Thursday 28 Mar 2024
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This article first appeared in Digital Edge, The Edge Malaysia Weekly on February 15, 2021 - February 21, 2021

Before he set up local wedding solutions platform Nikahsatu in 2017, Rushdi Razif worked in a venture capital firm, which required him to meet many business owners. Over the years, he found himself doing pro-bono advisory for them. His “services” spread to other entrepreneurs through word of mouth and, one day, he met Naimran Yunus, who would co-found Nikahsatu and is its CEO.

The pair realised there was untapped potential in the wedding planning industry, especially when it came to automating and simplifying the wedding planning process. Based on his experience in private equity, however, Rushdi knew that direct-to-consumer businesses struggle with customer acquisition, which is also quite costly.

To tackle the customer acquisition con­un­drum, the company developed a “digital kad kahwin”, or digital invite, where with a click of a button, wedding guests can save the wedding date to their calendar, sign a virtual guest book and get the directions to the wedding venue, among other things.

“The digital invitation itself was a customer acquisition tool for us because it spreads out to 500 to more than 1,000 invitees across different states per wedding. And, in the invitation, there are trigger points to direct people back to Nikahsatu,” Rushdi explains.

“That’s how we monetised and generated revenue because, at the Nikahsatu website, brides can build customised deals and wedding packages in all categories, from the venue to the invitation cards and even the make-up artist. The digital invitations brought the views and website clicks.”

Headquartered in Kuantan and Kuala Lumpur, Nikahsatu (registered as Zest Ventures Sdn Bhd) is now in Selangor and Johor and will, in the next few months, expand to Penang and Ipoh.

Fast forward to 2020, and Nikahsatu has rapidly expanded its tech and services to become a holistic wedding system. The Covid-19 pandemic saw its digital invitations include RSVP functions for the various Movement Control Orders (MCOs), which allow guests to see how many slots are available to attend the wedding, as crowd control is a standard operating procedure for weddings.

It was last March, right at the time the country had its first MCO, that the company expanded its offerings by adding as many service categories as possible. Rushdi knew this was needed for the company to survive the pandemic.

Nikahsatu brands itself as a one-stop centre for brides to find everything they need for their wedding. Its website shows that brides can customise their bridal packages with services such as card printing, video–graphy and photography, live streaming, photo booth, catering, decorations, goodie bags, make-up artists and even dowry (hantaran) and daises (pelamin).

Rushdi says most of the services are done in-house, especially items related to printing. These items have high margins, which is where the bulk of Nikahsatu’s revenue comes from.

“We service 2,000 brides on average per month. So, for the other categories that are outsourced, we give them volume,” he explains.

“We started off as a digital card and moved towards planning large-scale weddings. If you look at the market, most wedding planners can do 40 to 50 events per month; we are able to do thousands of full-package weddings because of the tech we employ.”

Rushdi says the company automated many of the processes, where routine things such as customer service and event coordination can be managed using chatbots. Nikahsatu also has its own enterprise resource planning and procurement system, which helps streamline the wedding planning process.

Nikahsatu’s back-end technology does not employ complicated tech such as artificial intelligence and machine learning, but Rushdi says the company may one day require these technologies to automate its chatbots. For now, the focus is to simplify any routine processes.

“For example, for the drafting process of printed items, in terms of designs that need to be done manually, we’ve built drafters that allow customers to choose different font types and whatnot, all of which are automated. And once it’s approved, it goes straight to production and we print it,” Rushdi explains.

“It works like a procurement system; so, at every stage of that process, everyone is informed of what is required from vendors. In this way, when there is an order, each vendor will get a notification and, if they don’t respond, other notifications are pushed out. This is how we can be a wedding planner at scale.”

Making weddings financially accessible

Nikahsatu is cognisant of the financial burden of weddings. Interestingly, some of its vendors faced issues with collecting payment. Nikahsatu spoke to them, especially those dealing with bigger-ticket items, and focused some of its attention on sorting out the financing part, says Rusdi.

To make these items more ac­cessible as well as remove the pur­chasing barrier and risks, the company managed to set up a payment system that allowed couples to book their wedding packages online from RM1. Following that, the couple would be charged a monthly instalment for all the services booked, to be fully paid up before the wedding.

“This is something we worked out with the vendors, as it is something that requires booking volume to work. Fortunately, we were able to provide the volume. To mitigate the risk of people running away without paying, however, the instalments have to be fully paid before the wedding itself.

“We are looking for other solutions and working with different parties to provide instalments beyond the wedding date, but the difficulty on our part is the big-ticket items that can go up to thousands of ringgit.”

There is also a digital card option, where Nikahsatu can collect monetary wedding gifts on behalf of the couple. Rushdi says the site also has a solution similar to “Go Fund Me”, where couples can put up the list of services they have employed and friends and family can choose which category they would like to sponsor or contribute to financially.

Expanding in a pandemic

Last June, Nikahsatu raised an undisclosed amount of seed funding from early-stage venture fund and seed accelerator 500 Startups. Rushdi says the funding will allow the company to own a larger market share of the places it operates in.

“The Malaysian wedding market alone has an annual transaction value of RM7 billion. We have a viral user acquisition element embedded in our model that allows us to acquire the market organically quickly but at very low cost,” he says.

“Our focus for the next 12 to 18 months is to increase our average transaction value by providing full categories in as many cities and towns. There is a gap in tier-2 cities of quality affordable wedding solutions, which will allow us to serve these underserved markets.

“Aside from making these services available in smaller towns where good-quality services are obviously lacking, it also enables B40 (low-income) brides to have access to such options.”

In terms of returns, Rushdi says the company made about RM2.6 million in revenue in 2019 and RM927,000 in December 2020. It has invested about RM170,000 over the last three years to build its back-end systems, among other things. 

An expansion into Indonesia is also part of its five-year plan but, for the next three years, the focus will be on gaining a larger share of the local market, as much as 30% to 40%.

“Right now, transactions-wise, we own about 8% of the [RM7 billion] Malaysian market. But the end-game is to have a presence in Indonesia as well.”

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