In 2013, when Nykaa made its debut, the Indian beauty market was in its infancy. Offline retail options were limited to a handful of brands, while e-commerce was only beginning to explore its potential. Today, Nykaa stands at the forefront of this transformation, having reshaped the beauty and wellness industry with its omnichannel approach, offering greater accessibility to consumers across diverse demographics.

Pioneering Omnichannel Retailing
Nykaa’s journey began with its e-commerce platform, launched in 2012, followed by its first retail store in 2014. This was a strategic move to bridge the gap between online and offline shopping experiences, anticipating the needs of customers who desired the tactile experience of in-store shopping, as well as the convenience of online replenishment. Anchit Nayar, the Executive Director and CEO of Nykaa, emphasized that the company has always focused on enhancing customer experience across multiple touchpoints—physical stores, e-commerce websites, mobile apps, and social media.

Today, Nykaa operates 228 stores across India, more than any other beauty platform in the country. Despite this expansive physical presence, the online segment remains the backbone of its success, contributing 90% to the company’s total sales.

Expanding the Beauty Ecosystem
India’s beauty market, while still one of the lowest globally in terms of consumption, presents enormous untapped potential. International beauty brands previously faced challenges entering the Indian market due to the lack of local partners and retail infrastructure. Nykaa, however, developed an ecosystem that not only facilitated their entry but also helped expand the beauty category. As Nayar put it, “The entire market is a gap,” and Nykaa sees tremendous growth opportunities in the coming years.

The launch of Nykaa’s latest ‘Luxe’ store in Mumbai, located at the Phoenix Palladium in Lower Parel, is a testament to this commitment. The 3,000 sq ft store features a curated selection of renowned international beauty brands such as Yves Saint Laurent, Tom Ford, Estee Lauder, Charlotte Tilbury, and Huda Beauty. This is one of many steps Nykaa has taken to bring luxury beauty brands to Indian consumers.

Competing in a Dynamic Market
Nykaa’s dominance in India’s online beauty and personal care market is undisputed, with a 38% share, far ahead of rivals like Amazon and Flipkart. The opening of the Palladium store places Nykaa alongside other prominent beauty retailers such as Tira and Sephora, reflecting the growing competitive landscape in the Indian beauty market.

Despite facing skepticism and fierce competition from e-commerce giants like Amazon, Flipkart, and Snapdeal at its inception, Nykaa has proven its critics wrong. Nayar reflects on the early days: “We have shown that everyone was mistaken.” Even with the entry of new competitors like Tata and Reliance, Nykaa remains unshaken, confident that there is plenty of room for growth in India’s underdeveloped beauty market.

Future Expansion Plans
Nykaa has ambitious plans for the future, with the goal of almost doubling its physical retail presence in the next three years. The company plans to add 220 to 250 more stores to its existing portfolio, ensuring continued accessibility for customers across the country. Following that, Nykaa will assess the market’s growth to determine whether further expansion is necessary.

In addition to its physical store expansion, Nykaa is experimenting with quick commerce through its ‘Nykaa Now’ program, which has already shown promising results in Mumbai, Delhi, and Bangalore. This initiative allows for faster deliveries and caters to the growing demand for instant gratification in the beauty industry. Nayar hinted that further announcements on this front will be made soon.

Looking Ahead
Nykaa’s journey from a small e-commerce platform to the leading beauty retailer in India is a story of resilience, innovation, and strategic vision. As the beauty category in India continues to grow, Nykaa remains poised to lead the way, with its omnichannel model and plans for expansion ensuring that it stays ahead of the curve.

With an eye on further innovation and an unrelenting focus on customer satisfaction, Nykaa’s future in India’s beauty and wellness market looks brighter than ever.

Author: Sonali kamble