The Great Indian Struggle

The India of the 21st century has always been eager to get on its 2 feet and make a life of its own, oftentimes away from their hometowns and the support of the local community. However shifting to a new town brings with it the humbling realities of cleaning bathrooms, leaky taps, broken cupboards, and a messed up sofa in the living room and running after 3 different blue-collared people to fix them. This was the struggle of every young Indian who wanted to ascend in their lives, but the support system at their new homes was just not present.

The Product

Then comes the year 2014, when all of this was going to be changed by:

Started in the year 2014, Urban Company is an all-in-one platform that helps users hire premium service professionals, from beauticians and masseurs to sofa cleaners, carpenters, and technicians.

Urban Company primarily solves for 3 core things when it comes to Home Services:

Transparency, Credibility & Reliability.

Transparency in Pricing & variety of services available

Credibility of the skilled professional in dealing with the problems

Reliability of their service and arrival on the promised date & time

• Served over 5 Million customers across India, Dubai, Abu Dhabi, Sydney and Singapore
• 10 Million+ Downloads on the Google Playstore with a 4.7 star rating (1.2M reviews)
• Their app on the Apple Appstore has a 4.7 star rating (672K reviews)
• Raised more than $440 Million in Funding across 11 rounds. Valued at $ 2.8 Billion (FY'22)
• Has over 25,000+ skilled professionals providing a multitude of services
• 25 Training centers in India with 100+ trainers
• UC Partner App Downloads: 1 Mlillion+ (Android)
• MoU with the NSDC to mobilize, train, and certify service professionals across India

Product Selection - Is Urban Company (UC) ready for Acquisition?

The User

The ideal ICPs for this particular project were chosen on the basis of a 3 step filtration process:

1. A simple poll was conducted on my Instagram page (50+ participants). Results:

2. In-depth User Interviews with 9 people:

The user interviews were held with a variety of people living in metro & tier 2 cities and with varying professions, lifestyles & product usage patterns. Some of them are low infrequent users and some are extremely regular and high users. Astonisghly some have been regular users of the product for multiple years now. Safe to say the brand has a very high customer loyalty given how grave a problem it solves.

The Questionnaire was divided into 4 in-depth questions of which users gave answers on text & voice notes and the rest of the questions were collected in a Google form survey:

All the survey results are available in this Google Doc here.

3. The Ideal Customer Profile (ICP) Prioritization:

From this we get our 2 ideal customers, let's learn a little more about them.

• Rameya: She is a young working professional who has just completed her master's and is living in Bangalore with a few flatmates in the Bellandur area. Ever since she started working she found it tedious to find a good salon/spa, but her good friends recommended she try out Urban Company for their safe and economical salon at-home services. She now no longer has to step out for a good service in the infamous Bangalore traffic. Rameya also discovered that she could get a variety of household work like deep cleaning, Fridge repair, carpenter & plumber stuff done from UC and knows she's gonna get the best & most reliable service. She forms an Ideal ICP due to her high-frequency use of the salon almost every month, being tech-savvy, and having the means to pay. This type of ICP (Young ambitious females working away from home) has a huge Total Addressable Market and is easily reachable via social media channels like YouTube.
• Purvi: She is a mature & married HR professional working in tech companies. She is well-settled and comfort & convenience are her biggest priorities. The first time she stumbled upon the UC app was when she was looking for a good salon service from the comfort of her home. She tried it and was very satisfied with their service. This was a few years ago and she has been a regular and frequent user of UC. However since she and her husband are a working couple, they find it difficult to make time for household chores. Therefore off-lately UC has been helping them with all their home cleaning & appliance repair needs from time to time. And when festivals are around the corner, they just have to get the house deep cleaned with Urban Clap for a clean & fresh home. Purvi forms an Ideal ICP due to her regular use of UC's home cleaning & repair services, being tech-savvy & having the means to pay. This type of ICP (Young working couple living in metro cities) has a sizeable TAM com & is easily approachable via organic channels like Google search.

The Market

Now that the ICPs are defined, let's take a look at the field in which Urban Company plays.

Home Services Market

• The HomeServices market is pegged to be about 100 Billion in India with the majority of it being unorganized
• The online home services market however is said to be around $400 - 600 Million
• Back in 2014 when UC started, the market had over 60 competitors but by 2017 most of them had been washed away and UC did some smart acquisitions across key areas and became the dominant player.

Competitive Landscape

• The competitive landscape today includes the likes of HouseJoy, the only player standing that started along with Urban company. HouseJoy has taken the direction of renovating homes
• Then there is Quikrr which raised a significant amount of money just to build its muscle in the home services market
• The latest entrant is proptech company No-broker which has seamlessly introduced house cleaning services for people who have just moved in or vacated homes found through their platform. They are expanding their portfolio of services gradually.
• Mr.Right is the other player that primarily focuses on being a marketplace to connect users with repair service providers in their area.

Search Domination

• Urban Company dominates the online space with a top ranking in searches related to AC services, water purifiers, beauty services at home, and more. It gives its competitors zero chance to get any mindshare of users even on search.

TAM/SAM/SOM Calculation

Source 1 | Source 2 | Source 3

• Indian households are estimated to spend 25,000 annually on home services (source)
• The assumption made here is that only those households with an annual income of 10 lakh and above can afford 25k per year on home services.
• However, the Average order value of Urban Company is between 1100 - 1500. So we take 1300 as the AOV (Source)
• Urban Company takes a 20% cut of each order and passes the rest to the service professional ( a model that has proved hugely successful for the company and helped gain the trust of its partners)
• UC's Revenue Calculation: 20% of 1300 = Rs. 260
• Therefore, TAM in Revenue Terms = Rs. 3640 Crore
• SAM in Revenue Terms = Rs. 832 Crore
• SOM in Revenue Terms = Rs. 290 Crore

The Channels

The channels for Urban Company have been chosen using the channel selection framework:

☘️ Organic

Organic is a very obvious choice for Urban company since it operates in categories that are frequently searched for. People frequently search for things like how to get my AC repaired, where to find the best carpenter/plumber around my house and what’s the best salon around me. The Google keyword searches for these exact keywords rightly prove so.

Attached below are snapshots of the keyword which shows the number of searches conducted on a daily basis in India via mobile phones. Below them is a real search conducted of the same keywords and where urban company ranks in comparison to their competitors.

AC Repair

Carpenter Near Me

Salon Services

Content Loop

Urban company has built a mechanism for users to rate & review the service professional who comes to their homes. This plays a vital role in the amount of work a service professional gets and therefore is requested by them to the users to positively rate them. Thus almost every service & associated service professional on the urban company app has gotten multiple hundred reviews by users. This means each category of service has tens of thousands of reviews by real users. This forms a large content bank for backlinking for Urban company and plays a vital role in their ranking on top of every service category they offer.

On average urban company Google search results have the highest ratings and 10 times more reviews than a competitor or complementary service providers (like justdial).

This tends to increase user trust which leads to more clicks which leads to higher rankings and the cycle continues.

Prioritizing this content loop makes strategic sense since it is deeply productized and is crucial for all parties involved not just the company. Service professionals want ratings because they get better and more work, users give ratings because they are happy with the service and potential users love an abundance of ratings since it helps them make a purchase decision.

Organic Search Intent

Urban company creates organic search intent by coming up with short phrases for different services in their paid ads that are easily searchable by users on Google & YouTube. For example:

• Salon at home
• Haircut at home
• Massage at home
• Bathroom Shine Challenge
• AC Service at home
• Ek bhi galti reh gayi to painting free, and more

When these exact keywords are searched the top results are always urban company’s associated service with a relevant tagline & reassurance of the quality of service.

💸 Paid Ads

The CAC for urban company is around Rs. 400 (source) and considering 75% of their orders are repeat purchases it is safe to assume that most users will not drop off without making any purchases or just after a single purchase.

Now considering the AOV of 1300 and 20% margin = Rs.260. Urban company has to convince a user to make only 2-3 purchases overall in order to completely recover its CAC. From the user surveys done it is evident that more than 70% of users used urban clap for more than 5 times. Considering that as the average no. of purchases customers make on urban company, the average LTV of a user becomes 260 x 5 = Rs. 1300.

The CAC: LTV ratio is 1:5. Therefore paid ads is a very beneficial acquisition channel for urban company.

Best Suited Channel & Content Type

The content type that is best suited for paid ads for UC is videos. Video ads are quick and demonstrate the problem, booking a solution, and the service satisfaction of users. This helps potential users see the entire journey of making a purchase with urban company and imagine themselves in the shoes of the actors in the video.

Since this is the format of ads, the best placement for them comes in the form of YouTube. Urban company already runs extensive YouTube ad campaigns that are quick and deliver the message clearly. Urban company's offerings are primarily a mix of push & pull, but they can be largely categorized as pull products since they majorly advertise services that have prexisting demand and urban company brings a premium solution to the problem.

The ICPs that are majorly targeted through these ads are both single working professionals aged 25-30 & married couples aged 30-35. Since this user cohort is the one that spends the most amount of time on YouTube consuming content (also highlighted by the selected ICP Purvi as her primary platform for content consumption) it is the perfect platform for Urban company to reach out to its prime users.

AD Budget Allocation

(Attaching the screenshot of the content lost due to the GX technical Glitch)

CPC Assumption - Source

This Google Doc contains all calculations and data presented for this project. Refer to the same for any clarifications or deep dives into raw data.

Thank You! 🙏🏼