admin
August 21, 2025
Praveen Paramasivam, Reuters
August 21, 2025
Summary
India's luxury beauty market to quintuple by 2035
Domestic brands account for less than a tenth of sales
Global brands modify offerings for IndiaIndia’s luxury beauty market is expected to quintuple to $4 billion by 2035 from $800 million in 2023, driven by its young, affluent, social-media savvy shoppers with rising disposable incomes, consulting firm Kearney and luxury beauty distributor LUXASIA said in a report.
Luxury beauty makes up just 4% of the $21-billion beauty and personal care market, compared with 8% to 24% across top Southeast Asian countries and 25% to 48% in developed markets including China and the United States.
That means there is plenty of room for growth.
“India is the last bastion of growth for premium beauty,” said Sameer Jindal, managing director for investment bank Houlihan Lokey’s corporate finance business in India.
“The Indian consumer is willing to experiment and try out new things.”
U.S. beauty giant Estee Lauder home to the brands Clinique and MAC, expects a strong runway for expansion and long-term growth in India, even as it grapples with soft sales in the Americas and Asia-Pacific.
“India today, within the Estee Lauder network, is looked at as one of the priority emerging markets,” said country general manager Rohan Vaziralli, highlighting plans to initially target 60 million women in the nation of more than 1.4 billion.
Homemaker R. Priyanka, based in the southern city of Chennai, said she was thrilled to have better access to Estee Lauder’s Jo Malone London fragrance in India, as a benefit of the companies’ efforts.
“It is easier than asking someone (abroad) to get it for you every time,” she added.
While global beauty brands might have to modify some of their products for India, which bakes in sultry temperatures in summer and oppressive humidity at other times, they face little competition from homegrown brands.
Kearney and LUXASIA identified only Forest Essentials and Kama Ayurveda as their major rivals, underscoring how domestic brands make up less than a tenth of luxury beauty sales.
In the more established markets of China, Japan and South Korea by comparison, domestic brands account for a 40% share.
“There is, of course, a premium perception gap between globally established brands and Indian brands,” said Devangshu Dutta, founder of retail consultancy Third Eyesight.
Global beauty giants’ huge marketing budgets also give them an edge over domestic brands, other industry watchers said.
WOOING INDIAN SHOPPERS
Estee Lauder is studying online sales patterns to identify the smaller cities to target, such as Siliguri in West Bengal state, partnering with designers such as Sabyasachi Mukherjee, and launching products such as kohl, an eyeliner Indians favour.
It has also invested in Forest Essentials, a brand with herbal ingredients, and in a programme offering funding to domestic beauty start-ups.
This year France’s L’Oreal said it was investing more in India and tapping into the “elevated beauty desires” of the nation’s young, digitally savvy, empowered women shoppers to drive growth. It declined further comment.
South Korea’s Amorepacific, known for brands such as Innisfree and Etude, is trying to leverage the Korean beauty craze in India with products geared to the market.
These include items for the popular “cleanser, serum, moisturiser, and sunscreen” beauty regimen, the country head, Paul Lee, said.
Japan’s Shiseido, with a history of more than 150 years, brought its NARS brand to Indian beauty retailer Nykaa’s website this year, and plans to step up growth of its brands in the subcontinent.
Global brands are very excited about India, where consumers are splurging more to stay on top of trends such as “cherry makeup”, Nykaa co-founder Adwaita Nayar said, referring to a look featuring flushed cheeks, glossy lips, and soft pink eyes.
Amazon, which has also been seeing a big boom in beauty demand in India, aims to identify emerging global trends and bring in more brands, said Siddharth Bhagat, director of beauty and fashion at the e-commerce company in India.
Retailer Shoppers Stop, which also pioneers foreign labels, plans to open 15 to 20 beauty stores in each of the next three years to boost its revenue from the segment to a quarter from less than a fifth now, its beauty business CEO Biju Kassim said.
Reporting by Praveen Paramasivam in Chennai; Editing by Dhanya Skariachan and Clarence Fernandez
(Published on Reuters)
admin
February 21, 2024
Published in ETPrime, 21 February 2024
Around two years ago, when Delhi-based Debabrata Bhattacherjee decided to explore a new brand for casual wear, he decided to give Uniqlo a try. The 27-year-old was so impressed by the quality that he became a regular customer of the Japanese fashion brand that had set foot in India in 2019.
“What first attracted me was the convenient design of their store, which was very organised and clean. Very Japanese, to say! The shopping experience is very hassle-free and offers a lot of options. Their clothes are very comfortable and the quality is excellent,” said Bhattacherjee, a video producer. Though the brand is costlier than others, he is okay paying the premium.
Bhattacherjee is among the many Indians who have contributed to the rising sales of Uniqlo. Also known to be Asia’s biggest clothing brand, the Japanese company posted a 69% jump in sales in FY23 from FY22, with a net revenue of Rs 624.6 crore and a net profit of Rs 68.38 crore in India.
Uniqlo is among a bunch of Japanese and South Korean brands that have, in the past couple of years, been gaining more space in the lifestyle and beauty product shelves of Indians. Wacoal, MUJI, Innisfree, Sulwhasoo and Amorepacific have been witnessing a relatively quiet but consistent growth in sales in the country.
East Asian portfolio
Indian consumers are not new to the products from these countries. A popular example is automobiles: Suzuki, Hyundai, Toyota and Honda have made millions of Indians mobile. Now, fashion and lifestyle products from East Asia are also now becoming part of Indian households.
Anand Ramanathan, Partner and Leader-Consumer Products and Retail, Deloitte India, said this is because these brands have built a reputation for quality, design and durability — much like their peers in automobiles and engineering.
East Asian lifestyle and beauty brands initially had an influence in the Northeastern states, where the customers are not only ahead of the curve in fashionability but also found resonance with the look of these brands, said Devangshu Dutta, founder and CEO of management consulting firm Third Eyesight. “In due course, K-dramas and K-pop (Korean popular culture) has boosted their expansion across the country. Japan and Korea are highly developed beauty and skincare markets, with customers who are conscious both about their appearance, as well as about the products’ performance. These brands have established brand equity across markets on their quality, innovation, and product development,” he said.
Indians have been enjoying the “Korean wave” or Haalyu, which refers to the global popularity of Korean culture, music, movies, and TV dramas. Ramanathan pointed out that Korean has emerged as the most learnt language among the 13-22 age group in India. Apart from fashion, he said, the cultural impact can be seen in food and jewellery options of Indian Gen Z and millennials.
Well-travelled Indians who have been exposed to these brands find the pricing has “value” implicitly built in, Dutta added.
Companies from these countries also seem to find value in India. A 2023 survey by the Japan Bank for International Cooperation (JBIC) that collected responses from over 500 manufacturers in the island country showed that 48.6% of the companies considered India a key destination for medium-term business growth. Ramanthan cited a report by DPIIT that stated that since 2000, South Korea has invested $5.7 billion in India across various sectors. Recently, South Korea has invested $400 million in India during July 2022 to June 2023.
E-commerce is a driver
Another brand on this list is Japan-based Wacoal. The lingerie maker entered India in 2015 with its first store in Mumbai, and has posted an impressive 3X year-on-year increase over the last eight years, said Pooja Merani, COO of Wacoal India.
This was because its products have adapted designs that align with the preferences of the Indian market, demonstrating cultural sensitivity, she said. The company measures the physique of approximately 1,000 women and girls between the ages of 4 and 69 every year, said Merani. This has helped it make clothes that suit Indians well. “Prioritising fit and comfort in the offerings, and understanding the diverse body types in India, have likely contributed to customer satisfaction and loyalty,” she said.
South Korean beauty firm Amorepacific, which is the parent company of popular cosmetic brands such as Innisfree and Sulwhasoo, said they are seeing traction in India as the beauty and wellness industry is experiencing robust growth. “There is an increasing awareness and emphasis on skincare, with consumers seeking effective and high-quality products. India has a large and youthful population, and the youth are often early adopters of beauty trends. Korean skincare products, with their trendy packaging, innovative formulations, and youthful image, can resonate well with this demographic,” said Mini Sood Banerjee, Assistant Director and Head of Marketing at Amorepacific Group.
The company had last year signed an agreement with Reliance Retail to sell through its online fashion platform, Tira. Banerjee said 80% of its sales are through e-commerce. “INNISFREE has been engaging with the Indian consumer much more rapidly in the online space.”
Uniqlo attributed its success to its blend of Japanese philosophy with Indian culture — the company started selling kurtas from 2019, when it had entered India through Delhi. A spokesperson credited the brand’s success to the 13 brick-and-mortar stores in India focussing on its “LifeWear” philosophy. “It is simple, high-quality, everyday clothing with a practical sense of beauty that is ingenious in detail. This approach originates from the Japanese values of simplicity, quality and longevity — and we have seen that Indians appreciate the high level of quality of our apparel,” the spokesperson said.
Making in India
These companies have also started production in India, a sign that they find the market promising.
Wacoal started its production in India last year, and is expanding into newer segments. The Uniqlo spokesperson said the company is on track to achieve 30% domestic sourcing. “We are actively growing local suppliers to deliver quality products for our customers. For example, we now work with 17 sewing factories and 6 fabric mills in India.”
Fashion, home textiles and other home products are potentially the first categories where manufacturing within India can be explored, said Third Eyesight’s Dutta. Brands with a large global footprint and established supply chains find it difficult to shift manufacturing bases.
“To make a shift to India, a substantial volume of demand needs to be generated within the country, and brands also need to be actively looking to diversify from their existing supply bases. Fashion brands and retailers with product lines that are relatively less technical or complex, or for which the size of economically viable production base is relatively small, are already looking at manufacturing more products and greater volumes in India,” he said.
Foreign brands have to find the product-market fit to be successful in a country. India being an ethnically diverse market, the product-market fit can be dissimilar across the country. Brands can be successful only if they can address specific segments and build the business accordingly, Dutta added.
Companies like Wacoal said they are mindful of the cultural challenges. Merani pointed out how the lingerie market is predominantly unorganised and has challenges such as limited awareness about proper sizing and cultural taboos. “Overcoming traditional industry norms and promoting accurate sizing awareness remains a persistent hurdle for us. Additionally, addressing diverse body types while ensuring top-notch quality further adds complexity,” she said.
‘Affluent India’
Despite the challenges and the steep pricing, experts said these brands are becoming popular as Indians have more disposable income.
According to a recent Goldman Sachs report that corroborated data using tax filings, bank deposits, credit cards and broadband connections, the affluent Indian consumer cohort has grown at a compound annual growth rate (CAGR) of over 12% in 2019-23, compared to 1% CAGR in India’s population. Rising retail participation has lifted India market cap over 80%, it pointed out. “The largest beneficiary of rising ‘affluent India’ are categories such as leisure, jewellery, out-of-home food and healthcare, and premium brands within all categories,” it added.
The willingness of Indian customers to pay a premium price for better quality products depends on factors such as product category, brand reputation, target demographic and economic conditions, said Amorepacific’s Sood.
For Japanese brands, the shift in India from electronics and automobiles to clothing and lifestyle is driven by strategic diversification and changing consumer trends. Japanese companies are leveraging globalisation and the increasing exposure of Indian consumers to international lifestyles, said Wacoal’s Merani.
“Economic factors, such as India’s growing middle-class population and economic growth, contribute to the attractiveness of the market. Thorough market research and understanding of local preferences, along with collaborations and partnerships, enable Japanese brands to align their products with the specific demands of the Indian consumer market. Overall, this shift reflects the adaptability and strategic decision-making of Japanese brands, indicating their confidence in the potential for success in diverse sectors beyond automobiles,” she said.
The Indian market still has legs.
The COO of Wacoal India said the lingerie market, for one, would grow by a CAGR of 9.3%, especially as more young women join the workforce.
India presents a great opportunity as a strong growing market. Even domestic brands are competing for “share-of-mind, shelf-space and share-of-wallet, and some larger Indian corporates are also backing their own brands and retail formats with strong investments,” added Third Eyesight’s Dutta.
If the Japanese and Korean brands want to survive, they would need to keep innovating and adapting to consumer preference. For Indians, meanwhile, it is “ache din” when it comes to shopping.
admin
September 23, 2022
Sagar Malviya, The Economic Times
September 13, 2022
Uniqlo, Asia’s biggest clothing brand, has turned profitable in India in less than three years after it opened its first store in the country despite operating in a period marked by Covid-led lockdowns and restrictions.
The Japanese brand posted a net profit of ₹21.4 crore for 2021-22 compared to a loss of ₹36.1 crore in the previous year, according to business intelligence firm AltInfo. Its sales rose 63% year on year to ₹391.7 crore for the year to March 2022, a slower pace compared to FY21 when it clocked 86% sales growth on a low base.
Experts feel Uniqlo’s strategy of pricing its merchandise at least 20% higher than rivals Zara and H&M has helped it earn better margins despite inflationary pressures in terms of raw materials.
“The market is not easy and turning profitable at a time when most rivals are spending aggressively is a good indication of success. As an international brand, they (Uniqlo) are able to get good locations and are preferred tenants, which helps in generating sales, especially in top cities,” said Devangshu Dutta, founder of Third Eyesight, a strategy consulting firm. “However, the pricing is a bit premium and until they are able to source locally, selling products at a right value for the market will remain challenging.”
The Japanese brand opened its first door in the country in September 2019, but stringent lockdown measures announced in March 2020 to contain the Covid-19 outbreak delayed its store expansion plans, restricting its store count to about seven outlets so far.
Uniqlo has said India is one of the most priority markets where consumers are increasingly shifting from ‘fast-fashion’ to long-lasting essentials and functional wear. “India is an important and very big priority market,” Tomohiko Sei, CEO of Uniqlo India told ET in June.
(Published in The Economic Times)
Devangshu Dutta
March 10, 2008
In a blog-post a few days ago, I’d expressed my long-held view that retail is not an easily globalized business. (Retail models are not global, and global certainly not inevitable)
Local nuances have a big part to play in the success of a retail business – they could be related to the customer, products, packaging, pricing, customer service norms, government regulation, or anything else from the hundreds of local flavours that retail success hinges on.
An example that I often use is that of Asda in the UK.
When Wal-Mart bought Asda back in the late-1990s, there were cries of doom and gloom, calls for government protection, etc. etc. However, the reality was that Tesco clearly emerged as the leader, other UK retailers remained strong, even though Asda gained in stature and market share. Wal-Mart’s takeover of Asda may have pushed its competitors to rethink their business strategies and become more competitive. In the UK market, it’s Tesco that is seen as the 800-lb gorilla, not Wal-Mart. While Asda is a smart retailer (to the extent that possibly even the parent company, Wal-Mart, has learned from it), it does not have the same advantages that Wal-Mart enjoys in the US.
And now comes this news item in the UK newspaper – The Telegraph. Provocatively titled, “Could Asda be kicked out of Wal-Mart?”, it talks about how Wal-Mart considered a partial or complete exit from Asda.
Wal-Mart, like many other retailers who expand internationally, have found that what works at home doesn’t always work overseas – among Wal-Mart’s burdens are Germany (exited) and Japan (underperforming). It is probably too early to tell whether Wal-Mart will achieve its objectives in China, and the Indian business is still to open its doors.
At this time, neither Wal-Mart nor Asda will give credence to the report, for obvious reasons. But the fact is that, like all smart management teams, Wal-Mart’s management evaluates its markets on an ongoing basis, and it has not let historical reasons or sentiments keep it from exiting underperforming subsidiaries (e.g. Germany).
Differences not just in the customers and the market conditions, but even different management styles among countries can throw a retailer’s global ambitions off the planned trajectory.
And these differences keep many a retailer from venturing out of their home market at all.
Its a “big, bad world out there”, and sometimes it’s good to be just home! 😉