Sameer Maheshwari is the Managing Director & Co-founder of HealthKart.com, an e-health store. Prior to founding HealthKart, Sameer worked at UBS Investment Bank in San Francisco for two years, where he provided M&A and capital markets advice to internet and digital media companies. Recently, HelathKart had acquired another fitness goods e-tailer MadeInHealth, following their $ 7.5 mn fund raise from Sequoia, Omidyar and Kae. In an exclusive interview with India Digital Review, Maheshwari discusses his company’s plans going forward.
What was the idea behind launching HealthKart.com? What was the objective behind choosing health products as an ecommerce category in India?
HealthKart is an ecommerce company focused on consumer healthcare products. We sell over 12,000 fitness, health and personal care products across various health categories such as Nutrition, Sports and Fitness, Diabetes, Home Devices, Eye and Personal Care. We started HealthKart when we realized that internet/ecommerce was on the cusp of growth explosion, and it presented a viable medium of distributing thousands of consumer health products in a country, where organized retail such segment is mere 3 per cent. HealthKart’s objective is to become go-to online destination for consumers for all their healthcare needs, we offer three-fold benefits to consumers - a) Authenticity – given the large counterfeit / grey market of healthcare products in the country, assurance to get genuine products, b) Assistance - proper education about the available products before purchase, and c) Access – one-stop-shop for getting maximum product range from any part of the country.
How many transactions happen on HealthKart on a daily basis and what is the approximate daily revenue earned?
We have grown rapidly – almost 30-40 per cent month over month – since we launched last year. We have processed ~60k orders till date and ship approx 800-1000 products on any given day.
What are your plans with MadeInHealth now? Will this operate as a separate entity or will this be merged with HealthKart? Any further acquisitions planned?
MadeInHealth is a very strong community of fitness enthusiasts. We plan to provide the strong eCommerce backend that we have created at HealthKart to provide a) access to vast variety of global supplement brands, b) fast shipping and additional payment options, and c) value added services, such as free diet counselling, to MadeInHealth customers. MadeInHealth would continue to operate as an independent brand. We don’t have any additional acquisitions planned in the near future.
What are the most preferred product categories on HealthKart?
Nutrition, Diabetes and Home Devices are our top selling categories. Sports supplements, vitamins and minerals, glucometers and blood pressure monitors, are some of the key products that we sell under these categories.
What is the share of rural and urban orders coming to your portal?
Our sales are pretty balanced nationwide, with a strong demand from both urban and non-urban population. Approx 50 per cent of our sales is outside the top 7 metro cities. Tier 2/3 towns is definitely a promising territory for us as more and more people in these cities are getting online, and with their increased consumption power they have the desire to access great products, which are not available in their towns easily.
In how many cities does HealthKart operate?
We have pan-India distribution of our products. On any given month, we ship to over 400 cities.
Recently, when you had raised $ 7.5 mn from Sequoia, Omidyar and Kae, there were reports that you are going to launch an online magazine. Can you please share your plans and idea on this?
We did launch an online magazine, HealthViva, earlier this year. The online magazine is a mechanism for us to create health focused user community. We have a dedicated team of writers who create content on various kinds of health topics. We have several engagement and social features enabled on the website, such as ability to write and share feedback on articles etc, which will allow us to be thought leaders in health space.
What are your thoughts on competition in the market and how is HealthKart different from the competitors?
There isn’t any comparable health focused eCommerce player, but we do have category specific competitors, such as FirstCry.com, BabyOye.com etc in certain categories we operate in.
Our focus on health and customer centric approach differentiates us. Healthcare is one area where significant education gap exists among the consumers. We differentiate by offering tremendous assistance to the consumers throughout their buying process. We house trained experts in our call center who provide specialized support to customers. As an example, we have nutritionists available on chat, email and phone, whom customers can contact to seek free diet counselling and understand which products would be required for their profile. Besides customer assistance, our ability to guarantee product authenticity also differentiates us. Given a large grey/counterfeit market of health products in India, our ability to procure from authentic sources only, is a big factor for consumers to transact with us.
What are your priorities in the company now?
We hope to scale our business multi-fold in years to come and become the go-to destination for consumers for all their health needs. To achieve this, we will continue to increase our product depth (introduce more and more products in the categories we are in) and also introduce adjacent categories.
How do you see the revenue growth of HealthKart so far? What are your expectations this year?
Since we launched last year, we have continued to grow at a rapid pace of 30-50 per cent month over month. Given that the market we operate in, is a $15-20 billion market, we don’t envision slow down of this growth. We expect to be 5-7x of our current size in next two years.
Will we see HealthKart diversifying into other categories as well?
While our current focus is existing categories, we are also exploring adjacent categories, such as medicines, clinic supplies etc.
A lot of ecommerce brands are being created via extensive marketing. What are your marketing plans for HealthKart?
Our marketing efforts are largely focused on online advertising and social media. We get a lot of customers through good word of mouth – our happy customers are our best advertisers. Besides, we employ online marketing channels like Google, YouTube and Facebook. Our health magazine, HealthViva, also has started generating referrals.
If 2011 was a year of ecommerce companies being funded, 2012 will see consolidation. What are your thoughts on this statement?
As the industry matures, consolidation is likely to continue in the space. Consolidation allows synergies, both in customer acquisition as well as operations. We believe that there would be 2-3 horizontal players (category agnostic) and 4-6 vertical players, such as ours, in the long run.
What would be your suggestion to somebody who is willing to setup in an ecommerce startup?
Ecommerce is definitely the new-age retail model, which is there to stay in the long run. Anybody who is contemplating to start something, our recommendation would be to evaluate the category and capital requirement for jump starting the model. Category evaluation has to be done on the basis of long term profitability and various factors such as revenue scale, margins, shipping costs etc should be considered. Given that ecommerce is in nascent stages, capital requirement shouldn’t be properly evaluated to get the business to cash flow positive state.
