Clean beauty products are made using natural ingredients, and are touted as being environment-friendly. Over the last few years, this segment has seen the entry of several new brands — Mamaearth, Plum Goodness, WOW Skin Sciences and Juicy Chemistry to name a few — most of which have already crossed the Rs 100 crore revenue mark.
According to a recent report by Avendus Capital, beauty and personal care will be a $30 billion market in India by 2025, out of which digital-first brands could command $10-15 billion. Experts foresee the organic or natural products segment constituting 5-10% of the overall category. Globally, the clean beauty market is growing rapidly, and is expected to reach over $54 billion by 2027, according to Statista.
The D2C way
Analysts credit the direct-to-consumer channel for fuelling the clean beauty movement in the country. Newer brands, too, are taking the same route. Clovia is adopting a digital-first approach, and banking on its lingerie consumers to sample and spread the word about its skincare range. Over time, Clovia plans to launch these products in over 205 retail touchpoints. “We are already selling about 1,000 bottles a day of our spot corrector cream,” says Neha Kant, its founder.
Lotus Herbals has made Lotus Botanicals available on the company’s website and other marketplaces. Mother Sparsh, which started off as a baby care brand, has launched 15 products in the organic category so far, and claims 20-25% of its sales comes from these. While the company has launched these products in about 300 retail touchpoints, the focus is still on D2C. It is also giving existing customers new product samples to drive trials.
Digital marketing, especially influencer marketing, is being employed in a big way to spread awareness. “We have roped in about 3,000-4,000 micro-influencers for the newly launched products,” says Himanshu Gandhi, co-founder and CEO, Mother Sparsh.
The clean beauty ranges from these companies are priced in the mass to mass-premium range. Manohar Kamath, CXO and chief of Myntra Fashion Brands, says its products fall in the Rs 250-350 range, and that the company is “geared to scale it up to the mass premium category in the next few months.”
Mother Sparsh’s products are available in the Rs 349-599 price range, while Clovia’s are priced between Rs 100 and Rs 2,000, with small pack sizes available at Rs 50.
While this is a growing category, most of its sales, about 80-90%, comes from the metro and tier I markets, experts say. “Consumers in tier II cities and beyond still like to use traditional beauty treatments such as haldi ubtan, and brands are yet to figure out a way to tap them,” says Ankur Pahwa, partner and national leader – e-commerce and consumer internet, EY India.
Getting past top FMCG brands, the likes of HUL, P&G and ITC, and personal care brands such as L’Oréal, could be a challenge for these brands, considering their mass positioning. Moreover, online as the primary sales channel could be limiting for these companies for scaling up, analysts say.
Relying on digital outreach alone to create a brand connect may not yield the desired impact, says Ankur Bisen, senior vice president, retail and consumer products, Technopak. “Brands from across categories are trying to grab eyeballs on digital, and it is becoming an expensive proposition,” he adds.