 crore. We scaled up and now we produce 3,50,000 mattresses per year and our revenue for this financial year 2018-19 is poised to reach closer 425 crores as of today. We are growing at CAGR of 30% a year,” added Madhavan.
“We produced a product, made it a brand and placed the brand at the bottom of the market. As we did it, we displaced the competitors and at some point, we made ourselves as the brand leader. This is a classic example of an Indian company disrupting an industry,” said Madhavan.
The next challenge he faced was to educate the customers about the product. While the competitors spoke about the product features, Peps highlighted its features and communicated its core value to enable great sleep.
“The consumer connected with us as a brand only because we were able to connect with their emotional need to have restful sleep. Very soon, other players also started talking about the need for great sleep. We lost the plot with our customer then, then we ideated on what happens when you get a good sleep, you wake up refreshed. And that became our key focus of communication. At a time when other brand campaigns spoke about sleeping well, our focus was to highlight the importance of waking up fresh ,” said Madhavan.
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