This case study will discuss Nykaa’s current marketing strategy, its shortcomings, and the enhancements our student team has recommended to boost their conversion rates. Let’s start by knowing more about Nykaa before we examine the company’s multifaceted marketing plan.
Table of Content :
- About Nykaa
- Product Strategy of Nykaa
- Price Strategy of Nykaa
- Place & Distribution Strategy of Nykaa
- Promotion Strategy of Nykaa
- Competitors of Nykaa
- Marketing Strategy of Nykaa
- Marketing and Advertising Campaigns of Nykaa
- SEO Case Study of Nykaa
- Content Marketing Case Study of Nykaa
- Objective of Nykaa
- Solutions of Nykaa
- Future Plans of Nykaa
- Success Story of Nykaa
- Customer Relationship
- Revenue Streams of Nykaa
- Channels of Nykaa
Falguni Nayar launched the Indian e-commerce business Nykaa in 2012, and it has its headquarters in Mumbai. In April 2012, Nykaa was established by Falguni Nayar, a former managing director at Kotak Mahindra Capital Company. The business switched from an online-only to an omnichannel model in 2015 and started selling items other than cosmetics. On all of its platforms, it sells more than 2,000 brands and 200,000 products.
With warehouses in Mumbai, New Delhi, Pune, Haryana, Kolkata, and Bangalore, it uses an inventory-based business model. Nykaa offers both domestically and internationally produced goods for sale. Over 200,000 goods from 2,000 manufacturers are purportedly available. Nykaa, which had a 2020 valuation of 85 billion (US$1.1 billion), became the first unicorn firm ever led by an Indian woman.
In addition to its principal e-commerce operation, it has 76 brick-and-mortar locations across the nation as part of its offline presence in 2020. Known as Nykaa Luxe, Nykaa On Trend, and Nykaa beauty Kiosks, its three offline retail styles.
Product Strategy of Nykaa
A direct-to-consumer e-commerce company called Nykaa has an inventory-based business model. Products that were bought directly from producers are kept in stock by the company. Third-party merchants offer their products on kiosks in their warehouses, where they keep the goods.
Price Strategy of Nykaa
Pricing is a tremendously complicated activity, and we will only touch on a very small portion of the factors that influence pricing choices. Pricing is significantly influenced by the other 4Ps of marketing product, place, price, and promotion. The highest price a buyer will pay for Adwaita Nykaa.com goods in the available market conditions is known as conceptually perceived value
- Cost Base Pricing
Adwaita Nykaa.com can determine how much it costs to produce a product and add a markup based on the profit it hopes to make under a cost-based pricing approach. It’s possible that the method won’t work in a highly competitive environment with changeable pricing. For instance, Uber, which is losing billions of dollars, may provide lower costs and continue to operate compared to individual taxi service providers who lack private equity and long-term planning.
- Value-Based Pricing
Value-Based Pricing is a pricing approach that is founded on the value that customers perceive. With a strong knowledge of demand elasticity and competitive constraints, it instills the practice of quantifying both concrete and intangible benefits.
Place & Distribution Strategy of Nykaa
Adwaita Nykaa.com provides its items to customers through a place or distribution channel, which is a collection of procedures. Distribution and marketing channels serve a variety of functions, including ensuring product quality, facilitating end-user access to the products, handling logistics, reducing purchase lot size to allow for individualized customer purchases, enabling product customization options at the point of sale, informing customers about the products, offering after-sale services and installation services, and offering a wide range of products.
Promotion Strategy of Nykaa
Adwaita Nykaa.com has access to a variety of promotion instruments, which together make up the promotion mix or integrated marketing communication plan. They are public relations, direct marketing, personal selling, sales promotion, and advertising.
The existence of the product, its pricing, its distinctive qualities, the locations where people can acquire the product, and lastly how customers may efficiently use the product or service are all compelling communication methods that Adwaita Nykaa.com might employ.
Competitors of Nykaa
Myntra.com, one of Nykaa’s main rivals, had the most monthly website visitors among them with more than 64 million visits in June 2022. Mamaearth and Sephora came after this.
The top 5 competitors of Nykaa are as follows:
Marketing Strategy of Nykaa
The majority of Nykaa’s sales and revenue come from digital platforms, which it uses to sell cosmetics across all of its outlets. Digital marketing is the most crucial aspect of a core e-commerce brand’s success. The student team has conducted an extensive studies on the company’s digital platforms, including websites, SEO, and Google Ads. Let’s start by analyzing Nykaa’s website.
Marketing and Advertising Campaigns of Nykaa
Nykaa, an online retailer for cosmetics and personal care products, has released a new television commercial that tells the tales of six strong women who defy gender norms and advance the status of women.
The corporation said in a statement that the commercial celebrates the strength and poise of women. “We honor women for having the intrinsic fortitude to persevere in the face of adversity. The film is based on true tales, and we hope that by doing so, more women will be motivated to boldly pursue their ambitions, “said a representative for Nykaa.
SEO Case Study of Nykaa
Nykaa has a site of its own, called beauty book, where they have blogs on products, fashion, and other topics. They are also very active bloggers. For their beauty book, they publish blogs with product reviews, advice, and instructions. According to similarweb.com, 53.57% of traffic comes from search engines, and they rank for around 55.12% of organic keywords out of them, indicating that a sizable portion of their audience originates from organic efforts.
Their main website has a DA of 55, which is a respectable number, according to moz.com. Other than branded keywords, dusky skin, curly hair, perfumes, and haircuts are among their top-ranking keywords.
Content Marketing Case Study of Nykaa
Content marketing is one of Nykaa’s most effective techniques for attracting customers by providing a variety of easily consumed content to the audience. Nykaa produces blogs on beauty, makeup, and personal care on its own site, “Nykaa Beauty Book.“ The company also produces video material, including how-tos for DIY projects and makeup. The target population is well-targeted by trends like #WhatMakesYouBeautiful, #BreaktheHashtag, and Women’s Day campaigns.
Objective of Nykaa
To build a world where customers can choose from a carefully chosen, genuine range of goods and services that delight and uplift the spirit of people.
Solutions of Nykaa
After reviewing Nykaa’s current marketing plan, the student team developed a number of fresh digital marketing ideas that they will be implementing into the business. The students are suggesting a few new channels, such as email marketing and conversion rate optimization (CRO). Let’s start with their updates to Nykaa’s website approach.
- FSN E-Co Nykaa Consolidated June 2022 Net Sales at Rs. 1,148.42 crores, up 40.57% year-over-year.
- FSN E-Co Nykaa Standalone June 2022 Net Sales at Rs 37.65 crore, up 765.71% year over year.
- 05.08.2022. Nykaa’s Q1 profit increased 42% year over year to Rs 5 crore, while revenue increased 41% to Rs 1,148 crore.
Future Plans of Nykaa
Nykaa intends to increase its presence offline by opening 180 outlets by 2024. Over the next five years, the multi-brand cosmetics shop Nykaa will increase its physical presence in India by building about 180 new outlets.
Success Story of Nykaa
Even if one’s perception of beauty is subjective, the global beauty industry has never lost its allure. Along with the consistent expansion, the sector has attracted a continuous stream of devoted clients across many generations. Who among girls doesn’t enjoy putting on makeup? Cosmetics are a vital part of all of our lives, whether we’re practicing makeup tutorials, experimenting with different colors on free days, getting ready for a wedding or other event, or just applying a fast light layer before work.
However, those times when customers had to physically visit cosmetic stores are long gone. Why should brick-and-mortar businesses be the sole option when there are now online cosmetics stores that enable clients to order things whenever and wherever they want?
There are still a few platforms that have managed to maintain stability despite the COVID19 pandemic shutdown, which has caused the Indian economy to tumble to new lows in recent months.
Nykaa is one of these e-commerce sites for health and beauty products:
it has emerged as the top choice among Indians who adore cosmetics. Everyone who has even the tiniest interest in using wellness and beauty products has heard about Nykaa at some time in their lives. This is an online retailer that focuses on selling cosmetics and beauty products. This platform, which was created in 2012, has been crucial in dispelling the misconception that e-commerce and beauty shops are incompatible.
Following the launch of its IPO and the overwhelming response it received, Nykaa has recently become a household name, making its founder Falguni Nayar one of only a handful of self-made billionaire women in India. As a result of Nykaa’s record listing, according to Bloomberg Billionaires Index, her net worth increased to $6.5 billion.
Verloop.io was used by Nykaa for the first 30 days, during which time it processed almost 1.6 million different talks. Additionally, customers received a button labeled “Beauty Advice.” As soon as they click, the discussion is instantly sent to one of Nykaa’s internal specialists, who will handpick products based on each customer’s preferences, negating the need for manual dialogue assignment. This was possible because Nykaa was able to customize the conversation threads it created on Verloop.io for its users. In these talks, almost 90% of the clients that took part evaluated the Verloop.io bot as great or quite favorable.
Revenue Streams of Nykaa
Nykaa received money from the Zia Mody family, Harsh Mariwala, TVS Shriram Growth Fund, Sunil Munjal, Max Group, and TPG Capital over the course of several rounds. The online beauty shop raised roughly Rs. 75 crores in its most recent round of fundraising in 2018, when the company was valued at Rs. 3,000 crores. The key component of a 170 crore investment round that included both primary and secondary transactions and provided about 95 crores to some existing shareholders was the fund-raising.
The business obtained about 100 crores from Steadview Capital in 2020. The online beauty retailer has been stronger over time by concentrating on consumers’ demands and collaborating closely with partners to achieve the desired outcomes. The estimated value of Nykaa after March 2020 is $1.2 billion.
The online cosmetics shop, which is on track to join the Unicorn club of private companies with a value above $1 billion, raised about 100 crores from TPG Growth in March of last year. Later that year, Nykaa sold secondary shares to raise an additional $30 million from Steadview Capital.
Channels of Nykaa
Nykaa Top Marketing Channels
Direct traffic, which accounted for 36.66% of all desktop visitors to nykaa.com last month, is the site’s largest traffic source, followed by search (31.88%). “Ads” is the most underused channel. Investigate the primary movers in each of the channels below.
Even though Nykaa is unique in the beauty, wellness, and fashion industries, there is always an opportunity for advancement. Due to the world’s fast digitization, large e-commerce brands today control practically every industry. Such e-commerce behemoths now need to amp up their digital strategy in order to boost their conversion rates. The student team claims that their modifications can raise the CRO from 0.5% to 2%.
The next step for most businesses is to raise their conversion rates because they now use digital marketing techniques to advertise themselves online. Conversion rate optimization, or CRO, is a developing area of digital marketing that aims to boost a business’s marketing effectiveness by developing well-integrated strategies and automation. Check out the most recent Conversion Rate Optimization course offered by EDIIFY to get started if you want to learn more about the expanding subject of CRO.
Do you desire more information? visit our website to learn more. You can also look at the digital marketing course offered by ediify.com if you’re interested in learning more
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