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Indian cosmetics go local, natural and organic

Latha Srinivasan | Updated on September 25, 2020 Published on September 25, 2020

For desis, by desis: Local manufacturers responded to the need for products that suited Indian skin types and hair, a demand that global brands had failed to meet   -  M PERIASAMY / THE HINDU

The booming Indian cosmetics market is stormed by home-grown brands that promise to pamper Indian skin with the goodness of local, natural and organic products

* A significant segment of this demand is for products that suit Indian skin types and hair — a need that largely remained unfulfilled by international brands, providing the perfect opportunity for local companies.

*A growing movement away from chemical to natural — and, by association, safer — ingredients has seen these companies tap into the country’s centuries-old repertoire of ayurvedic and other organic remedies for their formulations.

Setting up a tiny stall at Mumbai’s Lil Flea Market in April 2018, Desiree Pereira, Shivangi Shah and Lakshay Mohendroo hoped that their matte lipsticks would find a few takers at least. That weekend, they sold over 300 pieces and instantly knew their decision to give up their jobs as researchers in the cosmetic industry and bootstrap their own beauty venture had been the right one. Today, their company, the Mumbai-based Disguise Cosmetics, has through word-of-mouth snagged a faithful clientele that swears by the ‘vegan and cruelty-free’ beauty products.

Long before the government sounded the ‘vocal for local’ call for Indian businesses in 2020, the country’s beauty and cosmetics industry had begun witnessing a surge in home-grown brands. And powering their growth is a steady rise in consumer demand in India, which is the fastest growing cosmetics market in the world, says Shennai Pushkaraj, member of CII Retail Committee and CEO of cosmetic major Lakmé.

The Indian cosmetics market, valued at nearly $11.16 billion in 2017, is expected to grow at 5.91 per cent (compound annual growth rate) during 2017-25, Pushkaraj tells BLink. “The annual retail sale of cosmetics and other personal care products is growing in the range of 15-20 per cent... Over the past five years, total demand has grown by 60 per cent,” he adds.

A significant segment of this demand is for products that suit Indian skin types and hair — a need that largely remained unfulfilled by international brands, providing the perfect opportunity for local companies. Some of the bigger home-grown names include Khadi Essentials Plum, MamaEarth, Kama Ayurveda, Forest Essentials, SoulTree, Dr Sheth’s, Neemli Naturals, Juicy Chemistry and Daughter Earth.

A growing movement away from chemical to natural — and, by association, safer — ingredients has seen these companies tap into the country’s centuries-old repertoire of ayurvedic and other organic remedies for their formulations.

Dharani Gopalan, an investment banker in Chennai, says her work entails travelling constantly to meet clients and she needs to guard her skin against the sun and air pollution. The search for a chemical-free skincare product led her to Juicy Chemistry in 2016. “I have tried their cell construction night serum, aavarampoo and bergamot face scrub, and all-day face cream with carrot seed. These suit my skin perfectly,” she says. Another big draw for her are the newer products the company rolls out frequently.

Skin in the business: Megha and Pritesh Asher founded Coimbatore-based Juicy Chemistry in 2014 and notched up sales of ₹17 lakh in the first year   -  M PERIASAMY / THE HINDU

It helps that the customised local products are pocket-friendly, compared to the international brands. A face wash from the latter, for instance, can set you back by ₹900-1,500 for 125 ml. A 50-ml product from one of the Indian labels, on the other hand, comes for ₹250-350.

Buyers like Smrity Sharma, a media professional in Mumbai, also value the personalised customer care. “I sometimes have queries about the ingredients or other aspects. I can go to the brand’s Instagram page and get them clarified within a day. They are open to feedback also. With an international brand that is just not possible. The women who work at their beauty counters are not experts — they only sell the products. That’s not enough for me.”

Making up young minds

The last few years have seen a shift in the consumer base, thanks to changing lifestyles, increasing awareness and incomes, and accessibility. Beyond just the usual requirements of nail polish, lipstick and kajal, there is demand for skincare products to treat specific problems and target areas, ranging from lip care to dark circles around eyes, post-natal stretch marks, hygiene washes and more. The buyers for these new-age Indian labels are mostly young, urban dwellers (particularly women in the 18-35 age group) who are financially independent.

Under the impact of the so-called beauty influencers — millennials who have a large following on social media and can influence the purchase of cosmetic products — young consumers are no longer just seeking brand names but “meaning over materialism”, states a report by the FMCG giant Hindustan Unilever Limited, which had launched the homegrown Lakmé cosmetic brand in 1952. The report adds that young buyers are “demanding brands with a point of view and more authenticity, transparency and sustainability”. So labels that flaunt creds such as ‘natural’, ‘organic’, ‘vegan’, ‘against animal testing’ and so on find ready takers.

Take the seven-year-old Gurugram-based beauty products manufacturer SoulTree, for instance. CEO and founder Vishal Bhandari says he wanted to create a sustainable demand for organic herbs grown by small farmers, especially women, in Uttarakhand. “This led me to develop a beauty and personal care line made from these herbs. I also saw a complete absence in the Indian market of a genuine certified natural and organic beauty brand and felt that this would be pioneering a trend in the right direction,” he says.

Prasanthy Gurugubelli, co-founder of Hyderabad-based Daughter Earth

 

Sometimes, it’s been a personal need for such products that has led to a business. Prasanthy Gurugubelli, co-founder of Hyderabad-based Daughter Earth, says her company grew out of her need for products suited to her sensitive skin. “We wanted to create the most rigorously researched and scientifically formulated skincare with plant-based bioactives, right here in India.”

Aneesh Sheth co-founded Mumbai-based Dr Sheth’s

 

Leading cosmetologists and dermatologists have also ventured into the manufacturing of skincare products suited to Indian skin types and without harmful chemicals. Mumbai-based cosmetic scientist Aneesh Sheth co-founded Dr Sheth’s in 2016 to manufacture a line of products that are vegan, and sulphate-, paraben- and phthalate-free. His mother, Dr Rekha Sheth, was a pioneering cosmetic dermatologist, and his grandfather Dr Sharat Desai was one of India’s earliest dermatologists. “We have a wealth of experience to demonstrate how different Indian skin is — from the melanin to our environment and pollution,” he says.

Investing in good looks

Begun on their own steam and starting out small, many of the home-grown beauty product companies relied on their own funds in the initial years. Gurugubelli invested her personal savings of ₹15 lakh to launch Daughter Earth in 2018 while the founders of Disguise Cosmetics invested their savings of about ₹10 lakh to get going.

Neemli Naturals was started in 2015 with an investment of just ₹2 lakh, but relaunched in May 2018 with an investment of ₹1 crore. Bhaskara Seth, co-founder of the Mumbai-based company, says he was always interested in naturopathy and other natural remedies, but his meeting with a cousin who was a soap-making hobbyist proved path-changing for him. In 2015, he and his mother started making and selling handmade soaps and scrubs in flea markets in Goa. “It grew organically and gradually, from the end of 2015 onwards, in a small stall in The Arpora Goa Flea Market,” he recounts.

But investors have quickly latched on, sensing the inherent potential in this segment. Launched in 2014, Coimbatore-based Juicy Chemistry was entirely bootstrapped and notched up sales of ₹17 lakh in the first year. Five years down the line, Amit Nanavati, senior director and board member of Chennai-based Raj Petro Specialities, infused ₹4.5 crore and the company is projected to register a ₹15 crore turnover this year.

Similarly, after Dr Sheth’s was launched in 2017, the following year it managed to raise ₹2 crore through the venture capital firm Mumbai Angels and a few individual investors. “We have been growing consistently at 100 per cent year on year,” says Aneesh Sheth.

Testing grounds

Nearly all the companies advertise their use of natural ingredients — sourced from across the country and even the world — as a differentiating factor. Their other claim is their use of tests, trials and research and development to improve existing products and launch newer and better ones. SoulTree says it embarked on its R&D processes in 2008, long before it took its products to market in 2013. “We have an in-house R&D team. Not only are we the first certified brand in India, we are also the first to introduce ayurvedic make-up and sustainable packaging such as paper wraps and tapes,” says Bhandari.

Daughter Earth prepares hundreds of prototypes after shortlisting ingredients based on published scientific literature and ayurvedic texts, says Gurugubelli. “For every formula we are sharing with the world, we’d have 30-35 really good ones that didn’t make the cut,” she adds.

But who exactly is in charge of certifying these products as natural, organic, vegan, and so on? There is no one certifying agency in India and the manufacturers usually approach various international accreditation bodies. PETA [People for the Ethical Treatment of Animals] issues the Cruelty Free Certification, while Brussels-based COSMOS, an international and independent association, issues certificates for natural and organic products that meet its standards. BDIH (the German Association of Industrial Companies and Trading Firms for pharmaceuticals, healthcare products, food supplements and personal hygiene products) is another popular accreditation body.

Not just skin deep

The fact that Indian beauty brands — big and small — have flourished in the last five years and the entrepreneurial spirit is alive and kicking, bodes well for the Indian economy, too, says Pushkaraj. “Indian beauty brands continue to harness the power of natural blends and organic ingredients, to create products that look good, and, more importantly, feel great. Not only can they rival their foreign counterparts on quality and beauty benefits, but they’re also much more affordable, accessible and, at the end of the day, beneficial for our economy.”

Latha Srinivasan is a journalist based in Chennai

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Published on September 25, 2020
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