New Delhi: Nykaa unveiled its ‘Nykaa Beauty Trends Report’ that spotlights nine 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 insights on how brands can successfully navigate and thrive in the dynamic beauty market.
The findings include:
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India’s beauty market is accelerating to grow at a 10-11% CAGR in the next five years
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E-commerce is poised to be the biggest driver of this growth and the fastest-growing segment, anticipated to achieve a CAGR of around 25%
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Rising aspirations and higher incomes among Indian consumers will propel the market for premium beauty, expected to reach USD 3-3.2 billion by 2028
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With 520-560 million users in 2023, the democratization of beauty expertise via social media is significantly influencing consumer choices
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."
Other key findings of the study:
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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.
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Expanding beauty vocabulary and beauty baskets: ‘Stepification’ and Innovation in Beauty: Consumers are adopting sophisticated, multi-step beauty routines, expanding their beauty baskets with niche and innovative products.
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Digital natives, beauty innovators: Decoding Gen Z and 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.
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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.
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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.
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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 and channels are emerging for engaging with different audiences.
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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.
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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.
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AI, Personalisation and 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.