Game on for Nykaa?
Beauty and personal care is a fledgling category which has picked up rapidly in the Indian ecosystem in the past 5–6 years. One company which has been at the forefront and bore the fruits is the Falguni Nayar led Nykaa. With a market share of ~37% in the online beauty and personal care space, Nykaa has been calling the shots among the masses in India. With its wide assortment and plunging discounts, it has challenged the likes of Sephora by shifting Beauty and personal care shopping on the smartphones. On top of that, its retail stores have been a hit as well. While Nykaa dominated the industry from the very beginning, it has also managed to thwart off competition from the likes of Tata Cliq which came but could never conquer.
11 years after it launch, Nykaa could potentially be facing a worthy competition. The recent launch of Reliance backed Tira could be the answer to Nykaa’s dominance. With its omnichannel presence in offline stores and an app worth visiting, this could very well be the answer to the dominance or unilateral headway that Nykaa has been having. While Tira recently launched its offline store in Mumbai, its app has already received ravishing reviews. There will be some excitement with a new player backed by Reliance, but its early days. This could well be the signal of ‘Game On’ to Nykaa. Other beauty and personal applications have come in the past, but Tira has certain advantages which are difficult to ignore.
1. The disruptive Reliance backing: TIra is backed by Reliance ventures. This needs no introduction. Reliance and its backed ventures have a knack of disrupting the industry. Airtel and Vodafone are still reeling from Jio’s entry. Tira could very well be Reliance’s announcement to disrupt the omnichannel beauty and personal care industry with its huge capital backing and ability to control the markets, distribution, and technology in one go.
2. The top-notch user experience (offline and online): The initial signs of the Tira app and Tira’s store in Mumbai speaks volumes of high quality and premium products being available at our doorsteps or being a drive away. The store has gone out of its way to create an interactive user experience coupled with aspects which are visible only in the Sephoras or L’Occitanes of Europe or Southeast Asia.
3. Discounted assortment: Consumers flesh out money for premium products but double think on every purchase. The discount is a factor which drives high demand. Tira has captured this essence by providing an average discount of 15–20% compared to 10% offered in Nykaa. This may be raising red flags on profitability, but Tira has a long way to go to think about profits. With its current focus to shift consumer allegiances, this may be a game changing move.
4. High accessibility of imported assortment: While Nykaa has been the answer to most of the personal and beauty care needs, there has been an apprehension to purchase premium products online without really feeling that. On top of that, the wide assortment is still not an answer to India’s needs for a detailed skin regimen which may still be accesses via stores outside India. The wider assortment provided by Tira can make consumers double think on their loyalties towards Nykaa.
While it’s very early days to pass of a verdict, but Nykaa will be looking to flex its muscles after having an unparalleled run in the market with barely any competition. Only time will tell if Reliance magic works yet again or the Nykaa dominance is set to continue, but Tira is an answer to the Indian consumer being spoilt for choices in the beauty and personal care industry. Game On Nykaa!!!
