According to research released by Redseer Strategy Consultants and Peak XV, the personal care and cosmetics industry in India is anticipated to reach $30 billion by 2027, or around 5% of the worldwide market.
India’s beauty sector is still underdeveloped; on a per capita basis, the country spends $14 on cosmetics and personal care, compared to $313 in the US and $38 in China.
Online shopping is predicted to grow to be a “significant channel” for the personal care and cosmetics sector, according to the research. According to Redseer, the online market for personal care and beauty products will reach $10 billion by 2027, accounting for 33% of the whole industry.
“Globally, there’s a growing need among consumers for products ‘made for them’, tailored to individual skin or body types. They are increasingly willing to pay premiums for effective and safe solutions, leading to rapid growth in the masstige and premium categories. While consumers use the internet to research products, they are willing to shop across both online and offline channels,” said Rohan Agarwal, Partner, Redseer Strategy Consultants.
Pure-play brands for beauty and personal care have disrupted the industry by focusing on niche use cases. As a result, they have had greater growth rates, gross margins, and profitability than FMCG-led BPC businesses, according to the research. In reality, during the past few years, a number of new businesses have disrupted the beauty and personal care sector, offering fierce competition to existing names. New customers are being attracted to brands like Sugar, Mamaearth, and Kay Beauty, among others.
On the other hand, consumers now have better access to these companies because of the diversity of possibilities provided by e-commerce platforms.
“Indian beauty and personal care market is growing at a rate twice as fast as FMCG-led brands, signaling the significance of specialized, beauty and personal care-focused players,” according to the report. As the Indian beauty market matures, the report anticipates the emergence of multiple hundred-million-dollar pure-play beauty and personal care brands.
These companies have created portfolios based on certain skincare regimens, which has prompted competitors to introduce goods.
“From acne management to anti-aging solutions, specialized use cases are where we’re seeing a lot of the action. Brands are spending a significant portion of their resources and organization bandwidth on new product development, R&D, and customer insights to drive more efficacious products to a targeted audience,” said Sakshi Chopra, MD, Peak XV.
