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All content following this page was uploaded by Chetna Kudeshia on 03 September 2020.
Chetna Kudeshia and “Hi Vivek, Your company ‘Chumbak’ has been selected, and you’d be one amongst the three
Arun Mittal are Research firms worldwide that will be a part of the Google case study!” This was the email that
Scholars, both at Birla husband and wife team Vivek and Shubhra Chadda got from the California-based company
Institute of Technology,
known as Enso, who was working with Google to make a case study video on how firms
Extension Centre, Noida,
India.
worldwide are using Google services. They were looking for businesses that had a
“compelling business, web and a human story” and Chumbak fulfilled all the requirements.
However, this wasn’t the case just a few of years previously when Shubhra and Vivek had
to sell their house for Rs 40 lakhs to raise seed capital for the venture. Chumbak “which
started as an absolutely self-funded company without any financial liabilities” was now
being banked by the big financial companies of India. But how did it become possible for
a self-financed company with a meager investment to incur a place on a Google case study
that was being conducted jointly with Facebook’s study about advertisement success
stories? The had company broken even after three years of trading and was presently
pumping all of its profits into the business and the success of Chumbak can be attributed
to social media. Social media was responsible for all aspects of Chumbak and its success,
from brand identity to brand awareness, from campaigns to recruitments. What started as
a store for magnet souvenirs now offers a line of products including apparel, accessories,
stationary, home and style products.
Introduction
The definition of business in India has changed from having a shop or manufacturing unit
to discovering and creating a strong online identity for brands. One necessary
phenomenon is maintaining personal and steady relationships with customers. Even if a
business is being set up or expanded through modern technologies, such as the Internet,
the basis will always be the same – better engagement with your customers. The only
difference will be the medium of establishing that engagement and it is not surprising that
this philosophy is widely being accepted by many small and medium-sized businesses as
a function as their business strategy.
One drawback that small business face is-competition from medium-sized and large
Disclaimer. This case is written businesses. Additionally, there is very little funding at the disposal of these businesses for
solely for educational promoting functions, which may greatly hinder a small businesses ability to reach an
purposes and is not intended
to represent successful or oversized audience. Unlike established businesses units that may already have a good
unsuccessful managerial reputation, a large customer base and high brand recognition, small and medium-sized
decision-making. The author/s
may have disguised names, businesses need newer, innovative avenues for building their brand, to reach out to every
financial and other prospective customer and creating better and strong relationships with the customers once
recognizable information to
protect confidentiality. the relationship has been established. Online promoting now plays a vital role in
DOI 10.1108/EEMCS-09-2014-0209 VOL. 5 NO. 4 2015, pp. 1-24, © Emerald Group Publishing Limited, ISSN 2045-0621 EMERALD EMERGING MARKETS CASE STUDIES PAGE 1
establishing small-scale businesses, and gives them the advantage of being able to run
favorably alongside their larger counterparts.
As per the Micro, Small and Medium Enterprises Development (MSMED), 2006 Act of India,
a small or medium-sized enterprise (SME) is an one where the investment in plant and
machinery is more than Rs 25 lakh but does not exceed Rs 5 crore [22]. A significant
17 per cent of India’s GDP come from its 40 million SMEs. A recent report by McKinsey says
that the SMEs who are highly active on various social media avenues report double the
revenue growth of those who are not using it. Out of the 40 million small entrepreneurs,
around 500,000 SMEs, have a strong presence on social media (McKinsey Global Institute,
2012). A report by Assocham and Comscore (2012) says that Internet users in India are
expected to reach between 350 to 450 million by 2015-2016, and this will act as a catalyst
in the growth of SMEs (Batra et al., 2012).
Social media statistics in India:
India has 243 million Internet users.
Facebook is the most browsed social network on social media with a large base of 100
million users.
India has 33 million Twitter users.
LinkedIn has 26 million India users, of the total 300⫹ million users.
Of the total 70 million total users of Pinterest, 5.5 million are from India [source: www.
digitalinsights.com (accessed 9 August 2014)].
Small businesses in India are integrating social media in their marketing strategies for
better collaboration, engagement and effective communication. From the company
websites to the blogs, from social networking sites to the content communities, these social
technologies are helping the businesses to reach the most influential audience giving a
stronger brand impact.
On the same notion, in March 2010 Vivek and Shubhra Chadda started Chumbak, a
Bengaluru-based souvenir startup popular among the age group between 18 to 24 years.
Vivek, the Chief Executive Officer and co-founder, and Shubhra Chadda, Head of Product
and Design, had successful corporate careers before they founded Chumbak. Shubhra
was associated with KPMG, Nortel and NetApp before the launch of Chumbak and Vivek
worked for various brands and had over 16 years of experience in retail marketing. During
his time with Tanishq, Vivek was an important part of its initial brand team responsible for
the company’s turnaround. He was then associated with Platinum Guild International as
head of their south markets looking after retail marketing. He joined as the head of modern
trade marketing at Motorola, and worked in setting up Moto Stores across India. In his last
and final corporate role he was head of Partner Marketing at Sun Microsystems.
The idea
The Chadda’s loved to travel and each time they travelled, they would shop for souvenirs,
especially fridge magnets. As they were usually on a small budget, they found that fridge
magnets made appealing and affordable gifts to friends and family back home. While
varieties of such products were available abroad, in India, buying mementos was restricted
to options such as pashmina shawls, marble miniatures of the Taj Mahal or brass elephants.
“Why don’t we get these fridge magnets in India?” Shubhra asked Vivek, and the duo
started searching for India-made fridge magnets but they could not find fun fridge magnets
in India and Vivek and Shubhra soon realized that affordable, well-designed and crafted
products that could be used as accessories and gift items were in demand. Why don’t we
start making our own fridge magnets and add a bit of color and modernity to the market of
Indian trinkets? And thus came the idea of Chumbak! In 2004, the couple started doing
some initial research and, finally, in 2009, spent a good six months researching various
Chumbak is a leading design company and they take great care about how they look, from
their office to kiosks and to products. The originators, who conceived the workplace
themselves, settled on an open-plan arrangement office with only two encased rooms that
are implied for imaginative conceptualizing and gatherings.
Chumbak required the work environment to be open. “We didn’t require anyone to need to
thump on ways to meet “the boss”, “said Vivek. In spite of the fact that their organization’s
items have a tendency to be jumbled with pictures that summon India, such as the auto
rickshaw and dairy animals, the originators chose to be moderate in the workplace. The
creativity of the founders is reflected in the Technicolor item tones emerging in the pink and
blue seats and the blue-green pin sheets. However, style wasn’t the sole concept on their
mind. Shubhra and Vivek additionally ensured that the workplace is energy efficient. The
organization utilizes window air-conditioning systems that cool the area of workplace being
utilized at a given point of time. To scale back temperatures within the warehouse they have
spinners on the roof and upside-down clear PVC panels let in light throughout the day.” We
don’t have to switch on the lights until around 6:30 at night. Our power bills are low”, said
Vivek.
Funding
The unique designs of Chumbak have attracted favors from private equity investors and
funds from venture capitalists. As the brand was being established and there was
acknowledgment from various areas, Chumbak got funding by Seedfund in 2012 and from
Matrix Partners. Rishi Navani, co-founder and managing director, Matrix India, says, “The
entrepreneurs, Vivek and Shubhra, have a unique mix of design sensibilities and strong
business acumen (Rebecca, 2011).” Revenues for Chumbak in 2010-2011 stood at Rs 1.25
crore, however, online sales account for 15 per cent of revenues.
One of the fun, creative things Chumbak did was to encourage participation from its fans.
Chumbak always believed that its communication would never be one way. They are very
conversational on this platform and the communication topics range from movies to rain in
Bengaluru to spontaneous quizzes to talking about social issues and many more subjects.
Chumbak held a Weekend Contest every week to encourage fans to participate. Chumbak
founders have been using Facebook as an interactive forum to engage with the customer
base, treating them like a community of friends. Vivek says “Interaction with customers is
Community pages
Visuals (photo’s)
Blogs
Social media
Chumbak marketing Polls & games
Campaigns
Table IV Which is the most preferred social media platform to interact with Chumbak?
Source of information Frequency (%)
Approach
Chumbak uses Facebook as its sole marketing channel for building community of
Chumbak-passionate users who love the brand. Chumbak created a Facebook page that
is very colorful, very suitable for its brand personality.
Content marketing
Don’t use social media always to push your product as your customers want to listen to
something closer to them, is what Chumbak believes:
Don’t push your product/service.
Talk about what drives you.
Social care
“Social care” is defined as how much the company is embracing the opportunity to provide
customer support using dedicated social media channels like Facebook, Twitter and blogs.
The more your company can solve queries through these tools, the more you will be
engaged with your customers in a better way. Facebook is the most used social media
platform for interaction by Chumbak to solve its customer’s queries.
Keep on asking
Chumbak tries to involve with its customers in the most possible ways as per them
crowdsourcing is the best way to know your fans. They conduct polls, use apps such as
Survey Monkey to know what their fans like about Chumbak and what they want from the
business to do for them next.
Recruitment
Social recruiting is the latest and most discussed recruitment method. Recruitment through
social media is not only cost-effective but it gives a company a wider choice and this is
Chumbak motivation for placing ads on Facebook.
Results
30 per cent of online revenue of Chumbak comes from Facebook, with a very high
degree of 25 per cent repeat purchases among page fans.
5X ROI on total advertising spend with Facebook.
30-40 per centof website traffic of Chumbak comes from Facebook (YouTube video of
Chumbak).
Twitter
With around 2,776 followers and 5,306 tweets on Twitter, Chumbak does an excellent job
by maintaining replies, retweets and hashtagging. Vivek says that Twitter is a platform a lot
of recommendations are made and Chumbak’s customers can subscribe to its
e-newsletters. Chumbak shares a range of quotes, articles and media that its followers love
to watch and share. With the magic of 140 characters Twitter connects Chumbak to its
customers in real time, and it uses Twitter to quickly share information with the people that
have an interest in their product. Through Twitter it tries to assemble real-time market
intelligence and feedback and build relationships with its customers, partners and
influencers. Chumbak contains an effective method of including links in nearly each single
tweet, sharing its achievements. By including links of the varied interviews and videos of
YouTube featuring the company, Chumbak continually offers its followers something to
engage in. Chumbak talk, share and post photos and this ultimately provides positive word
of mouth to the brand at nearly zero cost. Keeping your followers interested is essential for
maintaining a strong social network, and this is why Chumbak uses their Twitter feed to
keep their followers up-to-date concerning new product arrivals and present offers. Twitter
offers Chumbak an easy way to reach an engaged audience in an effective manner and the
company remains consistent with its tweets, using a variety of videos, links and images.
Pinterest
Pinterest has become a strong tool for Chumbak to garner time period insights, share
knowledge and influence content creation and amplification. With 10 boards being serious
on visual content, Chumbak tries to own a group of pleasantly colored pictures and
merchandise to feature on Pinterest. Through Pinterest, Chumbak tries to keep it simple for
individuals to find and share its products. Pinterest reworked the way Chumbak is
concerned with its content selling. By generating content on Pinterest on an everyday
basis, Chumbak can connect with a new audience by showing off their latest collections
and a few digital art galleries through varied and simple visible classes. Chumbak
undoubtedly has become a good place for shoppers to search out completely different
merchandise for all of their desires and their Pinterest account lays out the products in a
visually friendly style.
YouTube
YouTube, the first major video hosting and sharing site, helps Chumbak in engaging with
its customers by uploading its attractive videos. These 10-minute videos uploaded can also
Instagram
Chumbak uses Instagram to reach its customers in a fun way by taking pictures of its
products, daily activities and offers. By sharing their activities and products on various
social media sites it gets engaged with its customers in a better way.
Google⫹
Chumbak uses their Google⫹ presence to post images that show the value of their
products rather than just tell it. It consistently uses Google⫹ for promoting their latest
products as well for interactions with their potential, as well as existing, customers. The
regular posts on this social media tool help Chumbak get engaged with its fanbase.
Challenges
Keeping up with the changing tastes of its young clientele is a real test for Chumbak. The
hybrid model – its online, as well as offline presence – has helped the company in keeping
itself abreast with the fluctuations of the demand. The company wants to increase the
contribution of its online sales to its overall earnings to at least 30 per cent currently, online
sales account for about 15 per cent of total sales and is, therefore, focusing on various
technological platforms. Furthermore the organization feels that, it’s essential for them to
understand the type of dissemination to be the future standards – offline or more of online.
The third challenge for the organization is costly land; Chumbak is attempting to handle this
by opening more modest stores – 150-200-square feet, rather than standard business
spaces of 1,000-square feet. The company currently has 20 stores and kiosks across five
cities, along with the presence in about 60 multi-brand outlets.
Mumbai, New Delhi and Bangalore contribute 60 per cent to Chumbak’s total sales. The
other challenge for the company is to gain acceptability in emerging metros and smaller
towns as it expands. It also needs to be aware of the competition. Companies such as India
Circus and Happily Unmarried which have a heavy fan following on social media platforms
such as Facebook are already making inroads and have similar design aesthetics.
Facebook 7.9 3
YouTube 8.4 4
Twitter 6.1 12
Pinterest 8.9 17
Source: Compiled by authors from www.alexa.com/topsites (accessed 9 May 2014)
Conclusion
According to PWC (2014), 60 per cent of consumers use social media to follow, discover
and give feedback on brands and retailers. A recent survey by a USA-based consumer
data collection company Datalogix showed that 70 per cent of Facebook campaigns drove
at least three times the return on investment while almost 50 per cent received a five-time
return (The Economic Times, 2014b). A recent report from LinkedIn discovered that 80 per
cent of small-scale entrepreneurs are turning to online networking stages to produce
income and discover new customers. According to the report 73 per cent of
high-performing small organizations say they expanded using on online networking and
social advertisements. Upon further examination, it can be seen that just 42 per cent of
small organizations encountering no development did likewise (LinkedIn, 2014). The
fast-growing small businesses report social media to be an effective marketing tool. Nine
out of 10 says their social media efforts help maintain a company presence and identity,
while 82 per cent says the platforms help generate new leads (LinkedIn, 2014).
The tremendous range offered by online networking has surprised small-scale businesses
and made them more aspiring (Table VI). Companies have understood they require the
stage of social networking to get by as well as to win. Chumbak is the dream of
Keywords: husband-wife duo Vivek and Shubhra Chadda and is currently a fruitful brand that would
Facebook, not have been conceivable without online networking. Engagement through social
Small business, networking is basic for any business that wishes to be seen as modern and part of the new
Social media, digital age. Chumbak is wonderfully achieving this and has accepted the fact that, although
Customer engagement, the spot and strategy for working changes with mechanical headways, eras and changing
Chumbak, decisions, one thing that never shows signs of change is the acknowledgment that the
Social media marketing customer is always the king.
References
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2014).
Batra, R., Ahuvia, A. and Bagozzi, R.P. (2012), “Brand love”, Journal of Marketing, Vol. 76 No. 2,
pp. 1-16.
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Management, Vol. 23 No. 3, pp. 344-361.
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social technology”, available at: www.mckinsey.com/.../media/mckinsey%20offices/.../the_social_
economy (accessed 28 March 2014).
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PWC (2014), “Social media: the future of customer relationships”, available at: www.pwc.co.uk/.../
social-media-the-future-of-customer-relationships (accessed 4 May 2014).
Rebecca, L. (2011), “The woman entrepreneur at chumbak: Shubhra Chadda”, available at: http://
youtu.be/XluDONZFPss (accessed 2 March 2014).
Reitz, A.R. (2012), “Online consumer engagement: understanding the antecedents and outcomes”,
PhD dissertation, Colorado State University, Fort Collins, CO.
The Economic Times (2014b), “Bright & Airy: why kitsch design company Chumbak opted for an open
plan office”, available at: http://articles.economictimes.indiatimes.com/2014-03-01/news/47799637_1_
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Further reading
About Chumbak, available at: www.chumbak.com/about-chumbak.html (accessed 4 February 2014).
Anandan, R. (2014), “Indian entrepreneurs should stop worrying about failures – the Economic Times
on mobile”, available at: http://m.economictimes.com/opinion/guest-writer/rajan-anandan-google-
india-vp-md-indian-entrepreneurs-should-stop-worrying-about-failures/articleshow/msid-31911842.
cms (accessed 23 March 2014).
Cool Age (2013), “Chumbak: from fridge magnets to business magnates”, available at: www.coolage.
in/2013/10/16/chumbak-story-of-the-kissing-stones/ (accessed 1 February 2014).
The Enso Blog (2013), “The web is working for global small business”, available at: http://blog.
helloenso.com/post/52915582314/the-web-is-working-for-global-small-business (accessed 2 March
2014).
Entrepreneur India (2013), “Seed fund invests over $2 million in Chumbak”, available at: http://
entrepreneurindia.in/thebuzz/specialreport/seedfund-invests-over-2-million-in-chumbak/18421/ (accessed
4 May 2014).
Huang, E. (2013), “Chumbak saw a diamond in mere rocks, now in India and Japan”, available at:
http://e27.co/chumbak-saw-a-diamond-in-mere-rocks-now-in-india-and-japan/ (accessed 24 April
2014).
IBNLive (2013), “Indian startup Chumbak exploits the web to create a niche market”, available at:
http://ibnlive.in.com/news/indian-startup-chumbak-exploits-the-web-to-create-a-niche-market (accessed
20 February 2014).
Pagemodo (2014), “Facebook is still king among small business owners [SURVEY]”, available at:
www.pagemodo.com/blog/facebook-king-small-business-owners- (accessed 25 March 2014).
PWC (2013), “In-store shopping still center of shopping experience”, available at: www.pwc.com/.../
pwc-annual-survey-of-online (accessed 6 May 2014).
Reserve Bank of India Report (2014) available at: www.rbi.org.in/scripts/FAQView.aspx?Id⫽84
(accessed 3 February 2014).
Social Samosa (2013), “Why is chumbak a lovable start-up brand on social media?”, available at:
www.socialsamosa.com/2013/09/chumbak-start-up-brand-social-media/ (accessed 2 February 2014).
The Economic Times (2011), “Chumbak: Shubhra Chadda pull in profits by quirky India-centric
souvenirs”, available at: http://articles.economictimes.indiatimes.com/2011-11-28/news/30450424_1_
fridge-magnet-souvenirs (accessed 11 March 2014).
The Economic Times (2013), “5 women entrepreneurs who have defied myths & handicaps”, available
at: http://economictimes.indiatimes.com/slideshows/biz-entrepreneurship/5-women-entrepreneurs-
who-have-defied-myths-handicaps/slideshow/19124951.cms (accessed 2 April 2014).
The Economic Times (2014a), “Small companies market themselves on Facebook and seal deals via
WhatsApp”, available at: http://articles.economictimes.indiatimes.com/2014-02-5/news/47670597_1_
whatsapp-facebook-page-mark-zuckerberg (accessed 2 May 2014).
The Hindu Business Line (2014), “Quirky, magnetic, very Indian ‘they are the couple who sold a house
to live their entrepreneurial dream’”, available at: www.thehindubusinessline.com/features/blink/work/
quirky-magnetic-very-indian/article5757185.ece (accessed 3 April 2014).
Tribune India (2013), “The tribune, Chandigarh, India – trends”, available at: www.tribuneindia.com/
2013/20131102/trends.htm (accessed 4 April 2014).
Twitter page of Chumbak, available at: twitter.com/Chumbak (accessed 15 March 2014).
Your Story (2013), “Lessons for entrepreneurs from Chumbak – an ‘attractive’ Indian venture”, available
at: http://yourstory.com/2013/02/lessons-for-entrepreneurs-from-chumbak-an-attractive-indian-
venture (accessed 1 March 2014).
YouTube video of Chumbak, “Chumbak makes the web work for them”, available at: http://youtu.be/
1EhsNFOA9ew (accessed 19 February 2014).
Figure E1
Plate E1
Figure E2
Figure E3
Figure E4
Figure E5
Quick note on ecommerce deliveries: Hello just wanted to personally update you on some of the
delivery issues we’ve been having for the past couple of days at Chumbak. Some of your orders
have been delayed. So I thought I’d write a quick note to tell you why in the past couple of months
we’ve been seeing much larger traffic and increased orders on Chumbak.com. And for that, on
behalf of all of us at Team Chumbak, I’m sorry. I truly am. We have ramped up stuff and you won’t
have any more cause to get stressed. Here’s looking forward to crazy loads of smiles and love
from you guys. Vivek (the guy who makes the whoosh sound, Team Chumbak).
Source: Screenshot (Chumbak Facebook fan page)
Figure E6
Exhibit 9. Chumbak does the subsequent to win back its customers through
Pinteres
Figure E7
Corresponding author
Chetna Kudeshia can be contacted at: ckudeshia@yahoo.com