India, September 17, 2024 – As the world’s fourth-largest beauty market, India’s beauty landscape is at a tipping point in its journey that can be attributed to premiumization, evolving consumer demographics, and technological advancements. Recognising this tremendous potential, India’s leading and most trusted specialised beauty retailer, today, unveiled its ‘Nykaa Beauty Trends Report’ that spotlights nine compelling trends that are transforming the beauty Industry. This comprehensive, first-of-its kind study developed in partnership with Redseer explores the key factors driving growth, uncovers emerging trends, and provides actionable insights on how brands can successfully navigate and thrive in the dynamic beauty market.
One of the most significant findings of the report points to the rise in premium beauty consumption that is driving a seismic shift in the beauty industry. This premiumisation is being driven by access to global premium beauty brands, expanding beauty baskets due to Stepification and routine building, and innovations in products across categories. Alongside this, customers’ beauty aspiration continues to grow, galvanised by their ability to spend more discretionarily, democratization of expertise, and expanding base of dual-income households.
Nykaa has been at the forefront of driving this shift towards premiumisation by democratizing access to over 3600+ beauty brands. Over the past decade, Nykaa has successfully launched and grown global prestige and luxury brands in the country. It caters to the largest base of premium beauty buyers in the country, as well as hosts the largest assortment of premium and luxury brands. The study has identified GenZ and young millennials along with customers in non-metro cities as the audiences spearheading beauty consumption and growth. Nykaa’s content and education ecosystems along with its robust campaigns have been instrumental in augmenting and shaping demand for this cohort. Along with the education of customers, omnichannel access will also be pivotal in driving growth; this has been steered through Nykaa’s footprint of over 200 retail stores and Nykaa Superstore, its highly impactful e-B2B distribution.
Anchit Nayar, Executive Director and CEO, of Nykaa Beauty said, “As India rapidly ascends to become one of the world’s most influential beauty markets, we at Nykaa are incredibly optimistic about its future. The insights from our Beauty Trends Report clearly show a market poised for extraordinary growth, driven by premiumization, technological advancements, and a new generation of discerning consumers. Nykaa remains committed to leading this transformation by democratizing access to the world’s best beauty brands, fostering innovation, and expanding our reach across both digital and physical channels. We believe that by staying true to our core values of authenticity and customer-centricity, we will not only grow with the market but also play a pivotal role in shaping the future of beauty in India.”
Anil Kumar, Founder, and CEO of Redseer Strategy Consultants, remarked, “The Indian Beauty and Personal Care market, valued at USD 21 billion, is on the brink of a transformative journey, projected to grow at a robust 10-11% CAGR over the next five years. This dynamic sector is not merely expanding; it’s rapidly evolving, with e-commerce expected to surge by 25% annually, leading the way. The democratization of beauty expertise through social media, now influencing over 500 million users, is ushering in a new era of informed and empowered consumers. Brands that embrace this evolution, leveraging omnichannel strategies and innovative offerings, will not only thrive but will shape the future of beauty in India. The coming years will be pivotal as we witness a market that doesn’t just grow—it redefines itself.”
The Nine Major Trends Shaping the Future of Beauty Consumption in India*:
Aspirations galore: Rise of premium beauty consumption: The demand for premium beauty products is surging, fuelled by the rise in high-income households and increase in discretionary spending, as consumers seek superior quality, research-driven results, and exclusive brand experiences.
Expanding beauty vocabulary and beauty baskets: ‘Stepification’ & Innovation in Beauty: Consumers are adopting sophisticated, multi-step beauty routines, expanding their beauty baskets with niche and innovative products.
Digital natives, beauty innovators: Decoding Gen Z & Young Millennials: Constituting 28-30% of India’s population, this demographic is redefining beauty by moving forward and prioritizing self-expression, proactive skincare, and embracing bold new trends.
Beauty Beyond Metros: Boom Towns, Easy Access, Growing Aspirations: Cities beyond metros are emerging as significant markets, propelled by rising incomes, growing aspirations and the physical retail presence of beauty brands.
Homegrown Brands: Changing Dynamics and Path to Growth: A vast group of homegrown beauty brands have emerged across price points and categories, also fuelled by VC funding, yet only a few brands have managed to truly stand out and scale. While these successful brands are pioneering change with innovative products and formats, others are exploring partnerships and fresh investments for growth.
Expanding ecosystem: Partners and Platforms: The industry is witnessing brands across the spectrum shifting their spending heavily towards influencer marketing and at the same time new platforms & channels are emerging for engaging with different audiences.
Beyond the label: Demystifying ingredient-focused beauty: Ingredients are becoming pivotal in consumer decision-making, as consumers increasingly seek targeted solutions for specific issues like dry skin, rashes, and other concerns. Trends like ‘skinification’ driving innovation across beauty categories.
Small shifts, seismic impact – The microtrend revolution: Rapidly shifting microtrends, often influenced by celebrities, are reshaping the beauty industry, particularly among younger consumers. Brands are now required to adopt more agile manufacturing processes to quickly produce and capitalize on these fleeting trends.
AI, Personalisation & Beyond: Intersection of beauty and technology: Technology is transforming the beauty landscape through personalization, specialized long-tail searches, seamless shopping experiences, and efficient supply chain processes, allowing brands to meet consumer needs with greater precision and speed