How India’s Women-Focussed D2C Brands Are Leveraging Product Innovation To Challenge FMCG Majors

In today’s thriving digital economy, the relationship between brands and consumers is fast-changing personal, resulting in the emergence of direct-to-consumer or D2C brands that are fast taking over the market. With a majority of bigger brands are stuck in a moat of profits, and their ability to think out of the box, innovate, D2C brands are swooping in and forming direct, meaningful relationships with their customers. This is again something that large companies need to reprioritise in their operations and while they are busy safeguarding the larger chunk of the market share, D2C brands are forging stronger bonds with consumers. 

While a majority of established brands are expanding into the D2C segment with their native ecommerce platforms, majority of sales, however, continue through wholesale and retail partners. For example, recently, FMCG major Marico acquired a 55% stake in Ahmedabad-based men’s grooming startup Beardo, which is an online-first brand essentially sells beard oils, beard waxes, soaps and other products, in addition to the 45% stake that it had acquired in 2017. 

Even as big conglomerates such as Tata focus on online selling through the recent infusion of INR 231 Cr in its online marketplace CLiQ, D2C brands are looking at more interesting ways of acquiring customers. Mumbai-based D2C brand MyGlamm acquiring Delhi-based women-focused digital media and ecommerce platform POPxo to penetrate the market through content and community approach. D2C brands are trying every trick in the book to beat the big brands. 

D2C Startups Vs FMCG Heavyweights 

The new generation of D2C startups are upping the ante and perhaps no other category typifies this as much as personal care segment, where men’s grooming startups are forging new identities, while women and baby-focussed products are capitalising on the D2C wave to outpace some of the traditional heavyweights in this space. 

The women hygiene, baby and personal care giants such as Johnson & Johnson, Himalaya, Hindustan Unilever, ITC, Lakme and others that have dominated the Indian market for decades are being put under the sword by startups such as Mamaearth, BabyChakra, The Moms Co, FirstCry, Bey Bee, Azah, Nua, Pee Safe among others. The women-focussed brigade of D2C brands is banking on unique branding, customer relationship building and social media engagement to stand out among the mass-market products. 

With the support of ecommerce marketplaces such as Amazon, Flipkart, Snapdeal, Nykaa and Paytm Mall, women-focussed D2C brands are not only focussing on their native platforms but also on discovery and delivery through established networks to penetrate deeper into the market. Backed by logistics providers, ecommerce enablers, product design know-how and more, D2C women brands are changing the game. 

Azah cofounder Shashwat Diesh told Inc42 that it currently caters to more than 50K customers across the country, where 60-70% of the sales happen on its website, and 40-30% on other ecommerce sites like Amazon, Nykaa and Flipkart. In the last few months, Azah has touched INR 32-35 Lakh in sales per month, claimed the founder. 

Similarly, Delhi-based The Moms Co also told Inc42 that it has seen great growth in Tier 2 markets, serving close to 1 Mn customers with 2 Lakh orders per month. Mamaearth, which introduced 12 new products focussing on immunity and resilience, has set a target of INR 1000 Cr in annual revenue rate by 2023. 

Until a few years ago, being a successful FMCG company meant having a strong distribution network presence in at least one or two million stores across the county. But ecommerce democratisation has completely disrupted the need for presence in physical stores. “We started out small, and there was no way we could compete with the giants and their massive distribution. We decided to leverage a D2C model to be able to sell a product that’s high quality, affordable and innovative,” claimed Mamaearth founder Varun Alagh. 

The Gurugram-based D2C startup claims to offer safe, mum-baby friendly, toxin-free products for millennial parents and also meets international safety standards. “Our main differentiation, and our biggest advantage, against these big multinational players is that we are Asia’s first brand with MADE SAFE certified products,” the founder added. 

Azah, a Delhi-based women hygiene and personal care startup, also told Inc42 that it is focusing on delivering high-quality products to women, and provide rashfree, chemical-free and organic sanitary pads, unlike some of the mass-produced sanitary napkins competitors in the space. 

Throwing light on the same, Azah’s cofounder Diesh said that most women in India have accepted rashes are ‘normal’ when using sanitary pads. The products that were developed for a generation in the 70s & 80s, which shifted from cloth to sanitary pads and uses harmful chemicals and plastics in the process of mass production, have been used by consumers for a very long time now, and there hasn’t been much innovation in that front, and now, the mindset of people is slowly shifting, where they are starting to realise that rashes are not normal, he added. 

Nua, another new age women-centric D2C brand, which offers a similar line of products as Azah, says it believes in creating an experience and not just a product. Founder Ravi Ramachandran said that trust is crucial in this sector, and providing a holistic experience to customers helps the brand in building more trust. 

Women Hygiene Products To Baby Care, The Ideation Of D2C Brands 

According to GlobeNewswire, the global women hygiene products market is expected to reach $32.7 Bn by 2027, from $22.7 Bn in 2020, growing at a compound annual growth rate (CAGR) of 5.3%. Out of this, menstrual care products are projected to grow at a CAGR of 5.5%, reaching $24.8 Bn by 2027. 

“Obviously, we can not understand the whole aspect of it, as we do not go through a menstrual cycle. But, through our extensive research, feedback from customers and consulting with doctors, we found out about the rash issue,” said Azah’s Diesh, emphasising on how the company’s product is directly linked to women and how it takes customer feedback seriously. In fact, the idea of starting Azah came about when Diesh happened to overhear the conversation between his mother and sister, who were complaining about sanitary pad-linked rashes.

Along with ex-Ola, Snapdeal employees and avid entrepreneurs Aqib Mohammad, Diesh founded the company in November 2018 which has received backing from backed by Titan Capital, the investment vehicle for Snapdeal cofounders Kunal Bahl and Rohit Bansal, AngelList India and other angel investors. 

“Initially, we were lucky to have those kind of women in our ecosystem, who were very receptive and didn’t shy away from answering our queries, be it our family, friends and their wives,” Diesh recalled about breaking the stereotypes and challenging the taboos associated with menstruation in Indian society. 

When it comes to baby personal care space, the global market is expected to reach $8.2 Bn by 2026, growing at a CAGR of 7.5%, as reported by businesswire. The report further stated that the birth rates in developing countries have risen, consumer awareness of child hygiene has increased, consumer availability has increased, and changes in lifestyle is said to fuel the market growth. 

“We are a generation of Google parents. Every choice that we make for our children, right from feeding bottles, shampoos to the paediatrician, we thoroughly research before making a decision. The parents are becoming much more informed about the brands, products and their specific ingredients. After many rounds of qualitative research with millennial parents, we realised that there is a big gap in the demand and supply for toxin-free baby care products,” said Mamaearth founder Alagh. 

In a country where most of the baby products available were not safe due to the lack of safety regulations, natural products which are safe by international standards have seen massive adoption. The same is true for the men’s grooming category as well in the post-Covid market.

Azah claims its products are MADE SAFE certified, which is tested to be free from all harmful chemicals by Safe Cosmetics Australia. The pads are packed in biodegradable disposable bags for eco-friendly disposal purposes, along with providing free doorstep delivery on orders. 

For Mamaearth, the biggest challenge was to find manufacturing partners, who were ready to work with its specified set of ingredients. All the ingredients and raw material used have to be certified as being toxin-free and naturally sourced. 

“We did not give up until we found the perfect partners — people who were catering to export markets and had strong ISO, WHO, and JNB certifications already. Not only did we find the right partners, but they also built some incredible relationships with them,” said the founder. 

[With inputs from Shanthi S]