Nykaa – India’s Leading Beauty Retail Platform
Company Profiles: Anik Banerjee & Manisha Mishra | Feb 9, 2024 — 13 min read
Nykaa has emerged as a dominant force in India’s beauty, fashion, and wellness markets, catering to both physical and virtual customers. The rising demand for beauty products, especially among teens and young adults, coupled with rapid industry digitalization, has fueled this growth. Nykaa’s strategic entry into the women’s and men’s innerwear markets with brands like Nykd and GLOOT underscores its ambition to make a lasting impact in personal care.
Nykaa stands poised for continued success at the intersection of consumer trends and digital innovation.
Read about Nykaa’s Founders and Team, Funding and Investors, Marketing Strategy, Business Model, Revenue Model, Growth, Acquisitions, Future Plans, and more.
Nykaa – Company Highlights
| Startup Name | NYKAA |
|---|---|
| Headquarters | Mumbai, Maharashtra, India |
| Sector | Cosmetics, Beauty, Personal Care |
| Founder | Falguni Nayar |
| Founded | 2012 |
| Website | nykaa.com |
About Nykaa
Nykaa, a beauty retail company, sells a vast range of cosmetic and fashion products, including men’s innerwear, both online and offline. It offers extensive content, including product reviews, beauty how-to videos, expert articles, and an e-beauty magazine. Nykaa’s helpline helps customers choose products tailored to their needs, ensuring authenticity and reliable delivery by sourcing directly from manufacturers.
Industry Insights
According to Statista, the Beauty & Personal Care market in India is projected to generate $31.51 billion in revenue by 2024, with a compound annual growth rate (CAGR) of 3.00% from 2024 to 2028. The Personal Care segment, expected to reach $14.31 billion in 2024, highlights the sector’s dynamic growth potential.
Founder and Team
Falguni Nayar founded Nykaa in 2012. With a Bachelor of Commerce from Sydenham College and an MBA from the Indian Institute of Management Ahmedabad, Nayar has held significant positions at Kotak Securities. Her entrepreneurial spirit and market insight have positioned Nykaa as a leading player in the beauty and wellness industry. Nayar’s success has earned her recognition as India’s richest self-made woman, with her wealth growing 345% in 2022.
Startup Story
Nykaa was founded to address the gaps in India’s cosmetic market, inspired by the thriving beauty markets in countries like France and Japan. Initially starting with three employees, Nykaa quickly grew, guided by the principle of quality over quantity. The company transitioned from an online platform to an omnichannel model, offering a wide variety of products through its online platform and physical stores.
Mission and Vision
Mission: “To create a world where our consumers have access to a finely curated, authentic assortment of products and services that delight and elevate the human spirit.”
Vision: “Bring inspiration and joy to people, everywhere, every day.”
Name, Tagline, and Logo
The brand name ‘Nykaa’ derives from ‘nayaka’, meaning ‘one in the spotlight’ in Sanskrit. The parent company name is FSN E-Commerce Ventures Ltd.
Business Model
Nykaa operates on a D2C eCommerce model, purchasing products directly from manufacturers and storing them in warehouses in New Delhi, Mumbai, and Bangalore. These products are sold through its website and offline stores: Nykaa Luxe, Nykaa On Trend, and Nykaa Kiosks. This inventory-led model ensures high profit margins and product authenticity.
Revenue Model
Nykaa generates revenue through:
- Product Sales: The primary source of revenue from selling its own and partnered brands’ products.
- Banner Advertisements: These drive traffic and sales.
- Other Sources: Including discount income, commission income, and miscellaneous income.
Challenges Faced
Nykaa has encountered significant competition from established players like Ajio and Myntra. Technical difficulties in the early stages, such as website crashes, were overcome, showcasing Nykaa’s resilience. As competitors continuously evolve, Nykaa must innovate and adapt strategically.
Funding and Investors
Nykaa has raised $215.4 million in 15 funding rounds. Notable funding details include:
- Nov 22, 2022: Post-IPO Secondary – Rs 336 crore from Aditya Birla Sunlife Mutual Fund
- May 8, 2020: Series F – Rs 67 crore from Steadview Capital
- Dec 1, 2019: Secondary Market – $30 million from Steadview Capital
Investments and Acquisitions
Nykaa has invested in Earth Rhythm and acquired six companies, including Little Black Book, Nudge Wellness, Kica, Dot & Key Wellness, Pipa.Bella, and 20Dresses.
IPO
Nykaa’s IPO launched on October 28, 2021, received 82X subscriptions, raising around $32.53 billion. Nykaa shares were listed at a premium of nearly 80%, underscoring strong investor confidence.
Growth
Key growth milestones include:
- Over 1,900 brands with 120,000+ products.
- 5 million square feet of warehouse space.
- 21 million users.
- 141 stores and 40 fulfillment centers across 18 cities.
Marketing Strategy
Nykaa’s robust marketing strategy includes:
- Social Media Marketing: Leveraging multiple social media accounts to promote its brand and engage with customers.
- YouTube Marketing: Offering consumable content like beauty tips and makeup hacks, complemented by targeted ads.
- Content Marketing: Publishing blogs and video content to convert audiences into customers.
- Event Marketing: Sponsoring significant events like Femina Miss India and various college fests to reach target customers.
Advertisements and Social Media Campaigns
Nykaa’s campaigns, like “Kya Khoob Lagte Ho,” directed by Prasoon Pandey, evoke strong emotions, emphasizing authenticity and the beauty of unguarded moments.
Awards and Achievements
Nykaa has received numerous accolades, including:
- Isidoro Alvarez Lifetime Achievement Medal (2023)
- DNA Women Achievers Awards (2023)
- Asia Integrated Reporting Awards (Bronze Award, 2023)
Competitors
Nykaa’s top competitors include Purplle, Myntra, and Tata Cliq.
Future Plans
Nykaa aims to expand its multichannel reach, enhancing customer experiences both online and offline. With plans to open 180 stores across India by 2024, Nykaa is committed to growing its physical presence while continuing to innovate in the beauty and fashion industry.