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Naina g - Project report

BBA (Chaudhary Charan Singh University)

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Mini Project – 2 Report

On

“MAMAEARTH COSMETIC INDUSTRY”

Submitted for the partial fulfillment of the

Award
Of

Master of Business

Administration

DEGREE
(Session :2021- 2022)

SUBMITTED BY
NANDINI
GUPTA
21027200093

UNDER THE GUIDANCE OF

Prof. Aarti Loomba

Department of Business

Administration

Greater Noida Institute of Technology (MBA Institute)

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AFFILIATED TO
DR. A.P.J. ABDUL KALAM TECHNICAL UNIVERSITY (FORMERLY
UTTAR PRADESH TECHNICAL UNIVERSITY), LUCKNOW

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Student Declaration

I “NANDINI GUPTA” hereby declare that the work which is being presented in this report
entitled “MAMAEARTH COSMETIC INDUSTRY” is an authentic record of my own work
carried out under the supervision of Prof. “AARTI LOOMBA”.

The matter embodied in this report has not been submitted by me for the award of any other
degree/ Diploma/ Certificate.

Greater Noida Institute of Technology (MBA Institute)

Nandini Gupta
Date: 10 June 2022

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Director Certificate

This is to certify that the work which is being presented in this report entitled “MAMAEARTH
COSMETIC INDUSTURY” is an authentic record of the student carried out under my supervision.
The statements made by the candidate are correct to the best of my knowledge.

Prof. (Dr.) Rudresh Pandey Name of Supervisor: Prof Aarti Loomba

Director, Designation: Assistant Professor
Greater Noida Institute of Technology (MBA Institute)
Date: 10 June 2022

(Seal of the Department/ College)

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Acknowledgment

Any project would be incomplete without the support of a team or person. Hence, I would like to
thank everyone associated with the project for their immense help and support. With warm
regards, I would like to thank my supervisor Prof. Aarti Loomba, for their immense help,
support, encouragement, and guidance continuously provided to bring out this report.

I would also like to thank my parents, friends and seniors who have guided me and kept
me updated from time to time. Without their help this project would not have been the light of
the day.

DATE: 10 June 2022 (NAME OF STUDENT)

PLACE: GREATER NOIDA NANDINI GUPTA

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Content Page

Topics Page No.

1. Introduction 1

2. Market size of the industry in India 2

3. Business Model/s 3

4. Market Strategy 4

5. Major Competitors 5-6

6. Estimated Market Size 7

7. Emerging Technology Impact 8

8. Conclusion 9

9. Bibliography 10

10. Appendices 11

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MAMAEARTH

INTRODUCTION AND ITS OVERVIEW

MAMAEARTH is Asia’s first MadeSafe certified brand. MadeSafe is a US based not for profit
organization, who checks every ingredient that goes into the product and after a thorough check,
certifies a product to be safe. It ensures the product is free from the 8000 known toxins in the
world. Mamaearth products are all-natural, hypoallergenic, clinically tested and pH balanced.

HISTORY: -

Mamaearth was founded in September 2016 by Ghazal Alagh and Varun Alagh, to make
skincare routines a little chic but with utmost care. Headquartered in Gurugram (India), Mamaearth
is distinguished in the cosmetics industry of India as an online platform that offers natural and
toxin-free skin care products.

During the session with ‘JoshTalks’, the founder Ghazal Alagh shared that when her son Agastya
was born he was suffering from rare skin disease due to which any kind of products was doing
rashes on his skin which was making his health worse and seeing her son in that condition she used
to feel guilty that despite being a mother she was helpless and at that moment she realized that no
child across the country deserves this kind of pain. With that motive, Alagh along with her husband
decided to start Mamaearth in the year 2016 inside which all the ingredients which will be going
to be used to make the product will be toxin-free and elements that mother nature was providing
us free of cost.

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INTRODUCTION: -

Mamaearth was Asia’s first to receive MadeSafe certification for their toxin-free products in just
four years. Mamaearth aims to reduce parental stress and is constantly improving and innovating
to make the world safer for babies and parents.

Mamaearth began with six baby care products. Now Mamaearth offers hair and skin care products
for men and for women. There are 80 SKUs and products that are specifically for pregnant women.
More than 1.5 million Indians have been served by the company in over 500 cities.

Over the period, the Mamaearth brand successfully earned international customers under her
leadership. Apart from India, the company also takes orders from neighboring countries like Nepal,
Bangladesh and many more. Recently, the company launched their Mobile App with the same
name and can be downloaded from Google Play store and IOS store.

Points Information
Company Name Mamaearth
Date of Establishment 2016
Establishment Place India
Founder Varun Alagh
Net Worth (as on 2020) Rs.115 crore (approx.)
Telephone No. 91 8901 555 444
Plot No.63, 4th Floor,
Registered Address
Sector-44, Gurgaon, Haryana India
Email care@mamaearth.in
Company Status Active

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MARKET SIZE OF MAMAEARTH IN INDIA

Direct-to-consumer (D2C) skincare and beauty brand Mamaearth is in talks to raise around $300
million in a planned IPO in the next 12-15 months and is seeking a valuation of around $3 billion,
according to a Reuters report. The Sequoia Capital-backed Indian skincare startup was last valued
at $1.2 billion in January 2022 when it raised fresh funds from investors including Sequoia and
Belgium's Safina. Mamaearth is targeting a valuation of around $3 billion – 10-12 times forward
earnings based on sales growth and future revenue potential, the report stated. It plans to file draft
regulatory papers by the end of 2022.The skincare startup is in early-stage discussions to raise
nearly $300 million through its initial share sale, with the number pegged at $350 million. The
firm is reportedly in talks with JP Morgan Chase, India's JM Financial and Kotak Mahindra Capital
to appoint them as bookrunners to the deal.

Founded in 2016, Mamaearth has become popular in India with its range of "toxin-free" products
such as face washes, shampoos, and hair oils. It competes with Unilever's India unit, Hindustan
Unilever, and Procter & Gamble Co in the booming personal care industry. Mamaearth’s IPO plans
come during a broader rout in capital markets and a slowdown in India's booming startup
ecosystem that recorded a Steller $35 billion in record fundraising last year. Now, some startups
are cutting back on staff and finding it difficult to raise funds. Mamaearth was co-founded by
Varun Alagh, a former Hindustan Unilever executive, and his wife Ghazal. With the brand
endorsed by popular Bollywood celebrities, the duo has cashed in on growing e-commerce
adoption in India by offering its products on platforms such as Amazon and Walmart's Flipkart.

India's beauty and personal care industry is expected to grow to $27.5 billion by 2025, from $17.8
billion in 2020, Indian financial services firm Avenues estimates. The number of online shoppers
for beauty products is also projected to rise to 135 million from 25 million during that period, it
added. One equity research analyst, however, said the success of Mamaearth's IPO could hinge on
how it plans to rapidly expand into offline sales. Most Indians still go to retail outlets to shop, with
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e-commerce accounting for just 5-6% of spending.

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BUSINESS MODEL OF MAMAEARTH

The Business Model of Mamaearth is straightforward. They formulate products that are later
produced by contract manufacturers under the permit of the Mamaearth brand. They mainly sell
online through D2C Channels like Amazon, Flipkart, etc., and other offline stores. They have an
omnichannel presence.

1) Connecting with their Target Audience:

The most important thing for any brand is to connect with its Target Audience and gain their trust.
This is what Mamaearth did brilliantly. From the start itself, they targeted Mothers and made
advertisements that resonated with them. As the Founders themselves got the idea of Mamaearth
when they were looking for toxin-free and natural baby products online, they knew what parents
wanted for their babies.

2) Superior Quality Product:

The Founders of Mamaearth believe in providing quality products to their customers. As they have
a superior quality product, people themselves recommend their products to other people. Word of
Mouth Marketing has done miracles for their brand. IN 2019 Mamaearth got “One of the Best
Brands” in India Award at the 2nd edition of The ET Brand Festival. They have come up with
unique products that attracted a lot of people. Some of their unique products include India’s first
bamboo-based baby wipes, 100% natural plant-based toothpaste for children, skin, and hair care
products with natural ingredients like onion, Coco, charcoal, and ubtan.

3) Lean Innovation Cycle:

Lean Innovation follows a principle where you focus on increasing efficiency by continuously
listening to your customer’s feedback. Your main priority is experimentation and continuously
improving your product quality. Lean Innovation helped Mamaearth to understand their customer
needs and fulfill those needs immediately. Experimentation helped them to increase the quality of
their products and to generate new product ideas. In a very short time, they satisfied their customers
using this method.

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MAMAEARTH MARKETING STRATEGY

1) Influencer Marketing:

Mamaearth has worked with a lot of Influencers on the Internet. Influencers have helped the
company to reach a wider audience and thus increased sales. Influencers tell the benefits of these
products on various social media platforms. Mamaearth also works with five hundred mother
bloggers to spread awareness about the brand.

2) Brand Endorsement:

Collaborating with Bollywood Actress Shilpa Shetty Kundra as a brand ambassador must be their
best marketing strategy. Shilpa Shetty has a lot of popularity, so she becomes a brand ambassador
and an Investor hugely benefited Mamaearth.

3) Digital Ads:

Mamaearth majorly promotes itself through Digital Ads. They have smartly utilized Digital Ads
and increased their customer base. Their Ads are very catchy and symbolize their brands in an
effective manner.

Through digital campaigns, Mamaearth reached out to social media influencers for brand
awareness and worked heavily to target millennials. To target the market beyond metro cities, the
company focussed on television advertisements as well. They partnered with the Viacom18
network of channels to become sponsors of popular shows. Another thing that the company should
look into is the stiff competition in the FMCG sector. Considering the exponential growth in this
segment, the big players will try to dominate the market again using their strong supply chains as
soon as the pandemic situation is eased further. As Mamaearth is already focussing on expanding
offline stores and headcount, they have to build efficient supply chains and strong logistics to retain
the growth and tackle the competition.

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MAJOR COMPETITORS OF MAMAEARTH

1. MY GLAMM

MyGlamm is an Indian company of beauty cosmetics. The company headquarters is in Mumbai,

Maharashtra, India. It is the fastest growing consumer beauty brand. The company provides a large
range of products from makeup, haircare, skincare, sanitizing care and most popular product is
lipsticks.

MyGlamm established in in 2017 by Darpan Sanghvi. It provides a marketplace for stylists,

beauticians, nail, and spa aestheticians to build a community engaging with its customers
providing 100% brutality free and skin friendly products. It is a platform which provides premium
services and gained its customers trust in a very short span of time with services like nail
extensions, scalp treatments, manicures, pedicures and many more. MyGlamm provides more than
600 products with more than 10,000 offline points of sales across 70 cities in India. MyGlamm is
connecting with its consumers digitally as well as provide services at their doorstep with all the
knowledge of the requirements of its customer needs and wants.

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2. NYKAA

Nykaa is India’s leading omnichannel beauty destination that commenced operations in 2012. The
company is headquartered in Mumbai. Nykaa is preferred since it is exclusively focused on beauty,
fashion, and wellness products. The company offers a wide range of products across various
categories such as makeup, skincare, fragrance, haircare, personal care, bath and body, grooming
appliances, health, and wellness. Nykaa is essentially a one-stop shop for all beauty, grooming and
wellness needs.

Falguni Nayyar, a former managing director at Kotak Mahindra Capital Company, founded Nykaa
in April 2012. It was launched as an ecommerce portal curating a range of beauty and wellness
products. The brand name Nykaa is derived from the Sanskrit word nayaka, meaning actress or
"one in the spotlight". The website was first launched around Diwali 2012 and was available
commercially in 2013.
In 2015, the company expanded from online-only to an omnichannel model and began selling
fashion products.
In October 2020, the company launched Nykaa Man, India's first multi-brand ecommerce store for
men's grooming. The company expanded into fashion by launching Nykaa Design Studio, which
was renamed to Nykaa Fashion.
In 2020, Nykaa launched Nykaa PRO. It is a premium membership program that provides users
special access to professional beauty products and offers via the Nykaa App. In Dec 2020, Nykaa
Fashion launched its first store in Delhi, making the fashion business omnichannel

3. PURPLLE

Purplle has differentiated itself in the cosmetics and beauty products vertical by providing
consumers with a personalized shopping experience that takes skin and hair type into account.
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Times have changed for the average Indian woman whose “makeup” used to be just talcum
powder, kajal and Bindi. The last decade – and globalization – have transformed the lifestyle of
the Indian middle class. Riding the wave of economic growth was a bunch of aspiring
entrepreneurs who went on to change the course of enterprising in the country. In late 2011, three
men joined the startup bandwagon by taking a plunge into ecommerce. Purplle began as an online
platform for selling cosmetics and beauty products, a virgin vertical in ecommerce at the time.
Unlike furniture or home decor, there is no customization possible in the beauty and cosmetics’
sector. Since customers already have a certain comfort level with horizontal marketplaces due to
electronics, footwear, and apparels, they tend to go to more categories on the same platforms as
Amazon and Flipkart.

Purple has long been associated with royalty, originally because Tyrian purple dye, made from the
mucus secretion of a species of snail, was extremely expensive in antiquity. Purple was the color
worn by Roman magistrates; it became the imperial color worn by the rulers of the Byzantine
Empire and the Holy Roman Empire, and later by Roman Catholic bishops. Similarly in Japan, the
color is traditionally associated with the emperor and aristocracy.

According to contemporary surveys in Europe and the United States, purple is the color most often
associated with rarity, royalty, magic, mystery, and piety. When combined with pink, it is
associated with eroticism, femininity, and seduction.

4. PLUMGOODNESS

Plum Goodness is an Indian company of Skin,

Hair & Makeup. The company headquarter is in
Thane, Maharashtra, India. It is 100% vegan
brand. Plum Goodness has stood out for its
claims on being free of phthalates and parabens.
It’s also one of the few skincare brands to offer
skincare by and skin textures including
sensitive skin and acne-prone skin.

"Plum is an Indian 'Body Shop,'" says Ashita Aggarwal, head of marketing at SP Jain Institute of
Management and Research. The brand is based on similar beliefs of using natural ingredients and
not relying on chemicals. Products
● Skin Care
● Hair Care
● Body Care
● Makeup

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ESTIMATED MARKET SIZE AND MARKET SHARES

Honasa Consumer Pvt Ltd, parent of Mamaearth and The Derma Co, which recently joined the
unicorn club, has turned profitable in 2020-21 (FY21) after the D2C (direct-to-consumer)
company’s revenue surged more than four times during the period. Honasa Consumer reported a
net profit of ₹24.6 crore for FY21 against a net loss of ₹5.9 crore in 2019-20 (FY20), the company’s
filings with the Ministry of Corporate Affairs (MCA) show. During the period, the company’s
revenue from operations jumped to nearly ₹461 crore against ₹109.7 crore a year earlier, which
helped the company’s bottomline, even as the company’s total expenses jumped nearly fourfold to
₹430 crore. The numbers reported by Honasa Consumer were on a standalone basis.
The company’s exports, albeit on a low base, saw exponential growth in FY21. The company
clocked exports worth ₹8.2 crore in FY21 against ₹86 lakh in FY20. Share of exports in the
company’s total operating revenues grew to 1.8%, from 0.9% a year earlier.
Honasa Consumer becomes one of the very few unicorns such as Nykaa and Of Business to turn
profitable in India. While Honasa Consumer had not managed to clock a profit even at EBITDA
(earnings before interest tax depreciation and amortisation)-level until FY20, a strong growth in
its financials for FY21 suggests that demand for D2C products has surged since the onset of the
pandemic in 2020.
Bombay Shaving Company, another D2C brand, is eyeing profitability by next financial year, the
company’s Founder and Chief Executive Officer had told VCCircle last week.

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Honasa Consumer had turned unicorn (a private company with over $1 billion valuation) after
raising $52 million from Sequoia Capital affiliate, making it the 44th unicorn since January last
year. The company had said that it would be using the funds for inorganic growth and to launch
new brands and expand its portfolio.

EMERGING TECHNOLOGY IMPACT

FMCG brand Mamaearth on Thursday said it has appointed Jayant Chauhan as Chief
Technology and Product Officer. "In his new capacity, Chauhan will oversee the overall product
strategy and engineering and will lead the product development and infrastructure teams," the
company said in a statement. Mamaearth said it has exhibited disruptive growth in the last four
years, and to further accelerate the scale-up, it has decided to add Chauhan to the team who
brings with him over 15 years. Mamaearth said it has exhibited disruptive growth in the last four
years, and to further accelerate the scale-up, it has decided to add Chauhan to the team who
brings with him over 15 years of systems and product development expertise.
Varun Ghazal, Co-Founder and CEO, Mamaearth said: "...Being a digital first brand, it is critical
to constantly innovate and keep pace with the technological advancement to make the consumer
experience enjoyable and seamless. "The brand is at a tipping point wherein it is crucial to build
a strong foundation to sustain the disruptive growth the brand envisions, and hence we brought
in Jayant".

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CONCLUSTION

In the trendy world of social media marketing, reels, photos, and Instagram live sessions are all
the buzz nowadays and the social media influencers have firm grasp on this perfecting this art. So,
hiring them for endorsing one’s product is again a good strategy.
Shilpa Shetty Kundra is a glaring example of such a celebrity who has invested a substantial capital
in direction of company’s growth. Not only social media influencers but Mamaearth works with
almost five hundred or more bloggers for spreading its content. Blogs and short-writeups are
catchier to a general customer than research papers. This helps the company to maintain and sustain
a powerful online presence.
When an influencer endorses some brand like Mamaearth, the content travels throughout the
individuals in their local area and it is portrayed in a overhyped tone since the main intention of
such influencers is to impact people around them. They explain and educate their followers about
thelab-testedproducts and clinically proven results of companies such as that of Mamaearth.
Shilpa Shetty Kundra has become a brand ambassador and investor of the brand, and this has
accelerated and expedited the growth and progress of this company to an astronomical scale. Shilpa
herself has an amazing media outreach and a strong online presence on all social media and she
has used, engaged, and implemented all the recourses which were at her disposal to promote the
brand that she believes in.

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BIBLIOGRAPHY

1. https://www.livemint.com/companies/start-ups/mamaearths-parent-clocks-first-ever-
profit-as-revenue-jumps-fourfold-11641888395218.html
2. https://crazum.com/mamaearth-wikipedia/
3. https://www.similarweb.com/website/mamaearth.in/competitors/
4. https://www.cbinsights.com/company/mamaearth/financials.

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