Fashion and beauty retailer Nykaa hopes to actively defend its turf amid competition from Indian conglomerates and new players, as it stacks up strongly with a huge lead and advantage of brand play, customer base and business insights, founder and CEO Falguni Nayar has said. Nayar told PTI in an interview that retail is a “very big segment with space for many” and added that the omnichannel beauty and fashion retailer will stay focused with offerings that are far beyond consumers’ expectations so that they do not have a reason to move to competition.
The comments assume significance in the backdrop of stiff competition unfolding in India’s rapidly-growing beauty ecommerce space.
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Reliance Retail has launched an omni-channel beauty retail platform, Tira, raising the competitive heat in the booming beauty and personal care marketplace that has players like Nykaa, new entrant Tata Cliq Palette, Myntra and others.
Nayar said Nykaa has helped the beauty segment grow from a “small niche category” into a “much bigger category”.
“Now that the category is bigger, it is having interest from a lot of large companies and conglomerates from the country. They are all in retail… it was a natural extension for them to extend their retail presence in new areas.
“But Nykaa has a huge lead and an advantage in terms of whether it is brands, customers, business and knowledge of the business, so we will obviously… hope to defend our business,” said the top boss at Nykaa.
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Describing retail play as a very big segment, Nayar said it offers space for many. “… Retail has never been like ‘one person takes the whole market’. There are always a couple of retailers who flourish and hopefully we’ll be one of them,” she said.
Nykaa will stay focused and is committed to offer consumers far beyond their expectations.
“I always say that let’s stay focused on the consumer and let’s give them far beyond the expectations so that consumers don’t have a reason to go to competition,” she said.
Nayar started Nykaa, an online retailer of beauty products, in 2012. She took Nykaa public in November 2021, and following its blockbuster listing, she surpassed Biocon founder Kiran Mazumdar-Shaw to become the richest self-made Indian woman in 2022.
Nayar believes that recent instances of corporate governance lapses in some well-known startups will lead to greater scrutiny by investors (in the ecosystem), and asserted that governance agenda has to be set out very early in an entrepreneurial journey.
Any compromise on governance just because a company is growing or chasing size and scale cannot be justified, she emphasised.
“I think the companies also will learn their lesson that there cannot be compromises on governance… compromising on governance, because you’re growing or because you’re going after size and scale… that is not a justification for not following the rules. If the industry has rules laid out, then the companies have to follow them,” she said.
Nykaa, she added, has been very strong on governance.
On the business front, Nayar sees a lot of headroom for growth in beauty, personal care and fashion business in India and is optimistic about the future.
According to her, India is beeping on the radar of global players with strong drivers like young, aspiring population, rising income levels, and resilient infrastructure and digital networks.
“What Nykaa has seen is that most of the global beauty company CEOs have visited us in recent times… it has been amazing to see how the global CEOs and chairmen of top ten beauty companies have all been in our country wanting to do more. That is what is telling us that the world has an interest in working with India. And the future is bright,” she said.
Nayar said she is extremely “optimistic” and “confident” about the future, given the runway for growth.
“In beauty and fashion, the per capita consumption in India is so low that it has to be going up, multifold, with new gains in income that we are seeing.
“We have seen this journey in China too. India is today where China was 15-16 years ago. And it just went through a consumption boom in all categories, particularly the beauty and fashion segments. So we are very confident that it is going to be repeated in India,” she said.