Wallet share moves to new beauty, personal care items

Hindustan Unilever's interest in Minimalist reflects India's booming beauty market, projected to reach $30 billion by 2027, with a shift towards premium D2C brands.

The buzz around Hindustan Unilever Limited’s potential takeover of the Jaipur-based direct-to-consumer (D2C) beauty brand Minimalist highlights the increasing customer interest and growth in the segment. An earlier report by Redseer Strategy Consultants and Peak XV had estimated India’s beauty and personal care (BPC) market to grow at 10% and reach $30 billion in size by 2027.

Wallet share moves to new beauty, personal care items

In its December 2024 FMCG Pulse study, research firm Kantar said in the personal care segment, liquid beauty products were doing well. K Ramakrishnan, managing director (South Asia) at Worldpanel Division, Kantar, said facewash had 30% penetration in India and handwash was at 18%. “Bodywash penetration is still low but conversion is inevitable owing to consistent marketing efforts by companies. Marketeers like it as it delivers higher margins and consumers like it as it saves the mess. This backs the premiumization trend among consumers,” he said.

The rise of liquid beauty categories reflects a shift in consumer preference towards convenience, hygiene, and premium experiences, said Virat Khanna, marketing head for skin care at Dabur India Limited. “Gulabari has tapped into this trend with the introduction of premium shower gels with exotic ingredients like Himalayan Rose and Oudh. This premiumisation aligns with the growing demand for indulgent and sensorial experiences,” Khanna said.

Thirty years ago, one soap sufficed for the whole body. Then separate products were created for face and hair. “And now there are multiple products for different parts,” Kedia said. “People have evolved in their beauty journey and follow multiple steps in skin care that have gone beyond cleansing, toning and moisturizing,” he added.

Pilgrim offers colour cosmetics and products for skin, hair and body based on international beauty recipes and ingredients like volcano lava ash, white lotus and squalane from Spanish olives. “In beauty and personal care segment, the share of wallet is moving from large FMCG companies to innovative and premium D2C brands”, Kedia said. To be sure, several new-age beauty brands have touched an annual revenue of ₹300 to ₹500 crore.

Nikita Khanna, founder of Moxie Beauty, agreed that consumer spending is shifting as they add more inventive products to their purchase basket. “Typically, a 52-year-old woman buying a facewash and moisturizer has a 25-year-old daughter adding three skin or hair serums to her basket. Young women are using more products than their mothers on a day-to-day basis and even more when they dress up, adding colour correctors, highlighter, brow gel etc.” Khanna said.

Fourteen-month-old Moxie focused on the hair category as the skin care segment has evolved over the last five years with several D2C brands in the fray, Khanna said. “In hair, this shift is just happening, and people are asking for high performance products. In the first round of the D2C revolution in BPC, companies offered clean, toxin-free products. Now the consumer is demanding outcomes. Chemical-free is basic hygiene for brands, customers want results,” Khanna said.

Khanna and Kedia believe that discretionary spends will continue for brands that are able to deliver on their promise. “India is still evolving in terms of beauty consumption. An average woman in Korea uses 12 products on her skin every day. We are bullish about India and expect more action in the mass premium and premium end of the category,” Kedia said.