In 2023, don’t be surprised if you ask any girl which website she uses to buy makeup products and she promptly responds with “Nykaa.” This is because Nykaa is currently the only brand in India that offers a wide range of makeup brands in one convenient place, all at affordable prices. It’s the supremacy of Nykaa, but in this article, we will talk about how Nykaa makes money and its fantastic business model that serves as a money-generating machine.
About Nykaa
Nykaa is an Indian e-commerce company that sells cosmetics, wellness, and fashion products through its websites, apps, and 76 physical stores in India. It was founded in 2012 by Falguni Nayar, a former senior managing director at Kotak Mahindra Capital Company. Nykaa offers a wide range of products, both made in India and imported from around the world.
In 2015, Nykaa expanded its business model from online-only to omnichannel, which means that it now sells products through its website, apps, and physical stores. In 2020, Nykaa launched two new businesses: Nykaa Pro, a professional beauty services platform, and Nykaa Fashion, a fashion e-commerce platform. Nykaa now sells over 2,000 brands and 200,000 products through its multiple channels.
Nykaa is a successful company that has been praised for its innovative business model and its commitment to providing high-quality products and services. The company has been featured in several publications, including Forbes, The Economic Times, and The Times of India. Nykaa is a role model for women who want to start their own e-commerce businesses.
How Was Nykaa Founded?
Nykaa’s success is truly inspiring. Falguni Nayar, with her finance degree from IIM Ahmedabad, took the bold step of leaving her senior position at Kotak Mahindra Bank to start Nykaa from scratch. Her journey began with a visit to a Sephora store in another country, where she was captivated by the wide range of beauty products and the immersive experience it offered.
Motivated by this experience, Nayar saw an opportunity to bring the same level of convenience and selection to Indian women. With determination, she launched Nykaa as an online beauty retailer, revolutionizing the industry in India. Today, Nykaa stands as one of the leading beauty retailers in the country.
Nayar’s story is a testament to the power of pursuing your dreams, regardless of age. Her success proves that it’s never too late to embark on an entrepreneurial journey and overcome any obstacles that come your way. Her inspiring journey encourages others to follow their passions and achieve their own version of success.
Nykaa: The Beauty Retailer That Changed India
Indian women faced challenges in the beauty industry, with limited options and lack of convenience. In 2012, Falguni Nayar recognized this gap and launched Nykaa, an online beauty retailer that revolutionized the market for Indian women.
Nykaa quickly emerged as the leading beauty retailer in India, thanks to Nayar’s deep understanding of the local market and her innovative business model. Offering a wide selection, competitive prices, and excellent customer service, Nykaa set the bar high as one of the first online beauty retailers in the country.
Nykaa’s impact extended beyond its online presence, as it established physical stores across India. These stores allowed customers to try products and receive expert beauty consultations.
The success of Nykaa has transformed the Indian beauty industry, making products more accessible and affordable for women. It has also become a role model for aspiring entrepreneurs and an inspiration for women across the country.
Nykaa Business Model
Nykaa has a strong inventory-driven business model for the BPC (Beauty and Personal care) category. This means that Nykaa purchases products directly from manufacturers and stores them in its own warehouses. This allows Nykaa to control the quality and availability of its products, and it also allows Nykaa to offer competitive prices.
Nykaa also has a strong omnichannel marketing strategy. This means that Nykaa engages with customers through a variety of channels, including its website, mobile app, social media, and offline events. This allows Nykaa to reach a wider audience and create a strong brand presence.
Nykaa has a physical presence in 38 different cities in India. It plans to expand its physical storefronts in the future. The physical stores serve two purposes:
- They allow customers to try out products before they buy them.
- They help Nykaa to build a more resilient distribution network that will allow for potential hyperlocal delivery.
The physical stores also provide face-to-face encounters with experts and, in the case of some multinational premium brands, play a key role in personal branding.
Here are some of the key factors that have contributed to Nykaa’s success:
- A strong inventory-driven business model
- A strong omnichannel marketing strategy
- A physical presence in 38 different cities in India
- A focus on customer experience
- A commitment to quality products
Nykaa is a leading player in the Indian e-commerce market. It is a role model for other e-commerce companies, and it is an inspiration to entrepreneurs everywhere.
Omni-Channel Strategy
Nykaa has a robust omnichannel marketing strategy that encompasses various touchpoints to engage with customers. This includes email marketing, social media marketing, influencer marketing, and offline events. By leveraging these diverse touchpoints, Nykaa has successfully reached a wider audience and established a strong brand presence.
Additionally, the company has a presence in 38 different cities and aims to expand its physical storefronts. The retail stores serve two main functions:
- They offer customers the opportunity to try out products before making a purchasing decision.
- They establish a more resilient distribution network that enables potential hyperlocal delivery.
Furthermore, the physical stores facilitate face-to-face interactions with experts and, in the case of certain multinational premium brands, play a crucial role in personal branding.
Affiliate Program
Nykaa excels in promoting a wide range of brands and leveraging influencer-led content through innovative and engaging videos and text-based formats. With a team of over 1300 influencers and a substantial following of 12.6 million fans across major social media platforms, Nykaa generates and produces the majority of its content in-house through the Nykaa army.
Moreover, the Nykaa Affiliate program extensively utilizes influencers, enabling external creators to generate content on their behalf across various digital channels. The inclusion of well-known influencers enhances the platform’s credibility and reach.
Focus on Beauty and Wellness:
Nykaa’s business model revolves exclusively around the beauty and wellness industry. By narrowing its focus to this specific niche, Nykaa has positioned itself as a specialist in the field. This strategic decision has allowed the company to establish a unique brand identity and earn the trust of its customers.
Exclusive Product Range:
One of Nykaa’s key strengths lies in its diverse range of exclusive products that cannot be found on any other e-commerce platform. This exclusive product range sets Nykaa apart from its competitors and serves as a compelling selling point. It includes Nykaa Cosmetics, the company’s in-house brand, as well as other exclusive beauty and wellness products.
Tech-Enabled Operations:
Nykaa places a strong emphasis on technology, leveraging it to optimize operations and enhance the customer experience. The company has made significant investments in cutting-edge technologies such as artificial intelligence and machine learning. These technologies enable Nykaa to personalize the customer experience and provide tailored recommendations, further enhancing customer satisfaction.
A Step into the Glamour: Nykaa Fashion
Nykaa Fashion, a meticulously curated and closely monitored platform inspired by Taobao, emerged in 2018. Boasting an impressive collection of 1350 distinguished labels and a staggering range of over 1.8 million SKUs, it caters to the fashion needs of four distinct customer segments: women, men, juniors, and home merchandising. This comprehensive array encompasses clothing, accessories, jewellery, and housewares, meticulously handpicked and evaluated for their design and content.
With a customer base comprising less than 2% of the burgeoning online fashion industry, projected to be valued at a remarkable INR 439 billion, Nykaa Fashion beckons you to embark on an exhilarating journey into the world of high fashion and unparalleled selection.
Nykaa’s Exclusive Digital Realm
Nykaa, the epitome of an online-only retailer, stands proudly devoid of a physical store presence. This strategic decision empowers Nykaa to maintain minimal overhead costs and extend enticingly competitive pricing across its expansive product range. Embracing the digital realm wholeheartedly, Nykaa has forged a shopping experience that seamlessly transcends traditional boundaries, captivating the hearts of its valued customers.
Final Words
Nykaa has emerged as a prominent contender in India’s e-commerce industry, thanks to its distinctive business model that prioritizes top-notch beauty and wellness products, exceptional customer service, and innovative marketing strategies. By cultivating a robust online and offline presence, delivering personalized customer experiences, and offering a wide range of products, Nykaa has successfully set itself apart from competitors and established its leadership in the Indian beauty and wellness market.
Beyond its business achievements, Nykaa’s triumph extends to its unwavering dedication to customer satisfaction, employee engagement, and corporate social responsibility. The company’s commendable efforts to support women entrepreneurs and promote gender equality in the workplace have garnered widespread acclaim and admiration.
