Nykaa Case Study - The Beauty Within
From starting the business on family funds to becoming India’s first unicorn startup led by a woman, while also redefining e-commerce’s beauty and personal care space in India.
The story of Nykaa is not only very inspiring but also an amazing case study to understand how well planning out the finances of your business, understanding the market gap, and using advertising and marketing brilliantly will help you boost your business swiftly on the upward ladder!
After visiting a Sephora store (a brick-and-mortar store which is a one-stop destination for lots of big fashion and personal care brands under one roof where also you get to try and test the product) the idea of a venture was sparked in Falguni Nayar. She was very much engrossed in this idea that she took a semi-calculated leap of faith by leaving her 18 years old MD job at a very renowned bank with the vision of creating an online website that will provide 100 percent authentic product to everybody and educate the people of India (who had a high demand for these products but not always had a trustable outlet) about beauty, fashion and personal care.
Falguni Nayar founded Nykaa in 2012 with her family funds, these family funds were going to fuel the startup for a few more years not because she could not get funding but rather she chose to run the business with her family funds until Nykaa had some concrete metrics to rely on.
After 3 years Nykaa had raised roughly Rs 61.6 crore from TVS Capital in 2015 and after 5 years with 330 employees, at that time started to break even (which is a very big deal for e-commerce ventures) by 2017 and has become the next hottest thing in the market. Also by this time, Nykaa was owning 50,000 square feet of inventory in Delhi and Mumbai each and one in Bangalore which was 15000 sq feet. Nykaa had made it clear that in India there was a huge demand for cosmetic products which was not fulfilled due to various reasons and by filling this market gap Nykaa was growing at a very high speed.
Nykaa has an inventory-led business module. In this module of E-commerce, Nykaa would buy products from the brands, store the products in the inventory, and according to orders made by the consumers, the product will be dispatched. Along with this module Nykaa had some of its own USPs as well, these USPs may not sound like a big approach by the company but these USPs help the brand develop a loyal users base which makes up to 50 percent of their users. The additional features were; 100 percent authentic products, if a bulk order is made then all the products will be diverted at once unlike with Flipkart or Amazon. They gave out expert’s no. whom the customer can call and discuss the purchase they are about to make and which product will be best suitable for them. They most importantly provide budget-friendly products which are of good qualities. Later Nykaa themselves started a line of budget-friendly products as well as of good qualities, this line got a lot of support from the customers
Nykaa’s aim was not only to sell the products to the customers but was also to educate the customers as well. This motivation of educating the customer fits perfectly with their strategy in advertisements. Nykaa’s initial ads and even lots of ads now focus on educating the audiences
Nykaa early in the run released how important content marketing is. A good content strategy can help push your brand right to your target audiences. While marketing in the initial stage, they gave a lot of attention towards giving out great content, showcasing the global trenders. This laid the foundation for Nykaa as a brand.
Nykaa uses various social media platforms to create leads to showcase their offers and discounts to convert them into sales.
Nykaa shared products and traded posts on her Facebook page which helped the brand gain 1.4 million followers. They have included the shop now option on their Facebook page which redirects users directly to their website to purchase beauty products.
Twitter is witnessing more than 11.1K followers. The content and marketing team of the social media platform sends very interesting and profitable content to the site that helps Nykaa grow its Twitter followers.
The Nykaa YouTube channel has almost 50K subscribers.
Instagram has grown to become a product with over 133K followers.
Nykaa has built an ecosystem in YouTube where they’re providing the viewers with Infotainment ( Where information is served in form of entertainment ) about personal care, types of beauty products that are suitable for people, those are some of the themes that Nykaa YouTube channel follows
You know a brand has arrived when it gives out TVCs. TVCs mean a lot for brand building, and with Nykaa the first TVC was directed by acclaimed director and actor Konkana Sen Sharma which put Nykaaa right on the map. Later they got their fresh face brand ambassador in Janhvi Kapoor.
With celebrities like Katrina Kaif and Alia Bhatt becoming prominent shareholders and Nykaa’s IPO reaching a price range of ₹1,085-1,125 per share. It is fair to say that for…
Nykaa sky is just the beginning