The online cosmetics and beauty product nicheIndia was leading cosmetic, fragrance and personal care markets worldwide with a revenue of more than 14 billion U.S. dollars. The unorganized retail sector significantly dominated the beauty and personal care products, much like other segments across the country and accounted for nearly three quarters of the market. Another quarter was mostly handled by offline retailers such as chemists, saloons, and supermarkets. Modern trade in general showed a low penetration of online retailers.
While top dogs Amazon and Flipkart had established themselves in India’s e-commerce landscape, cosmetics sales remained largely neglected. This left the niche open for focused online retail of beauty and cosmetic products by Nykaa. In terms of direct competition, beauty retailer Purplle continued to record massive losses just as Nykaa turned profitable in 2020. On the other hand, Flipkart-owned marketplace Myntra, redefined its beauty product portfolio and continued to be a major competitor. Apart from its own website, Nykaa managed to place its products on horizontally organized marketplace platforms including Amazon India.