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Top 10 D2C brands of India

abhishekverma0109 — Mon, 11 Jul 2022 05:46:43 +0000

With the pandemic changing the pace of enterprises and consumer approach, along with the rise of e-commerce, several start-ups and D2C companies have started popping up in the Indian business ecosystem.

The D2C model or the Direct-to-consumer approach allows the brands to acquire profits along with higher popularity and visibility in the market. Brands across the globe are shifting towards the D2C model, removing the middlemen. More than 800 new-age brands from India have gone Direct-to-consumer.

Brands like Wow Skin Science, Sugar Cosmetics, Mamaearth, etc. have challenged well-established brands such as the Himalayas, ITC and HUL.

The D2C brands from all sectors including lifestyle, fashion and cosmetics, FMCG and electronics experienced advancements in various aspects. We have curated a list of the top 10 D2C brands of India that had the greatest impact on the market.

Here are the D2C brands we are going to cover in this article:

Mamaearth

When Ghazal and Varun Alagh were expecting their baby, they wanted to do everything to keep the baby safe. They searched for products they could use to pamper their bundle of joy, but no product in the market matched the safety standards.

This experience drove them to create a brand by a parent for a parent.

The company started with only 6 products but has now expanded to over 100 SKUs. During the lockdown, they launched 12 new products with ingredients Vitamin C and Bhring Amla.

The company’s products are being sold in 40 towns and over 2000 stores across India. Mamaearth made its appearances all over the e-commerce websites such as Amazon, Flipkart, Firstcry and Nykaa. Around 90% of its sales come from these platforms.

In 4 years, it became Asia’s first brand to get the MadeSafe certification for its toxin-free products. Within 5 years it became one of the E-commerce Unicorns of India with a valuation of 1.1 billion dollars as of March 2022.

Sugar Cosmetics

Founded in 2015 by Vineeta Singh and Kaushik Mukherjee, Sugar Cosmetics is one of the fastest-growing makeup and beauty start-ups in India. It mainly targets Indian Women between the age of 18-25. The brand’s products last longer in all weather conditions and are compatible with Indian skin tones.

Its products are usually available at Lifestyle, Health and Glow, NewU, Nykaa and Shoppers Stop. The brand has carved a niche in the Rs. 600 - 800 price segment. While their lip products account for about 60% of their total sales, the rest comes from their face and eye category, the star product being the long-stay Kohl Kajal.

Sugar cosmetics reported a 21.6% rise in revenue in FY21, as compared to 2020. Moneycontrol has reported that it currently has an annualised revenue of Rs 320-350 crore. It has recently raised $50 million in Series D fundraise led by the Asia fund of L Catterton, valuing the company at $500 million. Sugar said it is trying to scale up its physical presence to 40,000 retail stores in over 550 cities in the next 24 - 36 months.

Wow Skin Science

Arvind Sokke, Ashwin Sokke, Manish Chowdhary and Karan Chowdhary started off with a dream of making it big in the skincare and lifestyle industry. Founded in 2014, the company managed to build a business via e-commerce and a small offline presence.

It sells over 250 personal care and wellness products through its own website and platforms like Amazon, Flipkart, Nykaa and Purplle. The brand’s most popular product was its Apple Cider Vinegar Range. Wow sold the 200 ml shampoo bottle at Rs 399 while the competitors were charging about Rs 1,299 for the same product.
The company’s marketing strategy revolves around people’s interests by educating them about their innovative products via videos and influencer marketing. The company has clocked a revenue of nearly Rs 500 crores and expects to reach Rs 800 crores by the next fiscal year.

At present, Wow Skin Science is available in about 15,000 stores. In the next couple of months, this D2C brand aims at bringing interesting health and beauty offerings, focusing on GenZ and Millennials.

BoAt

Founded in 2016 by Aman Gupta and Sameer Mehta, BoAt has positioned itself as a lifestyle brand that deals in fashionable consumer electronics. The aim was to affordable, durable and fashionable audio products and accessories for Millennials.
BoAt’s products are available on every e-commerce platform like Amazon and Flipkart and offline stores like Croma. The company sells over 10,000 products each day and serves about 20 million users in India.

One of India’s e-commerce Soonicorns, BoAt has raised total funding of $116.3 million, notable investors being Qualcomm Ventures, InnoVen Capital and Warburg Pincus.

Recently, it filed for an Initial Public Offering (IPO) of up to Rs 2,000 crores with the market regulator SEBI. In its IPO this year, BoAt is expected to seek a valuation of $1.5-2million.

Licious

Founded in 2012 by Vivek Gupta and Abhay Hanjura, Licious is a distinct meat and seafood D2C brand. The company runs on a farm-to-fork model and provides its customers with the highest quality meat and seafood.

Spread across 17 cities, the company’s annual run rate was more than Rs 1,000 crores. Licious has delivered to more than 2 million customers, 90% being repeat customers. The company has been a torchbearer for the food-tech D2C industry, being the first in the sector to pledge ESG (environmental, societal and governance) compliance.

Licious became India’s 29th Unicorn in 2021 after raising a Series G funding of $52 million from IIFL AMC’s tech fund and Avendus FLF. And in March 2022 they raised their Series F2 funding of $150 million. The company is now valued at about $1 billion.

Country Delight

Founded in 2015, Country Delight delivers dairy, fruits and vegetables to the doorstep of the customer. It is uniquely positioned to capture the evolving consumer preference for natural, minimally processed and healthier food choices.

In the last three years, the company has grown about 10 times, served over 1.5 million customers and fulfilled around 3 million orders per month.

Country delight engages with farmers, paying a premium for their produce. It partners with low-income entrepreneurs who work part-time for delivery fulfilment. Consumers can set their daily/ alternate day subscription plans on the mobile app as per their requirements.

Country Delight has recently raised $108 million in a Series D funding round led by Venturi Partners and Temasek, raising the brand’s total financing to $147 million.

Melorra

The first-ever lightweight jewellery start-up, Melorra, was developed by Saroja Yaramilli. It’s a Bengaluru-based leading D2C brand that offers contemporary jewellery that can be worn daily from office outings to daily workwear.

Melorra delivers hallmarked gold jewellery to about 718 districts of India and more than 2,800 towns.

It is growing at 200% CAGR over the last few years and has recorded a revenue of over Rs 360 crore for the year ended March 2022. It has raised $16 million in a Series D funding round and the funds will be used to strengthen the brand marketing activities and establish more offline experience centres across the country.

Sleepy Owl

Best pals, Armaan Sood, Ashwajeet Singh and Ajay Thandi love a good coffee, but could never find a great one when needed. So, they decided to brew their own and box it in a to-go. The cold-brew coffee brand, Sleepy Owl caters to the demand for brewed and epicurean coffee across India.

Founded in 2016, the brand boasts a 75-product portfolio including cold brew packs, hot brew bags, ready-to-drink cold brew bottles and much more. The brand sources its coffee beans from Chikamagalur, Karnataka.

The company claims to have about 60,000 customers, fulfilling 800 orders per month. Sleepy Owl has raised a total of $9.56 million in funding over 4 rounds. Their latest funding was raised on Nov 22, 2021, from a Series A round led by Rukam Capital, DSG Consumer Partners and 9 others. The company is valued at $35.1 million as of Nov 2021.

Sleepy Owl continues to innovate to define how India brews up to enjoy coffee as a product.

Wakefit

Founded in 2016 by Ankit Garg and Chaitanya Ramalingegowda, this Bengaluru-based start-up offers mattresses and other sleep-related products such as pillows and comforters.

Word of mouth has been the most effective tool in the growth of Wakefit. The company does its marketing on the importance of sound sleep and health. The brand went viral in 2020 for its Sleep internship Initiative, where individuals were awarded Rs 1 lakh for 9 hours of sleep for 100 nights.

Sequoia-backed Wakefit is one of India’s E-commerce Soonicorns and it earned Rs 636 crore revenue in FY21-22. After gaining a sizable market share the company aims to cross the Rs 1,000 crore revenue target set for FY23.

The company has launched retail stores in Bengaluru, New Delhi, Ahmedabad, Chennai and Lucknow and plans to open a few more in smaller cities.

Wakefit has raised about $63 million dollars of funds till now with notable investors being Sequoia Capital, SIG and Verlinvest.

Lenskart

Founded in 2010 by Peyush Bansal, Amit Chaudhary and Sumeet Kapahi, Lenskart has transformed India’s unorganized eyewear industry. Starting as an online platform for contact lenses, the company expanded its product line to prescription and sunglasses as well.

Because of the lack of meddle-men, the company passes on the benefits of lower costs to its customers in the form of nearly 60% lower costs. Lenskart also offered its customers an online 3D facility before purchasing frames which helped customers use their trial images for better judgement.

The company recently announced tie-ups with leading online marketplaces including Nykaa, Myntra and Tata Cliq. The E-commerce Unicorn has raised $100 million in a Series-I round and it’s looking to close the current round with a $200-250 million corpus ahead of its planned IPO. The company’s valuation is expected to be $5 billion, almost double the valuation of $2.5 billion at which funds were raised.

What is D2C?

abhishekverma0109 — Thu, 07 Jul 2022 08:19:52 +0000

Direct-to-Consumer (D2C) is a model that gives companies an end-to-end control of every step in the business process. Let’s understand the evolution and the scope of this rapidly growing e-commerce business model.

The term D2C did not exist in the lexicon of the Indian business system until the last few years. If an average Indian person from any city arrived straight from 2017 to 2022, he might have a tough time understanding and recognizing many consumer habits and how the brands work today.

In the pre-internet era, the mortar stores reigned supreme for a classic Indian customer. This also led to the rise of retail chains like Lifestyle Store, Shoppers Stop, Sephora, Big Bazaar, etc. Physical retail store structure dominated the consumer market. As a brand, if you weren’t on the shelves of supermarkets with fancy labels, you would have to forget about making any penny.

Transformation in the Sector

The rise of India’s digital economy started with the advent of 4G, smartphones and nationwide internet penetration. The total number of Internet Subscribers in India have touched 834 million. There are about 931 million smartphones users in India.

The E-commerce marketplaces like Amazon, Flipkart, Nykaa, Ajio and Myntra offered easy to use platforms and enabled brands to offer a large bouquet of choices to customers across the globe. The market mutations were further aided by many logistics services providers who teamed up with e-commerce aggregators to reduce the time-to-market timelines of newly launched brands.

Beginning of a New world

Most of the D2C brands witnessed a spike in demand due to the pandemic-induced lockdowns. COVID-19, indeed, changed it all. Due to the temporary closure of retail stores and growing wariness for public spaces, consumers had to adapt to online shopping like duck to water, albeit for survival. The online e-commerce market exploded. People learned to do everything online. Teachers were teaching online, employees were working online and home-makers were ordering groceries online.

Grocery e-commerce skyrocketed in the light of pandemic. Post-COVID-19 delivery platforms like Grofers (now BlinkIt) claimed 64% of their customers switched to online shopping and 20% new customers were onboarded.

COVID-19 has accelerated D2C adoption, making it necessary for even the Fortune 500 companies to directly deal with the customers. For example, Nike reported sales from its D2C channel in 2020 at 35%, which is expected to grow to 50% till 2025. From grocery stores to lifestyle and fashion brands, everyone has been flocking to the e-commerce more than ever before.

Rise of D2C brands in India

D2C, or digital first brands, which leverage internet to sell directly, are having a dream run in India. The D2C brands are spread across segments ranging from beauty and lifestyle to electronics, pet care, fresh meat and seafood.

Brands like Sleepy Owl, Wow Skin Science, MyGlamm, Sugar Cosmetics, Country Delight, among many others, are occupying their niches and creating aspirational brands. They are crushing the market and providing extraordinary value to their respective sectors. According to statistics, the D2C market size in India can reach up to a staggering amount of $100 billion by 2025.

The D2C brands are attracting significant VC attention and investments, and are likely to continue doing so. While Licious, Mamaearth and Lenskart are the new D2C unicorns on the block, BoAt is strongly following the suit.

Direct-to-Consumer on a Boom (Pros of D2C business model)

D2C is the fastest growing E-commerce sub-sector in India. The reasons for a rise in the direct online sales are apparent.

1. Direct access to Customer Data

Understanding your customers, their preferences and how they interact with your brand and your products can enable you to-

Optimize existing products and services
Build better and more personalised offerings
Boost your marketing efforts

2. Higher profit margins

Cutting out the middlemen enables the D2C companies to reduce costs. The extra income can be used for strengthening marketing so you can reach to a larger customer base and enhancing your customer experience to build better brand loyalty.

3. Innovation is quicker and happens more often

D2C companies have to freedom to launch new offerings at a smaller scale, assess their customers’ response and make the needed developments on the real-time customer data.

This gives the D2C brands an upper hand in terms of launching new products or discovering new untapped markets.

4. Scaling is easier

The D2C business model is highly digital and allows the companies to reach their customers all over the world. The brands are able to reduce their geographical restrictions gradually and expand their operational capacities.

The D2C boom, to a large extent is driven by Tier 2-4 cities, where consumers who were well-off but starved of brands are willing to experiment with products.

5. Increased Brand Loyalty and customer engagement

Building a brand means understanding that “Customer is the King, the Queen, the Jack and the Ace”.

D2C brands are able to control everything related to branding, imagining, messaging and values. It enables them to interact, communicate and empathise with their customers and ensure the best customer experience and makes them keep coming back for more.

Emerging Trends leading to D2C Growth

The market size statistic is enough to establish the significance of D2C e-commerce. With reasonable certainty, it can be said that 2021-2030 will be the decade of D2C brands.

But what are the reasons or the trends that will lead to this extensive growth? Let’s find out!

1. Artificial Intelligence in E-commerce
One of the most significant technologies to enhance Customer Experience is AI. The reason is simple. Consumers want personalised brand recommendations.

D2C brands are making the of AI to study parameters as follows:

Customer Habits
Brand Affinity
Conversion rates
Trust build-up

2. Growing Popularity of Content Commerce

Content commerce, a fast-emerging trend in the Indian Ecommerce space has accelerated influencer marketing, social media consumption and rapid development of social commerce. Brands are being out there to create a sustainable social presence to increase visibility and customer retention.

3. Subscription Commerce on a Roll

D2C brands are adopting subscription models linked to loyalty programmes to lock in their repeat customers, while buyers get to save more. This means, creating strong connections with customers, building a loyal community and leveraging the creamy layer of shoppers.

4. Immersive Shopping Experience with new-age technology

As the world shifts towards Metaverse, trends like virtual trial rooms, customized lifestyle products, UI animation are expected to completely change the online shopping experience.

5. More Ecommerce and D2C companies heading for IPOs

Large scale funding is ruling the startup narrative nowadays. Many D2C companies in India like BoAt and Lenskart are eyeing IPOs this year. The bigger the market share and the deeper the investor confidence, more will be the chances of a successful listing.

Endnote

D2C technology has streamlined data and access to consumer purchase patterns. The customer is truly the king now with a bouquet of choices and the ever-expanding market. D2C brands who gain deep insights into customer needs and acknowledge smart implementation of technology will thrive.

Dedicated D2C e-commerce solution provider companies will assist the brands in developing full-proof infrastructures.

9 Best Abandoned cart emails

abhishekverma0109 — Tue, 17 May 2022 14:46:40 +0000

So say you are spending a million dollars in getting traffic to your website, standard CPC apparel is $2.61, and the conversion rate stands at 2%. Your CAC stands at $130. Too high?

In this case, your converted customers are,

Total traffic = 383,141
Conversion = 2%
Converted customer = 7662

Now, imagine a scenario where 6% of the total traffic is your add to cart, total lost customers (Customers who added to cart - Customers who purchased) =

Add to carts = 30,651
Customers lost = 22,989

Out of these lost customers, if 8% of lost customers, i.e. 1,839, come back and make a purchase, your CAC goes down to $105

% decrease in CAC = 19.23%
On top of this, you have also recovered your lost revenue from 1,839 customers.

This gives us a conclusion here,
Cost of abandoned cart recovery < Cost of acquiring new customers

That’s why you need to have a kick-ass abandoned cart strategy. You could initially start with a few simple emailers and then graduate to abandoned cart drip campaigns or abandoned cart journeys.

Many e-commerce players are killing it with their attention-grabbing subject lines and good copies to get their customers back.

The average open rate of an e-commerce email is approximately 15%. Emails from abandoned carts make that number laugh - it has a whopping 45% open rate 😲 (only if sent properly)

With stats like that, cart reminder emails are one of the best investments you can make. I am sharing one of the best-abandoned cart email templates I came across after I abandoned 27 carts. Do check it out! You can also find the abandoned cart email examples below.

The structure of abandoned cart emails is pretty straightforward. The basic structure is outlined below:

Subject line
Introduction text
Items left in the cart (Product images, description, and price)
Offers or discounts
Checkout button or call to action (CTA)
Ratings, reviews or social proof
Closing text

While this outline is helpful if you're only sending one abandoned cart email, you might want to consider using a drip campaign for cart recovery emails. A drip campaign is a series of automated emails.

For an abandoned cart workflow, the emails could be structured like this:

Email #1: Cart reminder (Usually sent 2 hours after cart abandonment)
Email #2: Follow up (Send 1-2 days later)
Email #3: Promotional discount (Send a few days after email #2)

Take a look at the 9 best-abandoned cart emails for inspiration and set up your own campaign.

1) Chubbies Shorts

👍: Brilliantly captured graphics, excellent copy, three links to checkout
What can you add more? Good offers, 1-2 social proof

2) Nykaa

👍: Personalisation, Graphics, copy, product information
What more can you add? Offers, social proofs (maybe they are banking on being the leading player in the market)

3) Google Store

👍: The emailer creates ‘Urgency’ with their ‘going, going, gone’ copy. It is a classic example of a Copy done the right way. Usage of the word - ‘popular’ to create FOMO

As long as you're honest, warning potential buyers that they might lose the things in their cart is a terrific approach to use the scarcity effect as a marketing strategy.

4) ThredUP

👍: Clear product pictures, slash pricing, coupon code, referral discount
What else you can do: More exciting subject line

5) Sugarbearhair

👍: CTA colour united with graphics, three checkout links, detailed cart information
What else you can add: Customer reviews, offers, a sense of urgency

6) ASOS

👍: Clear product recommendation, free delivery, easy returns, urgency
What you should add here: Include product pricing in your email and one more CTA button

7) Nordstrom

👍: Great copy, clear product pictures with title, FAQs, free shipping and returns, customer care
What else could be done: Include product pricing. You can also add
offers

8) Brooklinen

👍- Coupon code and social proof
What you should also add here - Product images, description, price and variant (if applicable)

9) Casper

👍- Great copy, one review with an option to read more reviews
What else could have been done: Product image could have been bigger with price details

There are undoubtedly other alternatives to the abandoned cart email. We suggest A/B testing different variations to see what works for your audience. Do they prefer emails that are personalised? Or Discounts? A interesting text? Or maybe a combination of all. It's important for you to find out.

If you feel there's more to it, comment on the blog or reach out to me at abhishek@getconsole.io, and I'll share it with our community of D2C brands. Cheers!