In past few years, More than 800 new-age brands from India gone Direct-to-Consumer, by eliminating the middlemen.
New-age brands such as Mamaearth, Sugar cosmetics, Licious etc. are challenging brands like Himalaya, Unilever, ITC etc.
We've curated a list of these new-age D2C startups that had the greatest market impact in this space.
Here are the top D2C brands we're going to cover in this post:
- Wow Skin Science
- Mama Earth
- SUGAR Cosmetics
- Go Noise
- Country Delight
- Sleepy Owl
- Pepper Fry
So, Without further ado, Let's dive in!
Beauty and Personal care 💄
India's beauty and personal care market expected to be $28 billion by 2025, growing at an 8.1% CAGR, as stated by Avendus.
Three primary reasons responsible for this exponential growth are:
- Rising disposable income
- Demand for improved products,
- And increasing desire to look good.
MyGlamm offers over 600 cruelty-free and vegan products in makeup, skincare, and personal care.
The company generates 99 per cent of its sales through its own platforms, unlike other brands relying on e-commerce platforms.
MyGlamm also operates its own training academies besides its beauty services.
Its training academy offers courses in beauty, hair, and makeup, generating extra revenue.
This training course costs between 5,000 and 1.2 lakh rupees for periods ranging from two days to six months.
To sell beauty products at scale, My Glamm acquired POPxo, a digital community for millennial women in 2020.
This helped both companies to co-create, launch and market beauty products via 45,000+ influencers PoPxo had.
During the pandemic, My Glamm increased its offline presence from 500 to 10,000 POS in Tier-2,3 markets.
By increasing the size of its distribution team, the venture able to reach chemists and other mom-and-pop stores in this market.
The company appears to be in a strong position, with a claim of Rs 140 crore in annualized revenue and 400 per cent growth in the previous year.
By the end of this year, the beauty products start-up intends to increase its point of sale from 10,000 to 35,000. It is also expanding its product portfolio by entering the hair care market.
Wow Skin Science
Arvind and Ashwin Sokke; Manish and Karan Chowdhary are two pairs of brothers who made their dreams come true through this company.
To date, WOW, is a hit in both the Indian and international markets. The company has grown to be a $50 million (Rs 350 crore) enterprise, and its brand,
It sells over 200 personal care and wellness products through its own website, app and platforms like Amazon, Flipkart, and Nykaa.
Their products are also available in 5,000 stores and pharmacies throughout India.
One of their best selling drugs in Indian and the United States is Wow's Apple cider vinegar shampoo.
Data analytics revealed that customers were using Apple cider on hair and skin.
As a result, one of the company's most popular products, apple cider vinegar shampoo, was born.
Wow sold this 200ml product for Rs 399, whereas other competitors charged up to Rs 1299 for the same product. Thus, pricing was an important factor in the products' success.
The company Marketing strategy involves people's interests by educating them about their innovative products via videos.
Online advertisements were shown to users once they visit their website or Video.
The company onboarded Bollywood actresses Disha Patani and Bhumi Pednek as brand ambassadors. The goal was to increase brand awareness and reach an untapped audience.
With revenue increasing 18 times in the last four years to Rs 340 crore, the brand has experienced phenomenal growth.
Mamaearth is attempting to solve a common Indian parenting problem through innovative products.
In a country where the majority of baby products on the market contain harmful chemicals causing toxicity in a baby's body,
Mamaearth provides safe, cruelty-free, and organic products that meet international standards.
The company started with only 6 products and has since expanded to over 100 SKUs. They introduced 12 new products with ingredients Vitamin C & Bhring Amla during lockdown.
The company used to sell baby products but now it's grown to become a household name in the personal care industry.
Mamaearth products are being sold in 40 towns and over 2000 stores across India.
Their products are also available on eCommerce platforms such as Flipkart, Nykaa, Amazon etc.
Around 90% of the sale of Mamaearth comes from these e-commerce platforms.
Mamaearth collaborates with Mom bloggers on social media platforms and pitches their audiences. Influencers have devoted followers who take their advice seriously.
After famous actress, Shilpa Shetty became an investor and brand ambassador,
She's involved in the development of new products and marketing campaigns.
The brand has managed to sixfold its revenue to Rs 112 Cr in the fiscal year 2020 from Rs 17.9 Cr FY19, But despite a strong performance in FY20, their expenses grew at almost the same rate to Rs 117.9 Cr from Rs 21.6 Cr.
The company is expanding its offline presence and building efficient supply chains.
SUGAR Cosmetics is one of the fastest-growing makeup and beauty startups in India.
The brand launched in 2015 with products aimed at young Indian women aged 18 to 25.
The brand products last long in all weather conditions and are compatible with Indian skin tones.
Its products are available at Shoppers Stop, Lifestyle, Central, Health & Glow, and NewU.
With 2,500 + retail locations in more than 130 cities, It builds a massive distribution network.
The company established its presence in Russia and in the United States
And they plan to expand their retail presence in other countries, apart from India.
The brand began by launching a line of matte crayon lipsticks and matte liquid eyeliner.
Then expanding its product line by adding high pigment, long-lasting and matte finish lipsticks and kajal.
The brand carved a niche in the Rs 600-700 Rs price segment,
With their lips category accounting for over 65% of sales, while the rest by their face and eye categories.
SUGAR focuses on performance marketing, influencer collaborations, and content-driven marketing to attract customers.
Other activities include print/radio advertisements, collaborations with like-minded brands and event participation.
The brand has generated an income of Rs 100 crore in FY2020,with over 650K Instagram followers and 2 million monthly visits to its website.
Consumer Electronics 🎧
The growth of the Indian electronics industry has been rapid for the past 10 years.
In 2016, the electronics industry contributed 16.51% of India's GDP. According to Inc 42 data, the Indian appliance and consumer electronics market to grow to $ 30.6 Bn by 2025.
Rising disposable income, easy access to credit and work from home culture will be responsible for this growth.
Listening to good music is the best way to treat yourself, and if you're listening on a boAt device, it's the icing on the cake.
This lifestyle brand provided us with affordable, stylish, and high-quality consumer electronics products.
Founded in 2016 by Aman Gupta and Sameer Mehta,
BoAt positioned it as a lifestyle brand that deals in fashionable consumer electronics.
The aim was to bring affordable, durable, and fashionable audio products and accessories to millennials.
BoAt sells its products through e-commerce platforms such as Amazon and Flipkart.
To reach offline consumers, BoAt partnered with offline retailing stores such as Croma.
At the moment, its offline business accounts for 20% of its sales (worth Rs 100 crore).
Boat onboarded ambassadors from two of India's most popular industries: Bollywood and Cricket,
Among the ambassadors are Jacqueline Fernandes, KL Rahul, and Hardik Pandya.
The company raising brand awareness in smaller cities by appointing these celebrities influencers.
Today, they have around 5,000 retail locations supported by 20 distributors.
It sells 10,000 units per day, 4 million units per year and served more than 20 million Indians to date.
In 2019, boAt audio was the leading brand in the ear-wear category, accounting for 27.3% of the market. There are two major reasons behind their success:
- All millennial buyers who buy any boAt accessory are referred to as ‘boAtheads'. Hence, the company is maintaining a happy community of its customers.
- They are portraying themselves as a brand that sells lifestyle accessories. Bringing style and affordability together has worked wonders for the brand.
Talking about financials, Its revenue in FY 2020 was Rs 500 crore, up 108.8 % from Rs 239.44 crore in FY 2019, and the best part: the company has been profitable for five years in a row.
GoNoise began by selling smartphone cases after the founder sae the smartphone revolution.
The duo partnered with Chinese manufacturers to create the smartphone covers, which they sold in India.
Noise has expanded to smart wearables and wireless headphones as well.
They were one of the first brands in India to offer wireless earbuds called NOISE SHOTS.
The success reflected in increased revenue from Rs 72 Crore in the fiscal year ended March 2018 to Rs 430 crore in the fiscal year 2020.
The startup roped in cricketer Rohit Sharma as an ambassador and launched NoiseFit Fusion, a full-touch hybrid smartwatch.
The strategy is to create a popular homegrown consumer technology brand that sells outside India.
Noise targets urban millennials between the ages of 18 and 35 as early adopters of technology.
The brand is expanding into Tier II and Tier III markets through small scale shops and stores.
Their offline retail strategy has received a positive response. In seven months since offline launch, the segment has contributed 10% of the total sales.
The company is looking to partner with large retail stores with aims to reach Rs 500 crore in annual net sales by 2022.
Food & Beverage segment 🍗☕
According to Nestle India Chairman and Managing Director Suresh Narayanan,
The Indian packaged food market estimated to grow to USD 70 billion in the next 5-10 years,. Driven by factors such as economic growth, demographic dividend, and growing e-commerce.
Whereas, Revenue in the Indian Food and Beverage industry estimated to grow at a 14.2 % rate, resulting in a market size of $ 1 Tn by 2025.
Licious is a meat and seafood brand offering the cleanest fish, chicken, beef, and eggs.
95% of India's fresh meat and seafood industry is unorganized, Unsanitary local markets, filth, stench, and an unpleasant buying experience. The pair wished to alter the way Indians perceive meat.
Licious operates on a farm-to-fork model, controlling supply chain with world-class processing facilities,
Ensuring that highest quality and fresh until it reaches the end customer.
With over 3500 employees, the company claims to deliver orders within 90-120 minutes. And it handles over a million orders per month.
To date, Licious got a customer base of 1 Million + unique customers with an average basket size is of Rs 700.
Some of their marketing initiatives include BTL activation, tasting sessions at parities, surrounding housing complexes, backed with strong word of mouth accounting for 70-75 % of new client acquisition.
Licious reported steady growth in the fiscal year 2020 by cutting its losses by 66% to Rs 146.3 Cr. Whereas, the company's revenue FY20 increased to Rs 138 Cr, while expenses increased to Rs 283.8 Cr.
The concept of getting fresh milk is ingrained in our Indian culture, Yet it has the quality of milk delivered to homes is far below what we expect.
Thanks to Country Delight, Which promises fresh and unadulterated milk at the doorstep of the consumer.
You may wonder how it's possible?
Country Delight engages with the farmer, paying a premium for their milk.
It follows ethical procurement practices by investing in cold chain and quality testing infrastructure at the farmer's location.
This system improves the farmer's working capital cycle by paying them earlier than others competitors.
The company partners with low-income entrepreneurs who work part-time for delivery fulfilment.
Consumers can set their daily/alternate day milk subscription plans on the mobile app as per their requirements.
So far, Country Delight's milk sourced from 500 farmers within a 150-200-kilometre radius.
It claims to serve 1.5 million + customers and fulfil around 3 million orders per month.
Founded in March 2011 by 2 IITians, Prashant Tandon and Sameer Maheshwari,
Healthkart offers fitness products and services to help consumers achieve their fitness goals.
Before healthkart, the duo tried their hands in different sub-sectors within healthcare.
From public healthcare to selling clinics SaaS software, both of them tried two to three different business models.
After trials and errors, the two also realized that they wanted to be in the consumer healthcare space.
Healthkart stock items in-store display & allow customers to place orders online.
Third-party vendors such as Blue Dart, Shadowfax, DTDC, FedEx etc help the brand with logistics.
The platform primary acquisition tool is its 110 offline stores across 40 cities.
Trained nutrition experts available in these stores assist customers Choose the right products.
[Wondering how Healthkart used referral marketing to increase their sale by 40%?]
Healthkart sells 10,000+ fitness, personal care and health products across various categories.
The venture's annual revenue rose to Rs 369.3 crore in the financial year ended March 2020, from Rs 209.1 crore.
The company planning to expand its store network,
and also leveraging data with AI technologies to provide superior help to customers.
Sleepy Owl is a cold-brew coffee brand catering to the rise in demand for brewed & gourmet coffee in India.
You may ask what exactly is cold brew coffee?
Its ground coffee beans steeped in room temperature water rather than exposed to heat as in a traditional brewing process.
It takes at least 12 hours for the taste and flavour to filter, after which it's brewed for another 30 minutes in cold water. The brand source their coffee beans from Chikmagalur, Karnataka.
Sleepy owl first product in the market was a 1.5 litre and a 600ml super smooth black coffee box. The product is being sold at various trade outlets and online channels at a price point of Rs 300-600.
They did their first trial launch at the Sports Fest at Jindal Global Law School Sports Fest in March 2016.
Founders stick to this strategy of putting up stalls at events, college fests, bazaar’s to generate visibility for their products.
The company claims to have about 60,000 customers, fulfilling 8000 orders/month. The products sold in over 1,000 retail outlets in Delhi and Mumbai, accounting for 40% of their business. The rest come from online platforms, such as the company's website and Amazon.
Home Decor 💺
According to a report published on researchandmarkets.com,
the global market for online home decor estimated to be $98.4 billion in 2020 amid COVID-19.
The primary drivers of this growth are:
- The home has emerged as a place to live, work, unwind, work out, educate the children and everything between
- Due to the pandemic, The money spent on vacations has now spent on home-related spending.
Wakefit offers mattresses & other sleep-related products such as pillows and comforters.
This Bengaluru-based startups imports raw materials from Europe and the Middle East & manufactures in India.
Wakefit delivered 4.5 lakh units to over 30,000 pin codes across the country.
Founders did used video interviews of their first 100 customers during early stages.
These early feedbacks helped them with improving their product longevity, packaging and thickness.
Their flagship products, Orthopedic Memory Foam & Dual Comfort Mattress starts at Rs 8000 & 6000.
Wakefit ships 250-300 mattresses per day, for a total of 7,500-9,000 mattresses per month. So far, they served a customer base of over 4 lakh people and received over 12,000 positive online reviews as well.
The company delivers PAN India, including small towns and difficult terrains such as Jammu and Kashmir.
For delivery, it has partnered with BlueDart, FedEx, and local companies such as City Xfer.
Word-of-mouth has been the most effective tool in helping Wakefit grow. Also, the company does content marketing on the importance of sound sleep and health.
Their Average ticket size is Rs 11,000 with customer acquisition cost varying from Rs 800-900.
The brand also gone viral for its Sleep Internship initiative in 2020.
The Sleep Internship was an exciting opportunity where individuals rewarded with Rs 1 Lakh for 9 hours of sleep for 100 nights.
The company drived the message home of the importance of sleep and how it can be both satisfying and rewarding when done right.
The first season of sleep internship in 2020, received 1.70 lakh applications from around the world.
Their revenue surges 2.5X to Rs 197 Cr in FY20 from Rs 79.63 Cr in Fy19; Churning profit of Rs 10 Cr.
Bedsheets, pillowcases rebranded by WakeFit accounted Rs 7.7 crore of total revenue.
Whereas, the Sale of scrap goods contributed an extra Rs 2.6 crore to revenue from operations. The company is targeting revenue of Rs 1,000 crore by FY23.
Pepperfry is India's largest and popular online furniture store.
They deals in furniture, lamps, kitchen appliances, housekeeping, bath and dining equipment.
Pepperfry has over 3.5 million registered users and 5 million monthly visitors to date.
The platform operates on a managed marketplace business model,Where small and medium-sized business merchants sell their wares through the platform.
They collaborates with the sellers and after verification, they get specific items from the sellers.
The company owns 500+ vehicles used for order fulfilment. With over 20 Studio locations across the country, Pepperfry provides the best customer service and products.
Their simple products & advanced delivery mechanism helped them to hold a market-leader position.
Peeperfry solid wood furniture category accounts for approximately 80-85 % of the company's business.
According to Times Now, the platform has three warehouses and 21 distribution centres. Repeat customers account for approximately 58 % of its transactions.
To promote its products, the brand uses digital marketing, print media, and television.
They collaborated with Satchi and Satchi on its first television commercial, "Happy Furniture to You," to promote the brand.
This advertisement broadcasted on radio, Google, YouTube, and Facebook as well.
Their Is Diwali Kuch badalke dekho campaign became well-known for instilling love and peace during the festivals.
As stated by Inc42, The company managed to increase its revenue by 26% YoY to INR 260.61 Cr FY20. Moreover, expenses fell by 1.79% to INR 383 Cr.
Pepperfry's makes money by commissions from suppliers and products sold via e-commerce sites.
Among all the segments in D2C, fashion has the second-highest growth potential to reach $43.2 Bn by 2025. Whereas, e-commerce to grow $ 188 Bn by 2025.
Increase in disposable income, internet penetration and online transactions are reasons for growth.
Because of Work from home and fitness culture, Comfort wear category athleisure seeing a significant growth.
Social media and other online channels emerging as dominant influencers in this market.
Lenskart transformed India's unorganized eyewear industry.
Launched as an online portal for contact lenses, the company expanded its product line to prescription and sunglasses as well.
Lenskart offers more than 5,000 styles of frames and 45 types of quality lenses to its customers.
The designs are in line with the latest trends, thanks to team of designers and stylists staying up to date on latest trends.
The company operates on an inventory-led model, passing these designs to its manufacturers.
Lenskart's supply chain, assists them in keeping product costs under control.
Because there is no middleman involved, the company can pass on the benefit of lower costs to customers in the form of nearly 70% lower prices.
The brand gained traction by offering free eye check-ups and trials of frames at home itself.
They used to send employees to connect with consumers who were either hesitant to meet doctors or were lazy to go for an eye check-up.
As a result, one out of every two visits converted to a sale for the company.
To scale things up, Lenskart partnered with non-optical people in tier 2 and tier 3 cities: To offer free check-ups. This extended to visiting companies and giving free-check up to their employees.
Lenskart also offered its customer an online 3D trial facility before purchasing frames. This helped consumers to send their trial images to friends and family for feedback.
As of now, the venture has about 600 stores in over 66 cities including Agartala. Raipur, Haridwar etc.
The platform introduced appointment-based shopping and aggressive sanitization procedures due to pandemic restrictions.
According to Inc42, Lenskart's reported revenue of Rs 967 Cr in FY2020, with a profit of Rs 18 Cr. Around Rs 9.3 Cr came from the international market while the company earned Rs 884 Cr from the Indian market.
In India, jewellery is considered a purchase for weddings and other special occasions. Once the wedding is over, these lovely items spend the majority of their time in lockers.
But, Modern young woman wishes for contemporary jewellery that can be worn daily from office outings to daily workwear. Unfortunately, several old brands only make traditional jewellery for special occasions.
That's when Saroja Yeramilli decided to fill this gap by starting a lightweight jewellery startup, Melorra.
Bengaluru-based Melorra offers everyday wear jewellery and offers a wide range of options under Rs 50,000.
The company claims to be India's largest distributor of jewellery, having delivered 1,700 towns in three years.
Every piece of jewellery they sell is custom-made after an order is placed.
This leads to a huge reduction in carbon footprint and being sustainable, plus saves them a lot of money.
With 75% of the brand's consumers under the age of 35 and 30% under the age of 25, younger women of this generation are bound to be interested in gold Jewellery.
The team hire from colleges as they realized that experienced jewellery designers wouldn’t work well for their brand.
That’s something they have continued to do and with successful results.
On the manufacturing side, The company uses 3D printing facilities only. For gold jewellery, the company uses casting, which makes it lightweight and affordable.
The startup sends fashion experts to the cover of Paris and Milan Fashion weeks for keeping an eye on global trends.
The startup claims to have clocked a revenue run rate of Rs 160 crore in 3.5 years and a 400% Y-o-Y growth in FY 2019. The target is to meet breakeven by the fiscal year 2023.
The Indian footwear market is worth Rs. 73,000 crores ($10 billion+) and is growing at a rate of 15% per year. The premium casual footwear segment (prices ranging from Rs. 2000 to Rs. 6000) is estimated to be worth Rs. 8,000 crore ($1.2 billion).
Flatheads offers stylish and comfortable footwear for both work and fun environments.
Founders Utkarsh Biradar and Ganesh Balakrishnan observed a gap in the market price ranging from Rs 2,000 to Rs 4,000
And wanted to offer people everyday wear everyday shoes matching their personality & affordable.
The team took four months for consumer research to understand the use case for the shoes they plan to build. For learning how shoes are made, they visited Chinese factories, trade shows and met with suppliers as well.
The founders received their first 100-150 orders from their family and friends.
Additionally, they launched a pre-order email campaign with a simple sign-up form to collect email addresses. And shared on Linkedin and Facebook boosting the posts to create a sense of intrigue.
As a result, they received 3500 email signups, of which 200 ordered.
Major of their manufacturing is been sourced to china but with time, the company has started manufacturing small volumes in India as well.
So far, Flathead had sold around 5200 pairs of shoes with 15-20% of their customer buy again from them in 2-3 months. The company is growing at 20-25% M-o-M and clocking monthly recurring revenue of around Rs 30-40 Lakh.
Emerging Trends in D2C
Markets and consumer behaviour have changed in a short period of time after the pandemic.
Yet, Pandemic accelerated online adoption despite the temporary closure of physical retail store.
In this context, online spending in India estimated to increase at a CAGR of more than 35% over the next five years.
Here are a few emerging trends we may expect to flourish going ahead:
- D2C brands will be able to reach Tier 2-3 cities due to increasing internet penetration.
- D2C brands have extensive access to their customers' insights, demographics, and purchasing patterns. This assists them in curating their marketing and product strategies with customers needs.
- Consumers will prefer doorstep delivery within 24-72 hours of ordering and need variety of products to choose from.
- Brands will began allocating their majority budget to digital ads. This may increase the customer acquisition cost for that industry.
- Flexible payments options such as no-cost EMI, Buy now pay later will enable people with a lower income to avail e-commerce purchases.
Above all, technology and innovation will be critical to success in this space.