Acquisition project | Scentira.in

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Acquisition project | Scentira.in

WHAT IS SCENTIRA?


What is it?	Scentira is a perfume marketplace for luxury & semi luxury perfumes, offering 500+ scents from global brands in flexible sizes.
Founded	April 2024
Channels	D2C / Website
Stage	Product Market Fit
Value Proposition	Flexible Sizes - Offers perfumes in 5ml, 10ml & full retail pack sizes Access - To a wide catalogue of perfumes under one roof. From designer brands to niche brands that were once only available in exclusive boutiques or duty free stores.

Elevator Pitch

Hi, I am Lovish, founder of SCENTIRA. Have you ever had a perfume sitting on your shelf because you didn't like it after buying it ?

Imagine if you could try luxury perfumes for a month before paying the full price.

At Scentira we offer 500+ designer & niche perfumes from all global brands in 5ml & 10ml sizes so that you can try all you want before buying a full bottle. 2/3rds of our customers have now switched entirely from buying full bottles.

PROBLEMS IN FRAGRANCE MARKET (INDIA)

During my research & talking to people before starting up, these were the problems identified

There is no Indian brand above 3000 price range in perfumes that has an aspiration level like foreign designer brands lik Gucci, Chanel etc
India is seeing a growing demand of Inspired Perfume brands which validates that people have high aspiration but affordability is an issue. Hence people resort to "Inspired Perfumes"

AT CONSUMER LEVEL

Problem	Explaination
Trust Deficit	Perfume market is filled with dupes & counterfeit products. Hence people dont trust new brands easily and resort to popular stores like PARCOS, SEPHORA etc
Access	Stores like SEPHORA / SHOPPERS STOP / PARCOS only house 20-25 brands. Which makes the choice limited to new perfumes. As a result they postpone their shopping decision to when travelling abroad or resort to options available
Lack of Knowledge	There's not enough educational content like SKINCARE industry to educate people on what perfume to buy. There are nuances in fragrances just like skincare which people dont know about, hence their decision making is often uninformed.
Unavailability of Stores in Tier 2 Cities	Tier 2 cities like Indore, Ahemdabad, Jaipur, Lucknow etc don't have big perfume stores. But the audience has aspiration & disposable income. We feel that this market is untapped.
Inability to Try	Perfumes being an olfactory experience needs trials before someone makes a decision. But at stores 'NOSE BLINDNESS' occurs after 3-4 perfumes. Moreover perfumes change after sometime which is impossible to judge in that 15-20 minute window of trials. This sometime leads to buying a wrong perfume and then regretting that purchase.

AT INDUSTRY LEVEL

Problem	Explaination
Supply Chain	Perfumes across world are not sold by brands themselves. Rather distributors liek Estee Lauder / L'Oreal have appointed offfical stockists in India. But there's grey market that sells them as well because of which many websites sell perfumes at a discounted rate. This price parity further contributes to trust deficit.
Lack of Online Brand	There is no single retailer online that houses all perfume brands which also has trust in the market. Myntra/Nykaa/Tira have designer brands only and a few niche brands. Amazon is known to have fakes because difficult to verify seller

WHAT IS OUR SOLUTION ?

FOR CONSUMERS

Solution	Explanation
Unique Packaging (Con	By packaging perfumes in 5ml & 10ml sizes, it makes it easier for people to try perfumes at the comfort of home and then making a decision to upgrade to a full bottle.
Building Trust	Since there is trust deficit in the industry. Allowing people to buy mini versions of perfumes before buying a full bottle makes it easier to trust a new brand By making infotainment content, we can build a trustworthy brand
Access to 500+ perfumes under one roof	By having perfumes from budget to luxury range, we allow people to explore a variety of perfumes under one roof.

FOR PERFUME BRANDS

Solution	Explanation
Access to Newer Markets for established brands	Currently big brands sell via offline channels in mostly Tier 1 cities And online retailers like Myntra, Nykaa only sell full bottles which is a deterrent for consumers to buy a perfume they haven't tried
Access to new consumers for newer brands	Brands that are new struggle for shelf space in stores like Sephora / Parcos etc. This makes it difficult for people to try new perfumes thus affecting new brand's adoption & growth

USER RESEARCH

Spoke to 10+ users who have bought & used the product for more than a month. 80% of users are male aged between 21-30 (with some being 40+ Men). When asked why they bought the product, the answer is unanimous that they wanted to try new perfumes and this allowed them to do that. Also many people dont want to buy full bottles because they want to switch their perfume after some time. Users like to wear different perfumes at different occassions.

The one issue that most face is to trust new websites as they fear getting a duplicate product. So all of them came via reddit which is our primary channel till now. As there WOM spreads faster & people trust the community's word. Most users wear perfume daily, having a budget option as a daily driver & some special ones for special occassions.

Men aged 35-40+ usually wear luxury perfumes but often buy in store or mostly at airports while travelling.

ICPs

Criteria	User 1	User 2	User 3
Name	College Student	Early Working Professional	Seasoned Working Professional
Age	18-24	24-30	30-45
Demographics	Tier 1 Cities	Tier 1 Metros	Tier 1 & Tier 2
Gender	Any	Any	Male
Relationship status	Single/Dating	Any	Any
Need	High	High	Medium
Pain Point	Lack of budget friendly perfumes that meet aspiration & quality standards	Wants to experiment with new perfumes Wants to try niche brands	Trust deficit with online players
Solution Awareness	High	Medium	Low
Current Solution	Opting brands that make inspired perfumes Middle Eastern Brands	Resorts to buying only limited brands available offline Sticks to few known brands	Buys at offline retailers or waits to travel abroad & buy there
Price Sensitivity	High	Medium	Low
Income level	15-20k per month	80k-2lakh per month	40LPA +
Marketing Pitch	100% authentic Luxury perfumes without paying full price	Try from 500+ luxury perfumes before you buy a full bottle	Your trusted sel
Reasons of buying Perfumes	Standout among peers	Create impression among peers Enjoy the experience of wearing perfumes for self	Part of daily routine Switched from Deo with upwards economic mobility in life
Frequency of use case	Daily	Daily	3-4 times a week
Average Spend on the product	3-5k year	8-12k year	15k+ year
Where do they spend time	Mostly on social media - IG, YT, Snapchat. OTT paltforms. EdTech paltforms for upskilling, Zomato, Swiggy, Quick Commerce	Social Media, OTT, Shopping Apps like Amazon, Myntra, Nykka, Travelling, Cafes, Bars, Family	OTT, Family, Going Out, Travelling,

we have multiple users of a product and not all of them can be our ICP for whom we make our strategies, we need to prioritize.
(use this ICP prioritization table)

Criteria	College Student	Early Working Professional	Seasoned Working Professional
Adoption Curve	High	High	Low
Appetite to Pay	Low	High	High
Frequency of Use Case	Medium	High	High
Distribution Potential	High	High	Low
TAM

So based on the prioritisation metrics we will priotiise the folliowing ICPs

ICP1: College Students
- They are most active on social media & are easier to acquire as early users and get feedback.
- Their aspiration is high & affordability is low & current products are only solving for affordability with sub standard quality like BELLAVITA etc
ICP2: Early Working Professionals
- This ICP has good disposable income & wants to stand out amongst peers.
- They are already wearing perfumes and keep experimenting with newer ones with 1-2 as safe staples.
- They are easier to reach via digital channels & will also trust new D2C brand in this trust deficit space

MARKET SIZING

TAM

Perfume market size in India is roughly ~$500m (statista report)
Out of which luxury market accounts for 45%, which is our use case
Hence TAM for SCENTIRA is $225m

SAM

SAM here is limited by the following factors
- Income Level - That is already taken into account when we have only taken luxury perfume purchase in TAM calculations
- Distribution - Online vs Offline

As per a 2022 report ~75% perfumes are purchased offline. Since Scentira is only available online as of now the SAM is

75% x 225 mn = 56.25 mn

SOM

Taking an assumption of 5% market share because of the lower price point, unique packaging
SOM for SCENTIRA would be ~ 3 mn

POINTS TO CONSIDER

These calculations are only based on luxury perfume segment, but as of now SCENTIRA has a portfolio of mid luxury & mass premium perfumes also. Which increases the TAM
The price point is comaprable to the mid luxury perfumes which means that with higher aspiration there MAY be transfer of users from one category to another. As this could act as a bridge.

Understand Competitors

Factors	Tata Cliq / Myntra etc	Splash Fragrance	Inspired Perfumes (House of EM5 / XLNC Perfumery)
What kind of perfume catalogue do they have	Known brand perfumes & some niche brands	Any and all brands possible	They sell perfumes made by themselves claiming they smell similar to OG perfumes
What are the USPs	Brand Trust, Offers	Trust among perfume community online Availability of widest perfume catalogue in India Strong SEO	Price factor - Attractive price for new user with high aspiration Riding on famous perfumes' popularity
What channels do they use?	Online / Offline	Online	Online D2C
What pricing model do they operate on?	Mostly selling on MRP & occassional discounts	Selling on MRP & Offering mini versions like us	Under 1000 rs category
How have they raised funding?	MNCs	Bootstrapped	n/a
What is your product’s Right to Win?	We offer mini/travel sized packing of same perfumes allowing access to same consumers with a differentiated offering	They don't do any paid media or active marketing and rely solely on WOM & referrals. So we can capitalise on paid media and acquire users faster. Their web UX is not trust inducing and is a deterrent for new users to trust them, in a trust deficit market.	By busting the myth that there's a reason why expensive perfumes are pricey & why these brands cant offer quality or even similar perfume Offering an alternate to this audience at a similar price point with the real perfumes instead of dupes
What can you learn from them?	Brandind	SEO & WOM	Paid Ad Campaigns

ACQUISITON CHANNELS

Channel Name	Cost	Flexibility	Effort	Speed	Scale	Budget Needed
Micro Niche Communities on Facebook / Reddit / Whatsapp	Low	High	Medium	Low	Low	Low
Paid Ads	High	High	High	High	High	Medium

Quick Commerce 💥

Though not a primary channel in PMF stage, quick commerce is a great channel because of the form factor & price point. It can help tap impulse demand (as perfumes are often an impulse purchase), and also help QC businesses to increase their AOVs.

Detailing Acquisition Channel

Since our product requires education & awarenesss tapping into niche communities of perfume enthusiasts is a good place to start as they are already aware of the problem & regularly buy perfumes.
We used Reddit in the first month and acquired 100 customers in the first month without any CAC
- eg 'DESI FRAGRANCE ADDICTS' on reddit has 4lakh plus members and just one 2-3 posts in a month helped acquire 100 users
Paid Ads is a good medium as our product is eye catchy and can create impulsive purchase. It will also help us spread awareness faster.
Our ICP1 & 2 both spend a lot of time on Social Media so this is logical channel for us to explore in PMF stage.

Organic Channel : SEO

SEO is something we are focusing on from day 1, as perfumes as a category is big on google search. Unlike most D2C brands we don't have to list ourselves on Amazon as luxury perfume by nature is searched on google instead of Amazon.

Since luxury perfumes already have a high buying intent, SEO is a strong organic channel which we are building upon but will of-course show results in the long run.

Type of Search	Keyword	Search Volume (Monthly)	KD	Avg CPC	Explanation
Use Case	Perfume Samples	1900	Low	13.39	There are multiple use cases like samples, travel sized, mini perfumes, pocket perfume etc that have low to medium search volume and low KD Generic use case keywords like 'Best Perfumes for XYZ' have high search volume & moderate to high KD which will take time to rank for Our primary focus should be to rank on niche & specific use case keywords to have good conversion rate & slowly build for different use cases like GYM Perfumes, Chocolate Perfumes (notes based), Occassion based perfumes (eg weddings) etc
Luxury Perfume	8100	Medium	7.53
Perfume for Men	246000	Medium	5.86
Competitor	Splash Fragrance	9900	High	36	All our competitors have moderate to high branded search keyword volume. Meaning that people once trust a perfume website, are loyal due to trust deficit already in the market. Difficult to rank for their branded keywords but can be beaten on other fronts like PERFUME COLLECTION/BRAND keywords
Your product	Tom Ford Perfume	33100	Medium	2.51	Our product is perfumes from luxury brands so all keywords from popular brand have high search volume & moderate KD. But this is the only and most efficient way to rank for all products as a marketplace in a short time.
Your brand name	N/A				We are new so no own branded keyword search volume as of now Besides Google Search, Youtube is a great channel for SEO

YOUTUBE SEO

Besides Google Search, Youtube is a great channel for SEO to acquire top of the funnel users & even MOF to move to BOF
Creating short from content (YT Shorts) is a quick way to increase TOF awareness and rank for relevant keywords

CONTENT LOOP

Since we are in PMF stage with a unique product, our goal is to have as much Top of the Funnel awareness as possible

So there are 2 content loops we can opt for

Google/Youtube content on Trending Topics
Second would be INSTAGRAM INFLUENCERS
- Reason: Since our product has visual appeal we can leverage micro & medium sized influencers to talk about it and get awareness from theat
- Choice of Influencers (decreasing priotity)
- - Perfume Creators - These creators have audience with intent for perfumes and is a great place to make them aware of our product
  - Lifestyle Creators - Creators who create content on luxury lifestyle are a great fit as that audience wears luxury perfumes
  - Travel Creators - Since our offering is travel friendly, having organic placements with travel creators can help create a use case for our form of packaging

PAID ADS

Since we have only used organic channels for now for acuisition we don't have CAC data

But taking inndustry average for Beauty & Lifestyle category. We can assume CAC to be between 500-750 rs
Based on the subset of 200 customers, we see a repeat purchase in 45-50 days or less.
Our AOV so far is 2200 rs
Retention data we don't have so assuming they'll purchase two more time i.e. 3 times in a lifetime (which is conservative IMO because there's no alternative to us and some users already have made more than 3 purchases in 70-90 days)
So LTV could be = 2200 * 3 (frequency in lifetime) = 6600
So CAC: LTV = 1 : 8.8
This is a predictive CLTV and prone to errors.

IS CAC:LTV fit for Paid Ads

Based on the above calculations if CAC:LTV ratio is proven to be true then paid ads is a great way to scale and acquire users as the CVP of the product comes with a repeat purchase intent.
Given that only a limited set of users are purchasing luxury perfumes online, paid ads are a great way to establish PMF faster and validate retention hypothesis.
This will help to understand the pincodes where we should think about for offline expansion

WHY TARGET SPECIFIC ICPs

ICP1: College students spend alot of their time on social media - mainly Instagram, Youtube & Linkedin. So these platforms are ideal to reach them.
ICP2: This ICP also spends a considerable time online on similar platforms and has more money to spend on discretionary purchases. So this conversion potential is high here.

Product Integration

Since we are in PMF stage Integrations are skipped

RFERRAL & AFFILIATE

REFFERAL PROGRAM FOR CUSTOMERS

Since we are a D2C perfume marketplace, our currency is credits to spend on PERFUMES.

WHO DO WE NUDGE FOR THE REFERRAL PROGRAM

A user who has ordered twice.
A user who has rated us >4

ACTUAL PROGRAM

WHO?	PERKS / CURRENCY
Referrer	First Referral - 5% off on next purchase & FREE perfume samples Second Refferal - Getting added to the mailing list / whatsapp comm for EARLY ACCESS to new arrivals & EXCLUSIVE DEALS
Referee	5% off on first purchase & One free case on order above 3000

CHANNEL

Whatsapp / Email / Message to share the referral link

INCREASING AVERAGE REFERRAL

By having different perks for the 1st & the 2nd referral the chances are higher of getting minimum 2 referrals
Based on user calls we found that people are experimenting with different perfumes. And perfume pricing is very dynamic eg a GUCCI Flora would be available at MRP on Sephora & a discounted price at a different store. So once the user has built trust with us, we can leverage that and get him to refer. Getting exclusive deals has a high perceived value among the users who are already experimenting with perfumes & have built trust with us, so the only thing that's left is to offer amazing pricing. So having it as the 2nd perk increases the likelihood of the referrer delivering on the referrals.