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The Beauty Co. has achieved returns of $1.5 mn in 9 months of launch: Suraj Vazirani

Suraj Vazirani, Founder & CEO, The Beauty Co., is no stranger to the e-commerce ecosystem. Vazirani had set up online marketplace maniacstore.com in 2011, which sold on all major e-commerce platforms. Faced with several pain points in the selling process, in 2015 Vazirani set up DSYH (Don’t Scratch Your Head), a SaaS (Software as a Service)-based platform that focuses on reconciliation for e-commerce entities – sellers, marketplace or enterprises, and helps e-commerce sellers know their gross profitability. 

Vazirani ventured into the beauty business in June 2018 with The Beauty Co. He feels that the beauty industry has been about remedying problems for too long and that The Beauty Co. is an experience in self-love and that boost of confidence that comes from feeling good. 

The Beauty Co.’s vast portfolio of products includes four main categories – Hair, Body, Skin, and Teeth – and are targeted today’s modern woman. In a short span of time, the company has carved a niche for itself in the women’s grooming industry. 

Being in the e-commerce ecosystem for a long time, Suraj Vazirani has seen the business grow in India. In this interaction with Adgully, he speaks about being an entrepreneur. He also chalks out the growth path for The Beauty Co. and the online as well as offline strategy and more. 

What has the growth been like for The Beauty Co. in its first year of business?
We launched our first product in June 2018. We are doing 400+ units per day online with an ASP of 800+. Currently, we are already sitting at a $1.5 million run rate without even considering the growth figures or new product launches. In less than 9 months of our launch, we are at $1.5 million ARR. Though The Beauty Co. is a fairly new venture, we have been in the online industry for several years. 

While we are headquartered in Ahmedabad, we also have presence in 8-9 states and have around 19-20 warehouses across India. 

From a stage actor, how did you think of setting up The Beauty Co.?
I was into theatre back in my school college days. At that time, I started multiple cyber cafes and then a chain of mobile retail stores. I then built an online marketplace maniacstore.com – that was a time when Baazi was acquired by eBay and no other e-commerce website existed in India. At that time it was hoped that Maniacstore would become the next Flipkart; it was our first dream as a start-up. 

Over time, we realised that this requires a lot of VC funding, so we didn’t go ahead with that idea even though Maniacstore kept on running. During those days we used to sell any and every category of products such as mobile phones, computer peripherals, consumer appliances and home appliances – all branded items. Three years ago, we realised that there was no margin at all in selling brands where 10, 20 or 50 people are competing with each other. Ultimately, huge turnovers, minimalistic margins and hell of a lot of returns and losses start piling up. 

We pivoted our business model and joined hands with Beardo, who was our exclusive pan-India e-commerce partner. Those were the days when Beardo had just started and was doing 25-30 units a day. Post Beardo, a lot of brands joined us for pan-India e-commerce partnerships and we used to manage their entire online business. 

I have always wanted to have my own brand. Since Beardo was already present in the male grooming category and I was the partner, there was no point getting into that. In the last two years the e-commerce scenario has changed vastly and so have the consumer buying patterns. Previously, consumers were rigid about buying only renowned beauty brands like L’oreal or Lakme, etc. Nowadays, take any category and you will find more and more private labels coming up, and online marketplaces are where they are getting exposure and growth. After a lot of research, I found that the women’s beauty industry is expected to touch Rs 80,000 crore to Rs 1 lakh crore in 2020, and even though there is a lot of competition in this space, launching women’s beauty products online could give me a healthy market share. So, after a lot of research we launched a women-oriented brand and that came to be known as The Beauty Co. 

Since the competition is very stiff in this category, how are you creating the awareness for your brands?
We are taking different routes like the fashion blogger route, the marketplace route, running various social media campaigns, video product shoots as well as promoting those videos. We also do a lot of sampling activities. We keep participating in multiple B2B and B2C events. We do youth campaigns and give away freebies. Recently, we created a 50 gm scrub, where 50,000 samples were distributed through Nykaa or other platforms to create awareness and allow the consumer to experience the product. 

We were in talks with Fab Bag for a partnership, but the quantity versus supply was a concern, so the partnership did not happen. 

Who are your primary customers?
Women in the 18-40 age group. If you look at the entire marketing activities and campaigns as well as the look and feel of the brand, they are all made to appeal to this audience range. 

How have you kept your pricing competitive?
The players in the market are either massy brands or super premium brands for niche consumers. The Beauty Co. is neither a massy brand nor a very premium brand. We are in the premium to semi-premium category, where products are at par or better than some well known premium labels, but at half the price. 

Our product prices range from Rs 299 to Rs 1,260. The ASP (Average Selling Price) of the brand as a whole is Rs 800+. 

What drives your marketing strategy?
We were very clear on Day 1 of the launch that we are going to be an online only brand, until and unless we reached X number of units. There is no point in launching a new brand and going offline, talking to distributers and trying to get your products placed in premium and semi-premium retail outlets. We followed our online strategy strictly and we depend 100 per cent on online and social media marketing only. The only tools we use are Facebook, YouTube, Google, Instagram and obviously, the Amazon and Flipkart spaces for marketing. Celebrity influencers, blogger networks and PR agencies are all part of our marketing strategy. 

Till the first week of April 2019 we were only online in almost any and every marketplace in India. This financial year we are planning to go offline in full force. The offline activity will be a slow process starting from Mumbai, Pune and Gujarat. The Western region would be covered in Phase 1. The North would be covered in Phase 2. The South market would be covered in Phase 3 and then we would look at the East. 

For our offline strategy, we would target salons and spas that are also into retail activity. These businesses need brands like The Beauty Co. We already have 3 tie-ups in Mumbai. Initially, we would be supplying to retailers and partners. Once we have sizeable distribution numbers, we would then incorporate the entire pyramid structure of the distributer and retailer model in every city and state. 

Would you also be creating experience stores for The Beauty Co.?
No, that would be too early. Currently, the strategy is very clear. Year 1 was about online only and achieving our targets. Year 2 is going to be about expanding offline and once we have set up a strong presence and strong tertiary sales, then would be the time to launch experience stores.

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