The Beauty & Wellness space in India stands at a whooping ₹50,000 crores and is set to grow at a 15-17% rate Y-o-Y. But, aside for a few biggies, there aren’t many beauty-focused multi-brand retail format eCommerce stores in the market.
Having said that – technology is evolving, and since the consumers are getting more aware of international trends, the Indian beauty market remains to be an untapped market, which, with the entry of new players, is getting crazier and interesting at the same time.
What is Nykaa.com?
Started in April 2012 and operated by FSN eCommerce Ventures – Nykaa is a Mumbai based eCommerce premier online beauty and wellness destination that offers beauty and wellness products for men and women at best prices.
Derived from the Sanskrit word “Nayaka” that literally means “Actress” or one in the spotlight, Nykaa.com is all about celebrating the star in you…
With 35000 products from more than 400 curated, well priced and 100% genuine brands, Nykaa offers a comprehensive range of makeup, skincare, hair care, fragrances, bath and body, luxury and wellness products for both, women and men.
Additionally, one can also avail beauty services such as Spa/Salon, At Home, Skin Treatments, Makeup Artists, Diet Consultants, Gyms, Misc. Services, etc, as well.
As your beauty buddy, Nykaa also offers expert advice and guidance, through their must-read Beauty and Makeup Blog – ‘Beauty Book’, which accounts from 25 leading makeup stylists, skin, hair, personal care and wellness experts who answer any questions or concerns that one may have related to beauty, health, nutrition and personal care. This section also includes a Virtual Makeover tool to try and share different makeup looks as well.
Beyond that, Nykaa also has a section called – ‘Ask Nykaa’, which is a community of fellow members of the portal for all the questions and doubts that one may have before they purchase a product from the site.
Accolades & CSR
‘The Most Innovative Ecommerce Company’ award at the e-Tales Awards (2015)
Collaborated with Femina to host the ‘Nykaa.com Femina Beauty Awards’ (2015 and 2016)
Nykaa raised funds for Project ‘Nanhi Kali’ (an Indian NGOs for Girl child Education that provides primary education to underprivileged girl children in India) on the occasion of International Women’s Day (2015)
What is their Business and Operating Model?
Unlike bigger e-commerce players who prefer the marketplace model, Nykaa believes in storing most of their inventory; 85%, to be specific! This leads to a much more superior user experience with extra fast delivery.
Below mentioned are the steps to place the order: –
- Visit www.nykaa.com
- Click on “Account” on the top right-hand corner of the page and then “Sign Up” to register with Nykaa
- Once you have shortlisted your choice of purchase, click the “Add to bag” button to add them to your shopping bag
- Click on your shopping bag on the top-right corner to use the offered discount coupons by clicking on “Got a Coupon Code? Apply it here”.
- Next, click on the “Checkout” button and fill in the email address, shipping address, and payment details.
- Then, click on “place order” to go ahead
- Once the order is placed, you will see a confirmation page with an order number. This would also be emailed to you as well.
- After the ordered products pass through the final round of quality check and inspection, they are packed and handed over to Nykaa’s trusted delivery partners and are delivered
- The orders are dispatched within 1-4 business days (excluding Sundays and public holidays). Nykaa ships their products across the country with the help of leading and reliable courier companies.
- Some of their payment options include: Debit and Credit Cards, Net banking, Cash on Delivery, PayUmoney, Wallets, e-Gift cards, Wallets, e-Gift cards
Additionally, to maintain the reputation for product quality and reliability, Nykaa makes sure to put in all the efforts to do so, from – random sampling of products that are near expiry, surprise checks at the warehouse to make sure all quality control measures are implemented, and choosing the most reliable courier partners across the country.
Plus, to ensure that no fake products are sold, Nykaa also controls the entire value chain from product sourcing to final sale too.
For any queries, feel free to contact them on support@nykaa.com or chat with them by clicking on the “Chat with us” tab at the bottom of the screen.
What kind of partnerships do they have?
Nykaa.com sells over 350 brands and 35,000 products and ships to almost 9,000 zip codes in more than 900 cities across the country.
To achieve that, they have partnerships with some of the world’s best personal care giants including Unilever, P&G, L’Oreal, Beiersdorf, Johnson & Johnson, along with popular Indian brands like VLCC, Khadi, Parachute, Himalaya, etc, and have also partnered with India’s top distributors of international luxury and premium brands.
Nykaa.com is also the only authorized online retailer of luxury fragrances in India that offer top-of-the-line luxury fragrances from brands such as Calvin Klein, DKNY, Davidoff, Yves Saint Laurent, Giorgio Armani and L’Occitane, as well.
What strategies have they adopted?
Nykaa focuses on targeting the beauty conscious Indian woman; more specifically, their customers fall in the age groups between 18 and 34, where the Female: Male ratio is 75:25. To target this audience, Nykaa follows unique strategies!
Nykaa started with commercial marketing from April 2013!
The company has categorised their customers into three types: First – are the ones who are short on time, and eCommerce is perfect for them; Second – are the ones who are the beauty addicts, who know exactly what they are going to buy; and lastly third – are the ones who are newbies and don’t have much about makeup or beauty and don’t really know what to look for.
In a constantly evolving internet, their marketing mix sometimes almost changes daily, and primarily focus on the content.
Firstly, the company offers a lot of education through their online magazine “Beauty Book”, and also have a YouTube channel called “Nykaa TV” on which they keep uploading a number of how-to videos.
They also have videos and content on their product pages, and also showcase something called “Nykaa Decodes” where they carry articles and also have experts answering online too.
To promote this content, Nykaa makes heavy use of social media platforms for lead generation and also launches various offers to convert them into sales. With the lucrative and attracting contents and videos posted frequently, the company has used effectively the social media platforms.
Using the social media and their content, Nykaa, as a brand has managed to gain a pan-India presence amongst their targeted audience.
Other than that, they also provide various offers and discount coupons to customers and as well.
More recently, since the launch of their own Private Label and Beauty Services it has become imperative for them to extend their marketing strategy to some amount of offline activation; hence, Nykaa also has taken a bold decision and opted to try out Experiential Marketing for their promotion, as well. This will allow consumers of Nykaa engage with them more, and get more deeply involved with their journey as a brand.
As a strategy, they would be bringing in a range of creative elements to their customers at different periods of the year 2016.
Who leads the brand?
Nykaa.com is the entrepreneurial dream of Falguni Nayar and was founded in April 2012.
She is married to Sanjay Nayar (CEO – KKR India, the India wing of the American private equity firm that specializes in leveraged buyouts), and has two children – a son who works with Morgan Stanley in New York, and a daughter, who works with Falguni itself.
A mantra that she lives by is – “Retail is all about Detail” and is often heard propagating the same too. Hence, her close eye to detail, keen involvement in every aspect of the firm and passion for the business are the qualities that make her a great leader.
Falguni is an IIM-A (Master of Business Administration – Finance, General) pass out and had completed her graduation from the Sydenham College in Accounting and Business/Management, as well.
She started her career with A. F. Ferguson & Co in 1985 and went on to work with them for more than 8 years.
In 1993, Falguni joined Kotak Mahindra Bank as a Head of their Investment Banking division.
After eight years of managing their international operations in the US and the UK; Falguni then moved on to take over the role of Managing Director of their investment banking business in 2005. Over the period of 10 years, she successfully leads the firm to become India’s leading IPO bankers and was also the key person behind the closure of a number of successful M&As as well.
Finally, in 2012, she left Kotak to start her own venture – Nykaa.com!
Other than that, she was a Founding Member of the Asia Society in India, and also sits on the boards of several companies, including the Aviva Insurance Board, Dabur India, Tata Motors (as an Independent Member), as well.
Over the period of time, – she also has managed to receive many accolades throughout her career. The most notable ones include: –
- the FICCI Ladies Organization (FLO) award for the top woman achiever in the field of banking
- the Business Today award recognizing her as one of the top 25 women in business
How has been their growth so far?
Falguni founded Nikaa.com when she was looking at various business options. This one particular trend that she noticed was countries like Japan, France, and Europe had stores like Harrods, Bloomingdale’s and Saks Fifth Avenue that offered a wide range of beauty products and fragrances. But unlike them, even after having a huge demand, India did not have many such outlets.
Later, she also studied and observed Sephora – a US-based multi-brand retailer, which offered its customers an unbiased advice about multiple brands and products.
Around that time, the eCommerce sector had begun to take off in 2012 when she quit investment banking. There was a need for a multi-brand retail format in the beauty business in India, and the millennials exactly knew what they wanted and were also open to change.
So if you wanted to cater to such customers, a few brands on display would not have been enough; but instead, you’d need performance-based products!
She understood that this segment had a large market to be catered and eCommerce would be more efficient way to service all the customers with a long-tail inventory market in India.
Hence, inspired by the concept and a keen interest in the segment; Falguni along with her banker husband Sanjay Nayar, started Nykaa.com. The Nayars invested $2 Mn from their own pockets and controlled roughly 95% stake, while employees held the remaining stake.
They started off with an extensive selection of curated and branded products through an initial offering of 100+ brands and 4000+ SKUs (stock keeping units), and received their first order on 24th October 2012.
In the next two years, not only did Nykaa open their first physical store in Delhi’s T-3 Terminal (August 2014), but were also booking a staggering growth of 323%, with 1.5 million visitors and 50,000 unique visitors a month.
They had now expanded to over 350 brands and 35,000 products and were also claiming to have sold more than 1.25 million products to 178,659 customers till date.
They were now directly competing with companies like Purple, as well as large online retailers such as Amazon.
More recently, the company has also introduced their privately labeled products in the bath and body care category and have also expanded their physical outlet to Mumbai airport as well.
Talking about their funding – Nykaa.com has raised a total of $12.9M from a clutch of investors, including high-net-worth individuals (HNIs), non-resident Indians (NRIs) and family offices, along with TVS Capital, Atul Nishar, Harsh Mariwala, Dalip Pathak (who established the India business for private equity firm Warburg Pincus, LLC in 1994), Techpro Ventures Private Limited, etc…
Going ahead, Nykaa aims to open offline stores in Mumbai, Delhi, and Bangalore by the end of this year. They also intend to raise roughly ₹100 crores more, to expand their private labels and offline stores, and for marketing and setting up warehouses.
“In our last fund raise we got a post-money valuation of ₹425 crore and now we expect the pre-money valuation to get better as we start talking to our investors.
Nykaa will be expanding their brick-and-mortar presence under the Nykaa Lux brand, and are in plans to grow up to 30 stores by 2020.
