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NYKAA: A Comprehensive Analysis of a Leading Indian E-Commerce Cosmetic Company
- 1. Faculty, St. Aloysius College (Autonomous), Mangalore, India
- 2. Faculty, College of Management and Commerce, Srinivas University, Mangalore, India
Description
Purpose: The cosmetics industry is one of the major industries that have attracted many players due to its rapid growth. The cosmetics industry plays an important role in developing the country's economy. This study is being taken up to better understand the contribution of the beauty industry to the development of the country and to evaluate the strategies of these companies. Nykaa is one of the leading companies in the cosmetics industry. It offers various products of different brands on one platform. Its setup by Falguni Nayar in 2012. She anticipated the huge opportunity in online trading in the coming years and converted that opportunity into a big vision. Her decision was not wrong it turned into building a large-scale business. By operating multinational, it attracts customers from various regions. Initially, it started the business by offering beauty products later on diversified with fashion, skincare, luxury products. This study is conducted to evaluate the strategies used by NYKAA to be one of the top companies in E-Commerce.
Research Methodology: In this paper, an attempt is made to evaluate financial performance, Competitor’s analysis, CSR, Marketing and Inventory strategy, SWOC framework of Nykaa as a research case study.
Findings: From the study, it’s clear that Nykaa is doing very well in E-retailing and gives tough competition to rival firms. Giving a platform to small entrepreneurs to grow along with their successful journey.
Originality: Various performance analysis techniques are used to appraise the NYKAA accomplishment.
Paper type: Research Case study .
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Please note you do not have access to teaching notes, nykaa: retailing decisions in an emerging market.
Publication date: 24 July 2023
Teaching notes
Learning outcomes.
By working through the case and assignment questions, students will be able to conduct a marketing environmental analysis to aid strategic decisions; analyse the first-mover advantages of a retail firm and how these can be sustained; comprehend online retail business models and the challenges therein; understand the trade-offs of online/offline retail experiences specific to an emerging market’s beauty and personal care sector; conceptualize and formulate actionable growth strategies that balance the individual and collective requirements of brick and mortar and retail e-commerce environments.
Case overview/synopsis
The case is set in 2022, right after Nykaa – the pioneer of beauty and wellness e-commerce platforms in India makes a blockbuster stock market debut in 2021. Starting in 2012 with a disruptive online model for selling beauty and wellness products online in India, Nykaa had come a long way with expansions in physical retail and other segments such as fashion. The firm, which initially aimed to be a virtual store, is now thinking of aggressively expanding in the brick-and-mortar retail space as it opens its 85th retail outlet.
Falguni S. Nayar, founder and CEO of Nykaa, wanted to roll out 300 physical stores targeting 100 cities in India in the next couple of years. She aspired to establish Nykaa as a category leader as the “Indian Sephora” in the beauty and personal care market. Nykaa’s first-mover advantage in the online beauty and personal care marketplace worked well to establish it as a brand with positive endorsements by digital shoppers that enhanced the investment potential with potential financiers. However, the pandemic had brought every physical retailer to the online platform. Most e-commerce platforms dealing in grocery to lifestyle had added personal care products to their existing merchandise.
Additionally, several start-ups had ventured into the online marketplace. Online was a cluttered marketplace with little to no differentiation. In this bloodbath, would the first-mover advantage for Nykaa in the online space still count as a competitive advantage? Nayar was all set to expand Nykaa’s physical presence aggressively. The concern was that the beauty and personal care segment had also moved online as a function of long stay-at-home periods. In the post-pandemic times, would the customer indeed revert to brick and mortar once again? Nykaa was also into product formulations, but so was every big and small player in the space. What was the differentiated winning formula for the consumer’s heart and mind?
Complexity academic level
The case can be effectively used in foundation courses in marketing and a wide range of specialized courses on marketing management (core/foundation course), retail marketing and e-commerce/digital marketing and e-commerce for B-school learners. The complex decision points faced by an innovative e-commerce start-up firm on its road to market expansion make the case suitable for niche courses such as Marketing for Start-ups. Moreover, learners in executive MBA programs with considerable experience can benefit from the case analysis that balances a growing retail company’s long- and short-run objectives.
Supplementary materials
Teaching notes are available for educators only.
Subject code
CSS 8: Marketing.
- Omnichannel retailing
- Emerging markets
- Innovative Tech-Start-Up
- Online shopping
- Marketing strategy
Acknowledgements
Disclaimer. This case is written solely for educational purposes and is not intended to represent successful or unsuccessful managerial decision-making. The authors may have disguised names; financial and other recognizable information to protect confidentiality.
Basu, R. and Sondhi, N. (2023), "Nykaa: retailing decisions in an emerging market", , Vol. 13 No. 2. https://doi.org/10.1108/EEMCS-12-2022-0449
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NYKAA: A Comprehensive Analysis of a Leading Indian E-Commerce Cosmetic Company
Article sidebar, main article content.
Purpose: The cosmetics industry is one of the major industries that have attracted many players due to its rapid growth. The cosmetics industry plays an important role in developing the country's economy. This study is being taken up to better understand the contribution of the beauty industry to the development of the country and to evaluate the strategies of these companies. Nykaa is one of the leading companies in the cosmetics industry. It offers various products of different brands on one platform. Its setup by Falguni Nayar in 2012. She anticipated the huge opportunity in online trading in the coming years and converted that opportunity into a big vision. Her decision was not wrong it turned into building a large-scale business. By operating multinational, it attracts customers from various regions. Initially, it started the business by offering beauty products later on diversified with fashion, skincare, luxury products. This study is conducted to evaluate the strategies used by NYKAA to be one of the top companies in E-Commerce.
Research Methodology: In this paper, an attempt is made to evaluate financial performance, Competitor’s analysis, CSR, Marketing and Inventory strategy, SWOC framework of Nykaa as a research case study.
Findings: From the study, it’s clear that Nykaa is doing very well in E-retailing and gives tough competition to rival firms. Giving a platform to small entrepreneurs to grow along with their successful journey.
Originality: Various performance analysis techniques are used to appraise the NYKAA accomplishment.
Paper type: Research Case study .
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Nykaa.com: A Passion for Beauty
By: Paul A. Gompers, Anjali Raina, Rachna Chawla
The experience of being an entrepreneur was a childhood dream for Falguni Nayar. The opportunity to build Nykaa.com, a woman centered business, with a multi brand retail format in the beauty and…
- Length: 26 page(s)
- Publication Date: Feb 26, 2018
- Discipline: Entrepreneurship
- Product #: 218049-PDF-ENG
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The experience of being an entrepreneur was a childhood dream for Falguni Nayar. The opportunity to build Nykaa.com , a woman centered business, with a multi brand retail format in the beauty and wellness space , and the fact that she was doing it with her daughter Adwaita ( HBS MBA 2013) made it both exciting and meaningful. Still, she was the founder and with that came control over the most important decisions. While she sought advice from many people, Nykaa, like Adwaita, was her baby. How should she structure the organization and the team to best deliver the results she wanted?
Feb 26, 2018 (Revised: Aug 30, 2023)
Discipline:
Entrepreneurship
Industries:
Human resource services
Harvard Business School
218049-PDF-ENG
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Unveiling the Marketing Strategy of Nykaa: A Comprehensive Analysis
Introduction
In the realm of Indian e-commerce, Nykaa has emerged as a powerhouse, captivating the beauty, wellness, and fashion landscape. Founded in 2012 by Falguni Nayar, Nykaa has not only become a unicorn startup but has also diversified its offerings from an online-only model to an omnichannel giant. This case study, curated by Aditya Shastri and his student team from the IIDE's Post-Graduation Programme in Digital Marketing, delves into Nykaa's marketing strategy, pinpointing its strengths, identifying pain points, and proposing innovative solutions to enhance conversion rates.
Nykaa: A Glimpse into the Beauty Empire
Founder's vision.
Falguni Nayar, a former managing director at Kotak Mahindra Capital Company, envisioned Nykaa as a platform that goes beyond selling beauty products. In 2015, the company expanded its horizons, transforming into an omnichannel model and venturing into a diverse range of products beyond beauty.
Inventory and Valuation
Nykaa operates on an inventory-based model with warehouses strategically positioned across India. Valued at ₹85 billion (US$1.1 billion) in 2020, Nykaa achieved the significant milestone of being the first unicorn startup led by an Indian woman.
Offline Presence
In addition to its thriving online business, Nykaa boasts an offline presence with 76 brick-and-mortar stores nationwide. These include Nykaa Luxe, Nykaa On Trend, and Nykaa Beauty Kiosks, creating a seamless fusion of digital and physical retail experiences.
In-House Brands
Nykaa has strategically crafted a portfolio of in-house brands, ranging from Nykaa Naturals and Nykaa Cosmetics to Nykd by Nykaa and collaborations with renowned designers like Masaba Gupta.
Researching Nykaa's Marketing Strategy
Website analysis, user experience challenges.
The student team discovered that Nykaa's website faced challenges in user experience, with feedback suggesting it appeared overly female-centric. This raised concerns about inclusivity and potentially lowered the purchase intent among male visitors.
UI/UX Issues
The website analysis revealed a flat and non-user-friendly design, coupled with a poorly designed header. The team recognized the need for a more intuitive interface to enhance the overall user experience.
Social Media Marketing Analysis
Influencer marketing.
Nykaa strategically leverages social media platforms for brand promotion, particularly through influencer marketing. The brand collaborates with influencers to showcase products, create tutorials, and review new launches.
Gender-Targeted Content
Despite the significant male audience on social media platforms, the team observed a potential mismatch between the content and the diverse audience. Adjusting content to be more inclusive could be a key improvement.
SEO Analysis
Organic traffic.
Nykaa's blog, Beauty Book, plays a crucial role in driving organic traffic. The brand excels in SEO, ranking for a variety of keywords related to beauty, fashion, and specific product categories.
Domain Authority
With a Domain Authority (DA) of 55, Nykaa demonstrates a strong online presence. The team identified key non-branded keywords that contribute to Nykaa's high visibility, such as "dusky skin," "curly hair," and more.
GDN Analysis
Display ads.
The analysis of the Google Display Network (GDN) revealed that a small percentage of traffic (1.66%) is attributed to display ads. YouTube emerged as the leading contributor, showcasing the potential for video-based advertising.
App Analysis
User interface.
The team noticed similarities between Nykaa's app and website design, emphasizing flat-lay images. However, concerns were raised about the lack of personalization in the user interface, potentially affecting user engagement.
App Icon Consistency
Discrepancies were identified between the Android and App Store versions of the Nykaa app icon updates. Ensuring consistent updates across platforms could enhance brand cohesion.
Solutions for Nykaa's Marketing Strategy
Website strategy, personalization for first-time visitors.
To address the perception of a female-centric website, the team proposed an option for first-time visitors to choose their gender, creating a more personalized experience.
Landing Page Optimization
Suggestions included incorporating special discount codes on the landing page header to incentivize app downloads and implementing attractive pop-ups for new users with personalized offers.
Blog Ranking Strategy
The team proposed running ads for blogs to enhance visibility and drive more customers to popular products, ultimately fostering loyalty.
Checkout Page Discount Code
Creating urgency on the checkout page with time-limited discount codes aimed at preventing drop-offs and encouraging immediate purchases.
Social Media Marketing Strategy
Youtube story ads.
Recognizing the high view rate of YouTube story ads, the team recommended Nykaa capitalize on this platform by creating engaging story-focused content.
Engagement with Queries
Encouraging Nykaa to actively engage with user queries on both Nykaa's and influencer's pages, fostering a sense of community and trust.
Conversion Rate Optimization Strategy
Personalized push notifications.
Ensuring push notifications are personalized and relevant to avoid user irritation and enhance engagement.
Email Marketing Enhancements
Advocating for personalized email content, including the user's first name and specific intent, to align with urgency-inducing subject lines.
WhatsApp and SMS Marketing
Introducing WhatsApp marketing with relevant blog links and shopping links, along with user-specific SMS marketing featuring valid intent and special coupon codes.
SEO and SEM Improvements
Suggestions included refining SEO and SEM efforts to capture new users and prevent them from opting for competitor e-commerce brands.
Retargeting Strategies
Utilizing pixel codes for retargeting blog readers with creative ads emphasizing scarcity and urgency, driving conversions.
Conclusion: Nykaa's Path Forward
Nykaa, despite its dominance in the beauty and fashion space, recognizes the perpetual need for improvement in the ever-evolving digital landscape. This comprehensive analysis and the proposed strategies by the student team underscore the importance of refining digital marketing strategies to enhance conversion rates.
The Digital Marketing Landscape
In the era of rapid digitalization, large e-commerce brands like Nykaa are navigating a competitive landscape. The student team envisions a potential increase in Conversion Rate Optimization (CRO) from 0.5% to 2% by implementing their suggested strategies.
A Call for Digital Marketing Expertise
The case study echoes the significance of digital marketing and the growing demand for experts who can craft robust strategies. IIDE's Post Graduation Program in Digital Marketing stands as a testament to the evolving landscape and the need for skilled professionals.
Acknowledgments and Discussion
The insights provided by Aditya Shastri and the IIDE student team shed light on Nykaa's strengths and areas for enhancement. The case study serves as a valuable resource for marketers, entrepreneurs, and enthusiasts alike, fostering a deeper understanding of the intricate world of digital marketing.
As the digital landscape continues to evolve, the journey of Nykaa and similar e-commerce giants unfolds, presenting new challenges and opportunities. Engaging in discussions and sharing thoughts on this case study can further enrich our understanding of digital marketing strategies in the dynamic Indian market.
In conclusion, the case study on Nykaa's marketing strategy serves not only as an analysis of a thriving e-commerce giant but also as an educational tool for those navigating the complexities of the digital marketing terrain.
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Nykaa.com: A Passion for Beauty
- Format: Print
- | Language: English
- | Pages: 26
About The Author
Paul A. Gompers
Related work.
- Faculty Research
- Nykaa.com: A Passion for Beauty By: Paul Gompers, Anjali Raina and Rachna Chawla
IMAGES
VIDEO
COMMENTS
Nykaa is a leading company in the e-commerce industry. Initially, it has concentrated on cosmetics. gradually added products related to w ellness, fashion, skincare, luxury p roducts, fragrances ...
Purpose: The cosmetics industry is one of the major industries that have attracted many players due to its rapid growth. The cosmetics industry plays an important role in developing the country's economy. This study is being taken up to better understand the contribution of the beauty industry to the development of the country and to evaluate the strategies of these companies. Nykaa is one of ...
"A Study on Factors Influencing the Consumer Buying Behaviour With ...
Nykaa's sales climbed by 40% in the fiscal year 2020-21, hitting in 2,100 crores. The establishment of Nykaa's private label in 2015 has also been instrumental in the company's rapid expansion. ... LITERATURE REVIEW Several studies have been conducted to investigate how people shop online. For instance, bellman et al. (1999) looked at many ...
In August 2022, Falguni Nayar, the founder and chief executive officer of Nykaa-a Mumbai, India-based omnichannel beauty, personal care, and fashion retailer-confronted declining profitability and a stock price that had fallen 36 per cent since the company's initial public offering in late 2021. As a woman entrepreneur who had launched her venture at the age of 49, Nayar's attempt to emulate ...
end of 2020. Around 5500000 people visit the Nykaa websites from word wide in a month, per minute they sell 104 products, 72% of loyal customers repeat purchase within a month, per minute they sell 30 beauty products. Behind-the-screen-A successful entrepreneur Falguni Nayar, the founder of Nykaa graduated from IIM Ahmedabad, India.
Abstract. In 2019, Nykaa was recognized as India's undisputed beauty product sales queen. Since its inception in 2012 as a niche e-commerce website, Nykaa has evolved rapidly. By 2019, Nykaa opened its 50th retail store, with plans for another 150; it had expanded into new customer segments (salon owners and men) and forged new partnerships ...
Nykaa's recent decision to ramp up a new business-fashion faced scepticism. Sceptics questioned whether Nykaa's omnichannel model could work in India's fiercely contested fashion market in 2019.
Nykaa is one of the leading companies in the cosmetics industry. It offers various products of different brands on one platform. Its setup by Falguni Nayar in 2012. She anticipated the huge opportunity in online trading in the coming years and converted that opportunity into a big vision. Her decision was not wrong it turned into building a ...
The case is set in 2022, right after Nykaa - the pioneer of beauty and wellness e-commerce platforms in India makes a blockbuster stock market debut in 2021. Starting in 2012 with a disruptive online model for selling beauty and wellness products online in India, Nykaa had come a long way with expansions in physical retail and other segments ...
Nykaa's stakeholders can be grouped in terms of various interest levels and power structure. Prime stakeholders Nykaa has to focus on are its employees, investors, suppliers, directors, managers ...
Abstract. Nykaa (FSN E-Commerce Ventures) distributed 2,373,563,075 bonus equity units of ₹ 1 on 12 November 2022. With Nykaa's 5:1 bonus issue, questions have been raised about alleged weak governance practises at the firm that went public in November 2021. The timing of this bonus issue created concerns about the company's motives and ...
Findings: From the study, it's clear that Nykaa is doing very well in E-retailing and gives tough competition to rival firms. Giving a platform to small entrepreneurs to grow along with their successful journey. Originality: Various performance analysis techniques are used to appraise the NYKAA accomplishment. Paper type: Research Case study.
In this in-depth case study, we examine the strategic endeavour carefully organized by Nykaa, a renowned and significant participant in the world of Indian beauty and cosmetics e-commerce. This investigation's main focus is on Nykaa's coordinated efforts to improve the user experience and strengthen customer engagement levels on their advanced digital platform. This study conducts an in-depth ...
The experience of being an entrepreneur was a childhood dream for Falguni Nayar. The opportunity to build Nykaa.com, a woman centered business, with a multi brand retail format in the beauty and wellness space , and the fact that she was doing it with her daughter Adwaita ( HBS MBA 2013) made it both exciting and meaningful. Still, she was the founder and with that came control over the most ...
Ho- There is no significant impact of Animation/Theme used in an Ad of Nykaa on influence of consumers. Ha- There is a significant impact of Animation/Theme used in an Ad of Nykaa on influence of consumers. 6. Review of Literature: After studying the available literature on Digital advertising, one of the works of Getrude Mwakasege
Introduction. In the realm of Indian e-commerce, Nykaa has emerged as a powerhouse, captivating the beauty, wellness, and fashion landscape. Founded in 2012 by Falguni Nayar, Nykaa has not only become a unicorn startup but has also diversified its offerings from an online-only model to an omnichannel giant. This case study, curated by Aditya ...
The Curious Case of Nykaa's. Bonus Issue. Animesh Bhattacharjee 1. Abstract. Nykaa (FSN E-Commerce Ventures) distributed 2,373,563,075 bonus equity units of J 1 on 12 November 2022. With. Nykaa ...
About Nykaa. Nykaa is an Indian e-commerce company, founded by Falguni Nayar in 2012 and headquartered in Mumbai. Falguni Nayar, a former managing director at Kotak Mahindra Capital Company, founded Nykaa in April 2012. In 2015, the company expanded from online-only to an omnichannel model and began selling products apart from beauty.
The opportunity to build Nykaa.com, a woman-centered business, with a multi-brand retail format in the beauty and wellness space, and the fact that she was doing it with her daughter Adwaita (HBS MBA 2013) made it both exciting and meaningful. Still, she was the founder and with that came control over the most important decisions.
A brief about Nykaa. Started in 2012, Nykaa is an Indian online beauty retailer that has grown to be India's largest destination for wellness and beauty products. It was founded by Falguni Nayar ...
PDF | On Apr 26, 2019, Anjali Jain Mahaveer published Nykaa.com | Find, read and cite all the research you need on ResearchGate
Founded in 2012 by Falguni Nayar, a former investment banker, Nykaa has redefined the way Indians shop for beauty products. In this blog, we'll delve into the Nykaa story, its rise to prominence ...