💅 Acquisition project | Nykaa Man
💅

Acquisition project | Nykaa Man


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Nykaa has seen a 29% YoY growth. Beauty and personal care (BPC) has touched 25%, Fashion 40% and Superstore (B2B) about 39%. That translates to a ₹36,000 Mn GMV YoY and and approximate profit of ₹7607 cr YoY. Their PAT was ₹175 Mn, with a hefty 106% YoY growth as of Q3 2024. They also have a "mens" section on the Nykaa app.

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So, why is Nykaa Man required?

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Problem statement:

There is no marketplace that assigns trust to buying Men's products. It's unorganised, has availability issues, lack of choices, no open chatter or premiumness attached to it.

Problems out of these that matter to our consumer: Availability, lack of choices, premiumness.

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​Some context:

Launched in 2019, Nykaa Man currently has a GMV of ₹237 crore (39% of vertical growth), net sales of ₹130 crore and contribute 7% to Nykaa's overarching business.

To understand the market opportunity, the market size for just men's grooming and upkeep was ₹12,500 cr in 2021, and is projected to increase to ₹19,500 cr by 2026.

Our shoppers are 25-34 y/o.

App downloads: 5M+ (android)

Amazon, quick commerce and/or offline stores are our major competitors.

source


​Pain points for our users for online shopping: ​

  • No reliability, the product bought might be a hit or miss with quality
  • No proper reviews or credibility found
  • Unavailability of products, have to wait for a restock
  • Confusion on gifting female counterparts/male friends and family
  • Intent to experiment, but no nudges given

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Why Nykaa can't fulfill what Nykaa Man does, lies in the difference of usage by the two's TAs. Some user insights:

  1. Convinience & ease > Availability > Structure and stability > Pricing > Discounts and grand sales
  2.   Product, utility, value for money > brand or endorsements
  3.    Health products > luxury purchases > skin and beard care > hair care
  4. Sport and health products have more usage, experimentation and repeat purchases than grooming/skincare. Haircare falls last, considering AOV of all.
  5. While grooming is a private affair, skincare purchases have a female influence.
  6. Amazon and quick commerce tops the chart for repeat purchases.
  7. Once they like a brand, they trust it and become habituated for years.
  8. Purchases happen once a month and only when the product is finishing (NOT during sales, special discounts), so availability is crucial.
  9.   Perfumes, electronics, watches and luxury fashion is gifted and received as gifts
  10. They depend on online reviews only and don;t discuss purchases offline with friends/family/peers.
  11. Rewards, female counterparts and starter or trial packs can nudge them to experiment with new brands or product lines
  12. Nykaa Men is not just used by men, it’s used by men for women, by women for men, and by women for themselves.
  13. Some winning personality traits in all men are being intellectual, wise, funny and existential.
  14. They depend on utility first apps and prefer to pay extra for convinience.

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Nykaa Man delivers all points highlighted in green, so it has obtained PMF and witnesses repeat purchases once a trial is done.

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The AOV on Nykaa is ₹6400 - ₹9000. Numbers on Nykaa Man specifically were not available. However, top purchases were on premium brands like adidas, Nike, Marks and Spencers. Our TA too picks luxury purchases in that bracket, so willingness to pay is present.

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skin+hair care male shoppers

Online male health+luxury shoppers

Females who gift

Female shoppers

% of users

20%

40%

30%

10%

Intent to use Nykaa Man

Low

Low

Low

Medium

Purchase behaviour

  • last minute
  • product search and checkout
  • buys grooming, health and luxe products
  • looks at reviews to decide

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  • window shoppers and experimenters
  • always on the lookout for better products+brands
  • ok to spend more for quality
  • looks at reviews to decide
  • Nykaa loyalists
  • Premium shoppers
  • surf for the perfect purchase
  • look for value for money
  • want to give a group of products over single ones
  • looking for a good deal
  • nudging a male counterpart to purchase
  • gifting a male counterpart
  • scoring discounts

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Age

25-35

25-35

21-27

21-35

Gender

Male

Male

Female

Female

City

Tier I & II

Tier I & II

Tier I & II

Tier I & II

Marital status

Unmarried

Unmarried

Unmarried/Married

Unmarried/Married

Job

Mid level managers

Mid to senior level managers

Mid to senior level managers

Mid level manager

Salary/month

₹80K - ₹2L

₹2L - ₹5L

₹2L-₹5L

₹80K - ₹2L

Options against Nykaa

Amazon, Blinkit, Swiggy Instamart

Amazon, Blinkit, Swiggy Instamart

Myntra, Ajio, Urbanic, offline retail, malls, Tiraa, Purplle, Tata Cliq

Tiraa, Purplle, Tata Cliq, retail, beauty stores, malls

App preferences

YouTube, Spotify, Twitter, LinkedIn, Gmail

YouTube, Spotify, Twitter, LinkedIn, Gmail

Nykaa, Spotify, Whatsapp, Instagram, Myntra, YouTube

YouTube, Spotify, WhatsApp, Instagram, Myntra, Nykaa, Amazon Music

Where do they spend money?

Electronics, health products, perfumes, shoes, daily grooming essentials

Premium subscriptions, gym memberships, Utility based apps

Beauty & personal care, Fashion, subscriptions, gym memberships, hair care

Beauty & personal care, fashion, hair care, food, gym memberships, home accessories, gifting

Where do they spend time?

Workplace, gyms, turfs, YouTube, Twitter

Gyms, Sports, Upskilling, Workplace, Luxe restaurants

workplaces, social media, restaurants & cafes, online shopping,live experiences, commuting

workplace, social media, cafes, commuting, online shopping, commuting, outings

AOV/ year

₹3500-₹4000

₹9000-₹15000

₹9000-₹25000

₹9000-₹15000

Trust on Nykaa

Low

Low

High

High

Frequency of purchase

once in two months

Once a month

Once a quarter

once a month

Decision making parameters

Convinience, value for money, trust

best option within budget, up and coming health products, excellent experiences, thoughtful curations

best value for money, ongoing trends of the season, newness to product, premiumness

hunt for best finds, premiumness, discounts and sales, experimentation with new brands

Pain points

Products unavailable, reviews unavailable, no nudge but willingness to experiment, no info on luxe options

Low trust, low options, less reviews available, no recommendations or inner circle info, confusion on gifting

Unclear on best gift options, Unclear on usage, Low trust on niche/unknown brands

high prices, bad customer service, sizing issue in clothes, poor return policy

Solutions

Transparency, Extensive review system, trial packs, starter kits, education on luxury items

Build trust via outside inference, extensive review system, trial packs, curated gift options

a guide to gifting, a playbook on men's upkeep, testers for homegrown/luxe brands

discounts and sales, better TAT for customer complaints, more product info, transparency in returns

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User Research

ICP Selected:

  • Online male shoppers for health, fitness and luxury items
  • Online female shoppers who gift males (secondary)

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Product Overview

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The app banners correlate to our user insights, i.e., luxury, health and nutrition are more popular purchases causing maximum stickiness. It also corroborates with Nykaa's growth pillars:

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  • Premiumization: Luxe store and banners up front
  • Personalisation: custom notifications and banner refreshal post surfing
  • Curation: Products by concern
  • Content: Editor's Picks
  • Convinience: Quick widgets on the home page

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What's the market opportunity?*


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Consumer Pool

Calculation

Overall Size

TAM

Male

Online shopper

Market size of health supplements in males

Market size of luxury purchases in males

AOV/year * Frequency of purchase * No. of online shoppers in India who are male (50% of population)

₹10000 * 1 * (50% of 230 million) = 115 billion rupees = ₹11500 crores

SAM

Male online shoppers willing to shop on Nykaa, or have already

AOV/year * frequency of purchase * No. of male shoppers on Nykaa

₹10000 * 1 * (5.2% of 18mn Nykaa shoppers is men) = 9360 million = ₹936 crores

SOM

Male online shoppers that will use Nykaa Man as per their core value prop

% of SAM aged < 35 * Nykaa Man's market share**

(40% * 936) * 5% = ₹18.7 cr

*indicative numbers

**based on Nykaa Man's position on SERP, app store and top of mind awareness.

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What's the edge we bring?

Nykaa Man's Core Value Prop: ​

The right hand to every gentleman in their path to being the best they can be. With convinience as the backbone, a comprehensive list of homegrown and international brands, curated options and premium gifting, Nykaa Man aims to be every sophisticated man's go-to health, grooming and luxury one-stop-shop solution.


Why we have an upper hand—

Eliminating grooming, the core decision maker for fitness, health, perfumes, shoes and accessories are not just the men, but also their female counterparts. They rely heavily on their recommendations and only speak to them, not their male peers.

The best part?

These are all Nykaa loyalists.

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Channel Selections


Channel

Cost

Flexibility

Effort

Lead time

Scale

Referral

Medium

High

Low

Medium

High

Partner program

Low

Medium

High

Low

Medium

Organic search (SEO)

Low

High

Medium

Medium

High

Content loop

High

Low

High

High

High

Paid marketing

High

High

High

Medium

Medium

Product Hunt

Low

Low

Low

Low

Low

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Channels in green will be selected for acquisition. Reasoning given below.

Jobs to be done—

To redefine Nykaa Man as the go-to destination for health and gifting

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Organic Search (SEO)

Core Insight: The decision making for men's purchases is very straightforward, with trust put on other buyers and not their inner circle, family, friends or partner.

The decision framework for most users interviewed involved the following steps (for health, fitness, gifting perfumes particularly):

1. Google their product/ Already know the product (not brand)

2. Has a brand affinity = googles the brand or looks at e-commerce

3. Looks at Amazon, which comes first in SERP.

4. Gets redirected to app (if they have it)

5. Searches the product in the search bar

6. Looks for reviews to evaluate

7. Purchase occurs

8. Repeats purchase when product is about to finish from Amazon directly (irrespective of discounts, sales, special bundling, offers, etc).

9. If product's unavailable, checks back again the next day on the same site or e-commerce apps.

10. If unavailable both places, waits for a day to check again (loyalty erupts here).

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Pillars for purchasing:

• Convienience

• Availability

• Ease of check out

If Nykaa Man captures the most sought after keywords on Google search, they can capture the same market via convinience (availability and ease of check out is a product USP), since loyalty is present for the product or brand, not marketplace.

Some searches that have stood out:

image.png

Sample headlines, meta descriptions and meta tags for Organic searches:

Headlines:

Nykaa Man: Buy health products and supplements online

Nykaa Man: Buy gym supplements online

Nykaa Man: Best options on protein powders

Nykaa Man: Buy protein powder at best prices

Nykaa Man: Buy luxury perfumes for men

Nykaa Man: Get long lasting perfumes on sale

Nykaa Man: Buy best selling perfumes online

Nykaa Man: Buy our top selling Eau De Parfums

Meta tags:

protein powder men, protein powder, whey isolate, muscle blaze, ON whey protein, gym supplements, gym products, Nykaa Man coupons, Nykaa Man whey powder, gym products, Protein shakes, luxury perfumes, long lasting perfume, perfume for men, gifts for men, best selling perfumes

Meta description:

1. Get gym ready with the best whey protein options and other health supplements on Nykaa Man.

2. Satisfy all your protein needs on Nykaa Man. Stock up now.

3. Stock up on your health essentials in one go at Nykaa Man. Shop now.

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To tweak Nykaa Man as per how a man shops, and his needs

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Partner Program

Core insight: Men have extreme loyalty to a brand after a positive experience, which lasts for years. They also purchase as and when they finish for health products and experiment with trends.

How can we enable our users to do this seamlessly on Nykaa Man?

By automating the purchase process for them. ​

Consider you finish your whey protein in 30 days, which you bought from Nykaa Man.

​• Post your first purchase and successful delivery, it gives you an option to set a reminder for re-purchasing, where the time frame is set by you.

• After your set time frame, Nykaa communicates a reminder to re-purchase on WhatsApp, push notification, and an email (like a bill due date).

• It takes you to the product you last ordered and also gives suggestions below in a carousel including competitors and most bought along with the primary product.

• Once you re-purchase, it confirms your delivery, as well as timer set.

• The timer comes with the upper hand: a surprise trial product added from skin or face care from Nykaa Naturals, Nykaa SKINRX or Nykaa Perfumery (AOV for trial products gifted by Nykaa is ₹1600-₹2500, whereas AOV here is ₹2500-₹10000). This free gift would expire once the timer ends.

image.png​

Where do partners come in?

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Nykaa prides itself on its partner network, with 3400+ brands onboarded with an aim to address a larger TAM across the value chain as part of their growth strategy.

These partners in health include: Optimum Nutrition, Muscle Blaze, HK Vitals, Cosmix, Man Matters, The Whole Truth, Bombay Shaving Co., InLife, MuscleTech, Nutrabay, Oziva, Plix, Setu, Wellbeing Nutrition and many more.

By championing bestsellers through regularly confirmed purchases, partner programs with these brands can be created by giving advertising spaces within Nykaa Man to push for the ones not organically searched for.​

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To make our users experiment via women

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Referral

Core Insight: Most product adoption for men-only products happens via observing male seniors or personal learning. Unisex products such as skincare, lifestyle, personal care and luxury purchases are recommendations pouring in from female counterparts. These include sisters, mothers, female friends, colleagues, partners etc. While grooming is a private affair, the rest is dependent on women in a man's life.

Tons of women (18mn users as of Q2 2024, 50x visits per customer per year) prefer Nykaa over others because of:

• New product discovery

• Heavy discounts

• Membership that reaps long term rewards, which include free gifts from Nykaa (Prive, Luxe, etc)

• They feel that a package is equivalent to a gift (thanks to packaging and experience)


Nykaa's edge is making these purchases double up as a gift to yourself, even if you've paid for it. The best part of the experience is waiting for them to arrive and then unboxing. Dopamine is Nykaa's platform currency, obtained after a successfull delivery felt after unboxing their "gift".

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Opportunity gap: Utilising this behaviour during a gifting purchase.

Presenting: You got a gift!

For a girl/woman, we know what out brother wants, but a return gift is basic expectation.

Enter: Nykaa's gifting programme

A referral programme where you, a Nykaa user,

Refer someone to Nykaa Man → Nykaa's referral will be a gift kit → Referred person redeems the kit and your referrer gets cashback of the same amount gifted to her Nykaa account

Customer Journey Flow: ​

Nykaa's repeat user does a purchase

↓

Order gets deliveried on time in the desired condition

↓

User gives a 4/5 rating

↓

User gets an in-app pop up to join the "Gift and Earn"

↓

User clicks pop up

↓

Lands on the referral progamme page in-app

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Copy: Refer your friends and family to Nykaa Man and earn double the amount they shop on their first purchase!

CTA: Pick a gift now.

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User clicks CTA, gets redirected to three starter kits to pick from, Small, Medium and Large, priced ₹499, ₹799, ₹1299

CTA on each: Refer this

↓

User picks one, gets a link that can be shared on WhatsApp to most messaged users, followed by Messages (SMS), Mail and Copy Link

Copy on message generated:

image.png​

↓

Referred person clicks the CTA, lands on the Nykaa Man website+ gets the 3 kit options to buy from (at a 50% discount from the original prices).

Copy:

Headline:

Welcome to the Nykaa Fam!

Anushka gifted you a 50% discount to start with your self-care journey.

Byline:

Nykaa Man aims to make every man the best they can be, whether thats through grooming, being fitter, caring about yourself or pampering yourself luxuriously.

CTA to claim: Claim your gift now.

↓

User purchases, referrer gets double the amount credited to their Nykaa account as a coupon (for eg, If I picked the ₹499 option, the referred user pays ₹249.5 and I get ₹499 as a coupon).


Tracking Referrals: ​

All referrals sent would be tracked inside the app of the referrer, in the referral section.

A milestones tracker would be created to show their path to being a power referrer.

Member → 1st Referral ----→ Gold Referrer ----------→ Platinum Referrer

<₹XX coupons collected> | View History

Each referral history would have:

• Days since it was sent

• Used/Unused by referred mentioned

• If Used,

• Coupon generated for referrer with the name of the reffered. For eg, "NykaaManRahul", with the validity present for a month.

• If unused,

• Coupon generated for referrer with the name of the reffered. For eg, "NykaaManRahul", but blocked for usage.

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Identifying and championing power referrers: ​

Power referrer: Any Nykaa user who has referred and obtained 10 or more coupons via referrals in a period of 3 months, or 15 or more coupons in a period of 6 months.

Perks once you're a power referrer (given in the layout of the referral program section)

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A jump to becoming a Nykaa Gold/Platinum user and the same benefits, depending on where they stand.

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Free shipping, Exclusive sales, birthday gifts, access to masterclasses, 1.5x rewards.

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