The main focus on Myntra has always been apparel. Like its parent company Myntra is rooting for private labels to boost its performance, instead of discounts. The etailer has also formed partnerships with private fashion brands to support this strategy. But, it appears that focus may change on the fashion platform from wearable items to personal care and beauty products.
Private labels for the new category
Just nine months ago, Myntra launched its beauty and personal care segment. Now, it is aiming for $100-150 million from this category by March 2019. The online fashion etailer is speaking with private labels which it plans to launch in the next six months.
Myntra chief executive, Ananth Narayanan said, “Our focus in terms of the brands we have tied up with has been premium and mass premium. We will launch a private label in the categories where we see a gap to bridge in terms of pricing for the mass segment.”
These will include:
- Colour cosmetics for lips, eyes, nails
- Fragrances and deodorants for men and women in the lower end segment
Narayanan also mentioned that the portal will introduce grooming products for men, which makes up one-fourth of the revenue earned by the personal care segment.
Bindu Mendonca, senior VP, women and emerging business at Myntra said, “Personal care and beauty are strong brand play, while colour and lower-end fragrance is something users are willing to experiment with.”
Experts believe that private labels in this category can bring the online retailer margins up to 35% while the other products will rake in 15% at best.
Myntra’s expansion strategy
Myntra is already at the forefront of online fashion retail. With an additional category that’s hot in the online retail market, the ecommerce company plans to increase its user engagement on the app.
Data shared by Myntra shows that for personal care the average basket size of a shopper on the site is one and a half times that of the average. The beauty and care market is worth approximately $150 million and will grow 100% in the next two years, based on the overall online market.
According to Narayanan, “The frequency of business in the category is higher than apparel and it is unit economics profitable. We are willing to invest big in the category over the next five years.”
To ensure the success of this category, Myntra has built visualisation tools in the colour segment and will allow new product sampling for customers who buy apparel from it.
Shubham Anand, head, retail and consumer packaged goods, RedSeer Consulting, pointed out that, “Speciality retailers (such as Nykaa and Purplle) have a good hold in this category. High margins and scope of growth will be in the luxury and super-premium category , though user behaviour to buy these products online will take time to mature.”
Does Myntra stand a chance at diversifying significantly? Or, will it lose to competitors?