The online meat ordering and delivery market in India has been growing in leaps and bounds over the last few years, with the coronavirus pandemic giving the startups in the segment a major boost. D2C meat and seafood startup FreshToHome, which completed its last fundraising at the end of 2019 — the largest Series C fund-raise in Indian food tech — and is purportedly eyeing a Series D funding round at a post-money valuation of over $1 billion, has become rather aggressive in its expansion and communication drive in recent months. Shan Kadavil, co-founder, spoke to Alokananda Chakraborty about its recent moves.
E-commerce players, especially those in the food business, are in a race to deliver orders as quickly as possible. You already have a 90-minute delivery option; can you go any faster? What sort of capabilities do you need to shorten the delivery window?
We work with our partners to deliver in under 90 minutes, and 60 minutes in some regions, which we are certain is the optimal time to deliver with customer convenience and the safety of our delivery executives in mind. We are working on bringing down the 90-minute option to 60 minutes, and in the next 12 months, we target to reach this in all regions. However, we will not be participants in the 10-minute or 15-minute race game. Furthermore, the use of technology has been game-changing for us for demand planning in geographies, routes, and ETA (estimated time of arrival) of orders.
One would assume metro markets were easy to break in with non-vegetarian food items, but you still had the onerous task of market creation. What were the early hurdles? How did you get around them?
The market for non-vegetarian food and food products has always existed, regardless of the metros or smaller cities. As a D2C brand that enables the delivery of only fresh and chemical-free fish and meat online, the onus was on us to make consumers aware, and help them in making informed and conscious purchases. Our fundamental commitment to the unique brand assurance of 100% fresh, 0% chemicals played a vital role in drawing the attention of new customers in our early days. As a result of word of mouth, customers started associating purity and safety with us, and it helped us scale robustly. The lockdown period gave a fillip to our sales, resulting in rapid growth. Customer loyalty has further propelled our growth and our current customer retention rate is over 85% in most markets. We have grown 3x in the last two quarters alone and we are now present in over 200 cities and towns, across 2,800 PIN codes.
We are able to provide a fish caught at 4 am in the morning in Cochin by air to a customer ordering at 11 am in Jaipur or Delhi within 24-36 hours — that’s a very hard proposition to beat in terms of freshness.
How has the response been in the smaller markets you are getting into now? Are people open to buying meat or fish online, without the privilege of touch and feel?
It is encouraging to see smaller cities increasingly turn towards online delivery for fish and meat. When we started operations in smaller markets like Warangal in Telangana and Kottayam in Kerala, we were apprehensive because of the sheer market size. However, we were pleasantly surprised by the customer turnaround. Three months into the operations, we were delivering over 400 orders per day in Warangal, Kottayam and other centres. We have witnessed 6x growth in non-metros in the last quarter. Recent trends have shown meat lovers, irrespective of the region, are open to exploring new platforms where there is an assurance of quality and reasonable pricing. In 2021 alone, we onboarded more than 800,000 new customers, and we are currently enabling the delivery of over 2.5 million orders per month across all product categories.
You were also planning to get into the ready-to-eat segment. Where does the plan stand now? What sort of work and competencies do you require to put a ready-to-eat (RTE) edifice in place?
The RTC (ready-to-cook) and RTE category is a huge opportunity for us. One of the biggest fears or barriers for this category is the use of preservatives. While consumers are now a lot more open to trying ready-to-cook and ready-to-fry products, the fear of preservatives and artificial additives is also what keeps them out. We have differentiated by making available “India’s only clean label”; the RTC offering is strongly poised to create a new category based on consumer needs. When you look at the product range made available by us, it’s the only range in the market without an E number, that is, any added preservatives or artificial additives. Our goal has been to make recipes available and launch dishes made from ingredients that are available in your own kitchen.
We have made a plethora of offerings available to cater to every time-of-day need of the consumer. Cold cuts for breakfast, crispy snacks and momos for in-between meals, starters for parties, curries and biryanis for mains — we have it all. A few months ago, we enabled our partners to roll out six new products under our ready-to-fry range. It took nearly 18 months to create a clean-label meaty snack range. We have recently launched sausages and cold cuts, and this again is the only clean label cold cut range in the country. There are no nitrates, no phosphates, and no artificial food additives in our sausages and salamis. The products are made using organic coconut vinegar and salt in our ready-to-eat meat pickles, while most brands in the market use synthetic vinegar as a preservative. Thanks to a strong NPD team with a state-of-art development facility to enable this.
Your new campaign with Ranveer Singh keeps harping on “no compromise”. What is the larger message and how effective has that piece of communication been?
We began our journey with the desire to find safe and hygienic fish and meat that was safe for all to consume. Going against the norm isn’t easy, but we are steadfast in taking no shortcuts as we go the extra mile directly to source from farmers and fishermen through our partners, to give consumers the freshest chemical and antibiotic residue-free meat and seafood. Our platform vendors have complete control over the supply chain, and this translates to the fact that consumers now have access to fish that has been caught in less than 24-36 hours, and the meat is antibiotic residue-free.
Now, if you look at our #NoShortcuts campaign, it’s an encapsulation of everything we do and what we represent. We don’t cut corners, we don’t take any shortcuts, we do things the right way, not the easy way. The campaign has been received well by consumers and we have seen a positive movement on all key metrics like new users, traffic as well as a significant rise in awareness level.
Beyond the metrics, what gives me the greatest satisfaction is that we have been able to educate consumers on eating healthy food in a sustainable manner — that trumps any other achievement.
You say your Ranveer Singh campaign has done its job. Fine, but now, with so many curbs in place with respect to misleading communication and making ambassadors accountable, do you think going forward, we will see less celebrities in ads?
I am not sure about fewer or more celebrities, but I am certain that the new guidelines on celebrity endorsement would be beneficial to all and would safeguard everybody’s interest. With celebrities needing to do their due diligence for the claims they endorse, there is also greater responsibility on brands to furnish them with all facts and figures.
I am seeing this as a positive because it’s a genuine, honest endorsement by the celebrity, leading to more credibility for the brand, and greater confidence in the product and brand for the end consumer. It’s definitely a win-win situation for all. In our case, Ranveer’s household was our customer and he spent considerable time with us before he agreed to be a brand ambassador, since it stemmed from his belief in the product and our sustainable sourcing, free of any chemicals.
So when are we going to see you in the unicorn club?
Our last fundraising was during the end of 2019, which was the largest Series C fund-raise in Indian food tech. We haven’t needed additional capital, thanks to our superior unit economics. If and when we do, I am sure the results will be very positive. But as a serial entrepreneur, I have always believed in focusing on the customers versus on fundraising, since everything else will flow once you have customers loving you.
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