Today, more than ~250 million online shoppers are behind a cumulative annual spend of over $100 billion in India, spread across various consumer segments. Commerce is rampant, malls are overflowing, marketplaces are buzzing, quick commerce is almost too quick, and delivery channels in tier-1 cities are a flourishing ecosystem. Economics from first mile to last mile, including dark stores, appears to be working - but why? Because we’re spending. Specifically two critical generations: (1) The millennials that embraced the internet’s baby steps and (2) The Gen Z that saw it run a marathon.
What aspect of our daily life transcends the differences across generations? The obsession with self: Where we live, what we eat, what we wear….and what we look like.
Beauty and Personal Care (BPC) has always been a core sub segment under FMCG, accounting for nearly 50% of it. Over the years, it has emerged as a high-affinity, high-conversion category where there’s a product for everyone, be it under INR 10 or be it in the thousands. For every strata of the society exists an ecosystem of localized products and services, attached deeply with societal festivities, personal achievements, and beyond. While the older generation resonates to “multani mitti”, the 90s kids would remember the constant “Nima Sandal” ads, or even shelves occupied with Shahnaz Husain products. Earlier consumption of product along with content used to nudge customers into repeat purchases, but today, content comes first before purchase of products. Many micro ecosystems have blossomed as a result, for example, travel vloggers promote tourism, make-up artists give even the cosmetics industry its X factor, choice of clothing by an influencer dictates fashion trends, and much more. The definition of self-care has evolved but it has had a dark history.
India’s unfair obsession with light skin
India’s obsession with light skin has an infamous history and is deeply rooted in the nation’s psyche. The fair skin phenomenon is reminiscent of the colonial era - such is the root of the problem, that anything white is good and sought after.
Naturally, where there was demand for fairer skin, there was a supply for it. In 1975, Hindustan Unilever launched Fair & Lovely. Post 1991, a flurry of brands decided to capitalize.
It started with Emami Fairness Cream in the early 90s, CavinKare's Fairever in 1998 and Godrej's FairGlow in 1999. Fast forward to today, nearly 50 years since the launch of Fair & Lovely, fairness creams still account for 25% of the overall skincare market.
Changing attitudes - GenZs leading the way
Credit to the new age shoppers, their lifestyle preferences, choices, and morals hold significant value. GenZ and Millennials prefer ethically sourced, non-toxic, and sustainable products - from ingredients to packaging (For example, ‘paraben-free’ and ‘cruelty free’ narrative of MamaEarth in its early days led to widespread adoption). But most importantly, there is a strong demand for inclusivity - a level playing field for all, where there is no tolerance for any kind of discrimination.
Based on these fundamentals came the backlash of brands promoting fair and white skin. Upon major criticism, in 2020, HUL rebranded Fair & Lovely into Glow & Lovely removing “fair/fairness”, “white/whitening”, and “light/lightening” from its brand packaging. The backlash has since caused a 3% decline in fairness creams overall, a trend which is likely to continue.
Introducing Asaya:
Asaya (meaning: of god’s creation) is a beauty and personal care company building skincare solutions for melanin-rich skin. Melanin is defined as a dark brown pigment (= substance that gives color), found in eyes, skin, hair, etc. It helps to protect the skin against harmful light from the sun.
Asaya is catering to the largely ignored and unmet demands of the real Indian consumer. For years the market for skincare products has been dominated by products that cater to ‘Caucasian’ skin. Melanated skin has its own unique challenges, such as hyperpigmentation, sebum concentration, reduced skin hydration, and even chronic conditions like Vitiligo and Psoriasis. Melanin-skin also ages very differently to other types of skin, making generalized anti-ageing products in the market irrelevant.
Positioned as a mid-premium and scientifically backed brand, Asaya is creating a slew of products that tackle these core sets of problems through a 4-step regime: Clean, Hydrate, Treat, and Protect. These categories further segment into 5 foundational categories: Daily Hydration, Sun Protection, Radiance, Depigmentation, and Age Defying. Asaya’s range of products have been dermatologically tested and scientifically validated.
The BPC market is resilient and ripe for growth
India’s beauty and personal care (BPC) market is projected to touch $30 billion by 2027, accounting for about 5% of the global market. While BPC spending per capita is a mere $14 in India, as compared to $38 in China and $313 in the US, BPC is the highest growing consumption category across all other major consumer categories. The Indian BPC market also has the highest projected CAGR against other emerging countries.
Brands focused solely on pure-play beauty and personal care have disrupted the market by targeting specific use-cases, leading to higher growth rates, gross margins, and profitability compared to FMCG-led BPC players. For example:: Pilgrim, Juicy Chemistry, Nat Habit, Earth Rhythm, Deconstruct, and more.
85% of Indians have melanin rich skin. Typically skincare in India has not adapted to melanin-skin and is often the same formulations designed for the world. There is documented evidence of melanin-rich skin having chronic skin issues and their high vulnerability to hyperpigmentation, vitiligo, and age-ing.
The hypothesis for melanin-rich skin brands to excel is starting to gain momentum globally.
- Popular tennis star Naomi Osaka launched Kinlo which focuses on providing products to protect darker skin individuals from the sun.
- French-based melanin-rich skin and research brand 4.5.6 skin is doubling down on skin-type research and curated products for melanin-rich skin.
- Many other emerging trends globally include: K-Beauty, Clean Beauty, Gender-Neutral Skincare, etc.
The opportunity for melanin-rich and brown-skin focused brands emerges as a result of changing the underlying narrative and obsession behind whiter, fairer skin. Skin-lightening brands still constitute a large part of the market share, however, amidst heightened consumer awareness and shifting values, there emerges a space for brands to create quality products for melanin-rich skin.
The Team:
Behind Asaya is a stellar set of entrepreneurs who have been there, done that. The group includes Neeraj Biyani (Ex Co-Founder at Paper Boat Beverages), Eeti Sharma (Ex VP at Genpact), Mandeep Bhatia (Ex Founding team member at Paper Boat).
Our interactions with the team over the past few months have been refreshing. In a market that has a plethora of options at various price points, for us it’s about identification of true problem statements and the forward looking journey of executing on the defined plan — clarity that the team has possessed since Day 1.
Experience in consumer markets always leads to an edge in execution. Even at Paper Boat, their business was met with similar considerations of high competition from legacy businesses, which they were able to overcome through a playbook consisting of a unique marketing strategy built on storytelling, a refreshing SKU mix and manufacturing capability of high-quality products. Similar considerations are present for the team in skincare through Asaya, which, albeit is a different challenge, but one that the team is seasoned and equipped to handle.
Fast Forward to 2030:
We anticipate that evolving beauty and personal care standards will significantly influence the Indian market. What are currently seen as consumer trends will soon become ingrained habits. In this context, Asaya is pioneering a (sub) category focused on melanin-rich skin, which may seem niche today but is expected to become mainstream in the future. Innovation will be crucial, not only in product formulation but also in form factor and packaging, with the latter playing a significant role in brand recognition. Brand recognition will thus result from a combination of high-quality products that customers love and effective consumer education, driven by compelling and consistent storytelling through content creation and delivery. At Huddle Ventures, we believe Asaya is a well-oiled engine equipped to handle the weight of its ambitions.
