Strong demand from across metros and tier I and II cities has helped Mamaearth crossed an annualised revenue run rate of Rs 500 crore and the brand is now looking at doubling that in the near future.
Mamaearth is now a Rs 500 crore-run rate brand.
Honasa Consumer Pvt Ltd (HCPL), which runs personal care brand Mamaearth is looking at expanding its headcount by 200 people across various roles this year as it sees significant growth momentum in its business from both online and offline channels, a top company executive said.
Strong demand from across metros and tier I and II cities has helped Mamaearth crossed an annualised revenue run rate of Rs 500 crore and the brand is now looking at doubling that in the near future. “So we right now, we are about 300 people and by the end of this year, we’ll be at about 500 people. Of these, 100 people will be a part of the offline retail team and the others will be spread over other functions – growth team, D2C team, customer service, marketing team and others,” Honasa Consumer co-founder and CEO Varun Alagh told PTI.
He added that Mamaearth is now a Rs 500 crore-run rate brand, making it one of the fastest growing personal care brand to reach the milestone in less than four years of existence. “Our next ambitious milestone would be Rs 1,000 crore but let us see when we are able to hit that. The growth last year was 400 per cent-plus…Rs 1,000 crore is our next milestone,” he said. Revenue run rate is a term used in online retailing to indicate the total value of merchandise sold through the marketplace over a certain period of time.
HCPL – which also owns The Derma Co brand – is backed by investors including Sequoia Capital India, Fireside Ventures, Stellaris Venture Partners and Sharrp Ventures. Talking about the road ahead, Alagh said there are three things that the company will focus on – expanding offline presence, continuing to bring in innovative products, and leveraging the experience from Mamaearth to launch more brands to cater to various customer needs.
“We realise that a lot of consumers still prefer transacting in the offline space apart from our D2C and e-commerce channels, we are going to focus on extending presence in offline and be present in at least top 100 smart cities of India. innovation is a core part of our brand DNA and that will continue to happen, we’ll get into new categories and product lines that consumers really need,” he said.
Alagh explained that the company has developed certain “playbooks” around its experience in marketing and distribution since the launch of Mamaearth, and it will look at replicating that and work with a “house of brands” strategy over the next few years.
He noted that the company has recently launched The Derma Co brand that will focus on science-based products, while Mamaearth’s range of products focus more on natural ingredients. Asked about the company’s international plans, Alagh said while the company’s products are available in the UAE, Nepal and Bangladesh, the focus in the medium term is on scaling the India business with multiple brands servicing millennials.
“From an international perspective, I think in the next three years, we would want to first build scalable businesses, funnels, learnings around these few markets and once we have done that is when we would go aggressive to some of the larger markets out there…then from three years and beyond perspective is where we see it (international business) to be becoming a large contributor to growth,” he added.
Alagh said within India, the company saw the contribution of tier II and beyond cities increasing significantly last year. “We’re a data-based organisation. Our D2C platform already services about 11,000 pin codes across India and there are about 3,000-4,000 pin codes which have really high contribution to the business. So we will actually be first focusing on distribution in those specific pin codes,” he said.
Alagh added that the company aims to add 40,000-plus retail points to its network by the end of this year from about 10,000 right now. Offline sales account for about 20 per cent to the revenue and this is expected to scale up to 35 per cent by the end of the year.