Nykaa is India’s largest beauty retail startup with 2400+ authentic brands and 1.9L+ products.

Nykaa has created a niche for itself in retailing beauty brands by delighting customers with access to a finely curated, authentic assortment of products and services.

Nykaa is a direct-to-consumer(D2C) brand operating on the inventory-based business model, this approach helps them to ensure the authenticity of products, and control pricing and the customer experience.

Nykaa boosts 40M+ app downloads and has 120+ offline retail stores across India.

Under our Indian Startup Case Study Series, We already covered CRED and Meesho Case Study.

This time we bring to you a comprehensive Case Study of Nykaa's Business Model.

By the end of this blog, You will have a good sense of...

  • Nykaa Growth Story
  • Nykaa Business Model
  • Nykaa Marketing Strategy
  • How Nykaa makes Money?
  • Nykaa Funding & Acquisition
  • Nykaa Financials
  • Nykaa Future Plans
  • FAQs

How does Nykaa Works?

Nykaa offers a well-curated selection of products across makeup, skincare, haircare, bath and body, fragrance, grooming appliances, personal care, and health and wellness categories from domestic, in-house, international, luxury and premium brands.

Nykaa Fashion, Nykaa's fashion vertical was launched in 2018 as a curated and managed marketplace to inspire the customer to make fashion choices that suit them.

Nykaa Fashion houses 1,500+ brands and over 1.8 million products across five consumer segments: women, men, kids, tech and home offering a mix of brands across established national brands, international brands, luxury brands, and emerging labels and designers.

Nykaa has built a separate business vertical and channels for beauty and personal care brands and fashion brands since the customer journey to purchase these products are quite different.

Apart from a wide range of brand collections, and personalized customer experience Nykaa has built a good range of content, and communities to educate customers about the products.

How Nykaa Works- Nykaa Business Model 

Nykaa has positioned itself as a lifestyle retail platform offering a diverse range of beauty, personal care and fashion products including domestic, international, luxury and in-house brands.

Compared to other beauty and personal care brands, Nykaa has built a strong brand recall and trust among its customers.

Nykaa understands the whole customer purchase journey beginning from exploring products to making the purchase decision and provides personalized customer experience through their online platform and physical stores.

Customers trust Nykaa for its diverse collection, authenticity and customer service.

Source: Nykaa DRHP 

Nykaa Growth Story

Falguni Nayar founded Nykaa in 2012 with the vision of building a multi-brand omnichannel beauty-focused retail business. After graduating from IIM Ahmedabad, Falguni Nayar started her career with A.F. Ferguson & Co.

Later she joined Kotak Mahindra Bank, where she helped several businesses and was the Managing Director of Kotak Mahindra Investment Bank, and was the director at Kotak Securities.

After spending 18 years in Kotak, she decided to pursue her entrepreneurial dream and was evaluating several ideas.

She saw a large gap in the Indian BPC market, at one end there are few high-end beauty brand retail outlets serving customers in Tier-1 cities and at the other end, customers buy beauty products from unorganized sectors including local grocery and department stores.

Traditional beauty brand outlets have a limitation in reaching customers and offer customers a limited variety due to space constraints.

In the last decade, online shopping saw an increased adoption from Generation Z and Millennials who are also the major customer segment for the BPC sector.

Generation Z and Millennials together account for ~70% of the smartphone users in India and are the most active consumers of social media content.

She saw this as an opportunity and started Nykaa with a mission to deliver authentic beauty products from domestic, international and luxury brands to Generation Z and Millennials customer segments.

According to the RedSeer Report, Nykaa has a large BPC market opportunity of ₹1,120 billion (US$16 billion) growing at 12% per annum to ₹1,981 billion (US$28 billion) in 2025.

The fashion opportunity of ₹3,794 billion (US$54 billion) is expected to grow at 18% per annum to ₹8,702 billion (US$124 billion) in 2025. Nykaa has a total addressable market across beauty and personal care and fashion of ₹10,683 billion (US$152 billion)

B&PC Segment Market Overview - Nykaa Business Model | Source: Nykaa DRHP

Nykaa was started as an online brand in 2012 and in 2014 moved to an omnichannel model by opening physical stores to offer customers a holistic shopping experience.

  • In 2015, Nykaa launched its makeup and beauty accessories brand  ‘Nykaa Cosmetics’.
  • In 2016, Nykaa launched its own naturally derived ingredients-focused skincare brand ‘Nykaa Naturals’.
  • In 2018, Nykaa entered the fashion vertical by launching "Nykaa Fashion" as a curated and managed marketplace.
  • In 2019, Nykaa launched its own beauty range ‘Masaba by Nykaa’ in collaboration with Masaba Gupta.
  • In 2020, Nykaa launched its intimate wear brand ‘Nykd by Nykaa’.
  • In 2021, Nykaa launched the first MBO store for Nykaa Fashion and ‘The Global Store’.
  • In the same year 2021, Nykaa made a dream IPO debut with the stock listing at Rs 2,018 with a 79% premium.
  • In 2022, Nykaa launched Superstore, a one-stop B2B shop, focusing on beauty and personal care offering 100% authentic products across top brands.
Nykaa Growth Story - Nykaa Business Model 

Nykaa Business Model

Nykaa started as an online e-commerce brand in BPC(Beauty and Personal Care) space and repositioned to an omnichannel model in 2014.

Apart from its online business, Nykaa has three offline store formats:

  • Nykaa Luxe - Nykaa Luxe focuses on the luxury beauty experience showcasing prestige international and domestic brands.
  • Nykaa On Trend - Nykaa On Trend offers current best-selling products that are trending based on reviews and ratings.
  • Nykaa Beauty Kiosk - Nykaa Kiosks are comparatively smaller outlets mostly selling in-house brands.

Customers would like to touch and feel certain products before they make the purchase decision, and physical stores play a key role in providing this customer experience.

Brand presence across online and offline channels elevates customer experience and increases customer acquisition organically.

The company has a network of about 120 physical stores spread across India and aims to increase the count to 300 in near future.

Apart from offering a wide range of brands, Nykaa has its beauty and personal care products under “Nykaa Cosmetics”, “Nykaa Naturals” and “Kay Beauty” which are available in online and offline channels.

Nykaa follows an inventory business model in which products are bought from brands, and authentic distributors directly and stored in warehouses.

These products are sold through the Nykaa website, mobile app, and physical stores.

The inventory business model allows Nykaa to own product quality, pricing and on-time delivery.

Nykaa Business Model Canvas- Nykaa Business Model

Customer Segments:

Nykaa has highly diverse customers spanning different age groups, gender and consumer profiles with Generation Z and Millennials being their primary customer segment.

Value Proposition:

Nykaa’s core value proposition is to provide customers with 100% authentic products from a diverse range of national, international, luxury and premium brands.


Nykaa’s most of primary customers are internet users and depend on social media heavily to discover new products and to make a purchase decision. Nykaa focuses predominantly on digital channels like social media and blogs to reach its potential customers.

Customer Relationships:

Nykaa has established a strong relationship with its customers through its educational content in different online channels.

Apart from this, Nykaa has built a good in-person relationship with its customers through its physical stores and by conducting various events.

Revenue Streams:

Nykaa’s main source of revenue comes from the selling of beauty and personal care products, and fashion products through their online platform and physical stores.

Key Resources:

Nykaa’s key resources include its technology stack as they primarily depend on the online platform, its physical stores and human resources.

Key Activities:

Nykaa’s primary activity is to ensure customers are provided with 100% authentic products and to maintain their brand value.

Nykaa also needs to focus on its sales and marketing efforts to drive revenue and maintain a lasting customer relationship.

Key Partnerships:

Nykaa depends largely on its brand partners for a diverse brand listing, manufacturers and vendors to produce internal brands, delivery partners for seamless delivery and influencers to educate customers on its products and to acquire new customers.

Cost Structure:

Nykaa’s major expenses are from the purchase of traded goods, marketing costs, selling and distribution costs and employee management expenses.

Nykaa Marketing Strategy

Nykaa has carved out a brand identity for itself in the Indian BPC market by communicating what the brand stands for with its marketing strategy.

The core marketing strategy of Nykaa has been digital marketing since the majority of its customer segments are digitally native and make their purchase decision through social media content.

Social Media Marketing:

Social media marketing has become one of the important channels as it has the potential to alter consumer buying behaviour.

Customers discover new beauty and fashion products through the latest trends in social media and their networks on these platforms.

Nykaa uses social media marketing to create brand awareness, and acquire new customers by promoting their products.

Nykaa's social media channels engage with customers by sharing useful tips about beauty and personal care brands and also posting content created by influencers about Nykaa products.

Nykaa gets the majority of its social media traffic from Youtube, followed by Facebook and Instagram. Nykaa has a very strong social media presence with 3.4M followers on Facebook and 2.2M followers on Instagram.

Nykaa Social Media Marketing Overview | Source: similarweb

Influencer Marketing:

Influencer marketing is an efficient way to reach customers to build brand awareness and trust.

Nykaa uses influencer marketing to educate customers about beauty products through creative and entertaining content.

Apart from its relationship with celebrity influencers, Nykaa leverages influencers via Nykaa Affiliate Program, which enables more content creators to publish content on the brand's behalf across digital platforms.

Nykaa has the largest influencer network in the online beauty and personal care segment in India with influencers including the likes of Generation Z trendsetters, mommy bloggers, beauty, fashion and lifestyle bloggers, makeup artists and celebrities.

In Dec 2021, Nykaa collaborated with influencers for the promotion of its newly launched ‘Clay it Cool’ mask range.

The influencers posted pictures on their Instagram handles with the masks, reviews and how-to videos using the mask.

The brand has worked with female influencers with less than five lakh followers and was able to create a lot of buzz with 3M views within the first 2-3 days.

YouTube Marketing:

Nykaa follows a distinct Youtube marketing strategy and gets most of the site traffic from the YouTube platform.

Nykaa's YouTube channel, Nykaa TV produces educational content on the latest makeup trends, skincare routines, expert talks, and makeup tips by famous beauty influencers.

Nykaa does not focus on selling its products through its YouTube channel, rather helps customers in choosing the right beauty products and helps them to use them correctly with its how-to videos.

Nykaa TV video guide content is produced in multiple languages to target customers in specific regions.

Nykaa TV also produces expert talk videos to help customers understand the product importance and the need to use them.

Apart from their channel, Nykaa uses YouTube ads to reach out to their customers. Nykaa TV boasts 1.3M subscribers and is one of the important distribution channels for the brand.

Content Marketing:

Online content plays a vital role in helping customers to understand and make purchase decisions in beauty and personal care brands and fashion.

Content marketing plays a key role in Nykaa's marketing efforts since their core customer segments, GenZ and millennial customers consume online content on all social media platforms.

Nykaa’s content marketing strategy focuses on creating content to educate customers about beauty and personal care brands.

Nykaa Content Marketing | Image Source: Nykaa investor Relation Presentation Report, Q2 FY23

Nykaa’s primary content marketing involves blogs, videos on beauty and fashion tips, trending products and guidelines on choosing beauty and personal care products.

Nykaa produces most of its content in-house through Nykaa Army, a team of beauty and fashion content creators. Nykaa also works with brand partners to create content to amplify their brand story and products.

  • Nykaa beauty book, Nykaa's blog, offers weekly top stories about cosmetics. Apart from this, the blog has helpful articles on various beauty topics like makeup, skin and hair care, personal care and product reviews.
  • Nykaa launched Explore 2020, an in-app content aggregation hub that provides a “watch and buys” feature to enable a consumer to watch content and shop for the products featured in that content in real time.
  • The content is predominately multi-brand and education-focused, including tutorials on ‘how-to’, reviews, and product trials.

Most of the brand content has a good reach among its customers which eventually helped the brand to have good search result ratings and generate more leads.

Content Marketing Awards won by Nykaa...

  • In 2018 and 2019 Nykaa was awarded the Best use of Intelligent Content (Digital Presence) Award at the Content Marketing Summit and Awards.
  • In 2019 Nykaa was awarded the Best use of Content to Commerce Award at the content Marketing Summit Asia.

Email Marketing:

Email marketing is a powerful marketing channel to generate engagement and sales by promoting a business’s products or services.

Nykaa uses email marketing to build a relationship with its customers and to keep them updated about their upcoming events and product deals. Nykaa also sends out emails on current popular trends in the industry to keep its customers aware of the latest trends.


Nykaa uses SEO optimization techniques to build brand awareness and attract customers interested in beauty and personal care brands to their website.

Nykaa has implemented an effective SEO strategy by using relevant keywords and search engine-optimised content on their web page, beauty blog posts and articles.

Nykaa’s main traffic source is through search, driving 56.88% of desktop visits last month, followed by direct search contributing to 34.61% of traffic.

Nykaa’s SEO strategy has helped the brand to improve its search traffic and to generate organic leads for customers interested in beauty and personal care products.

Nykaa SEO Stratrgy | Source: similarweb

Event Marketing:

Event marketing helps the brand to build stronger relationships with existing customers, and brand partners and acquire new customers.

Starting in 2015, Nykaa has partnered with India’s largest and most widely read English women’s magazine, Femina to host Nykaa.com Femina Beauty Awards. Femina tests every skincare, haircare, and makeup product out there, and then customers vote for their favourite products.

This is a premier event which helps Nykaa to build relationships with people in the BPC sector, amplify customer choices and understand their preferences.

Omnichannel Strategy:

Nykaa predominantly concentrates on digital marketing but customers love to touch and feel many of the beauty products before they make a purchase decision.

To bridge this gap, Nykaa has opened offline stores which allow the brand to improve overall customer experience.

The beauty advisors in physical outlets will help to personalize the customer shopping experience and use their expertise to market suitable products to the customers.

In the physical outlets, Nykaa organizes events conducted by experts to drive engagement with customers.

In 2019, Nykaa was awarded:

  • Best use of Omni-Channel Content Award at the Content Marketing Summit Asia.
  • Best Omni-Channel Content Strategy Award by National Awards for Marketing Excellence.

How Nykaa makes Money?

In Q2 FY23, Nykaa recorded a 39% YoY Revenue growth compared to Q2 FY22. The Company earns revenue from the below verticals:

Nykaa Revenue Model | Source: Nykaa investor Relation Presentation Report, Q2 FY23

Nykaa, Beauty and Personal Care Products:

  • Nykaa Fashion
  • Others - NykaaMan, SuperStore(eB2B platform), Nykaa International, Little Black Book(LBB), Nudge Wellness

Nykaa - Beauty and Personal Care Products:

  • Nykaa BPC segment is a major contributor to the overall revenue accounting for Rs.10,825 MM.
  • Nykaa operates in an inventory model in which the company buys products directly from brands or authorized distributors and sells them on its web, app and physical outlets.
  • Nykaa also has its private label produced through contract agreements with third-party manufacturers.

Nykaa Fashion:

  • Nykaa Fashion accounts for Rs.1016 MM in the overall revenue.
  • Nykaa Fashion operates as a curated and managed marketplace with a wide assortment of offerings catering to women, men and children of diverse demographics.


  • The Other section represents the revenue from NykaaMan, SuperStore(eB2B platform), Nykaa International, Little Black Book(LBB), and Nudge Wellness.
  • The combined entities under this section contribute Rs.467MM to the overall revenue.

Nykaa Funding & Acquisition

Nykaa founded in 2012 has raised a total of $148.5M in funding over 13 rounds. On Nov 10 2021, Nykaa made a dream IPO debut with the stock listing at Rs 2,018 with a 79% premium.

According to NSE data, Nykaa received bids for 2,16,59,47,080 shares against 2,64,85,479 equity shares on offer.

The Qualified institutional buyers and non-institutional investors showed strong interest in the offer, as their reserved portion was subscribed 91.18 times and 112.02 times, respectively.

Nykaa has acquired six organizations including LBB, Nudge, Dot & Key Wellness, Kica, Pipa Bella and 20Dresses.

Nykaa Financials

In the recently declared Q2 FY23 results, Nykaa has displayed strong performance across all the financial metrics with an increase in revenue of 39% YoY growth and an increase in gross profit of 45% YoY growth.

Consolidated statistics across all three verticals:  BPC, Fashion and Others

Nykaa Financials | Source: Nykaa investor Relation Presentation Report, Q2 FY23
  • Gross Merchandise Value (GMV) represents the monetary value of Orders inclusive of taxes and gross discounts, if any, across our websites, mobile applications and physical stores before product returns or order cancellations and including sales to and through third-party channels.
  • EBITDA - Earnings before interest, tax, depreciation and amortisation.
  • PBT - Profit Before Tax
  • PAT - Profit After Tax

Nykaa BPC segment:

Nykaa Financials | Nykaa BPC Segment | Source: Nykaa investor Relation Presentation Report, Q2 FY23 

Nykaa Fashion Segment:

Nykaa Finsncials | Fashion Segment | Source: Nykaa investor Relation Presentation Report, Q2 FY23

Consolidated Financial Summary across all the verticals:

  • Nykaa has recorded a 344% YoY increase in Q2 FY23 recording a net profit of Rs 5.2 crore.
  • Gross Profit has recorded a 45% YoY growth and revenue recorded a 39% YoY growth compared to Q2 FY22.
  • Compared to Q2 FY22, Selling & Distribution Expenses and Employee benefits expenses have increased drastically by 102% and 76% respectively.
Nykaa Financial Summary | Source: Nykaa investor Relation Presentation Report, Q2 FY23

Nykaa Future Plans

Nykaa has been expanding its business by entering new markets and products along with various partnerships.

Nykaa aims to increase the number of international brands sold on its platform and expand its physical store presence. Nykaa is also working out plans to take its brand international to explore other markets outside India.


Superstore By Nykaa, is a one-stop B2B shop, focusing on beauty and personal care offering 100% authentic products across top brands.

Superstore allows retailers to access the entire range of beauty products on a single platform with the flexibility to choose order quantity, delivery and credit facility.

Exploring International markets:

Nykaa has partnered with UAE-based retailer Apparel Group to expand its business into the Gulf region.

The alliance between the two companies will build an omnichannel multi-brand beauty retail business offering products and services in countries part of the Gulf Cooperation Council(GCC).  

Nykaa has opened its first brand outlet with Nykaa BPC-owned brands in Mauritius. Nykaa has launched its BPC brands in four e-commerce marketplaces in UAE and two e-commerce marketplaces in the USA.


  1. Who founded Nykaa?

Nykaa was founded by Falguni Nayar in 2012 when she saw Indians have no access to authentic multi-brand beauty brands.

2. What type of business model is Nykaa?

Nykaa started as an online beauty brand and moved on to an omnichannel strategy by opening physical outlets to improve the customer experience.

3. How did Nykaa Become Profitable?

Nykaa followed an inventory-based which helped Nykaa to control authenticity, product pricing and customer experience.

Nykaa has a unique selling point of offering a wide variety of authentic products than offering larger discounts.

Nykaa has very good content marketing which helps them to acquire new customers and convert them at lesser or no cost. These key factors make Nykaa's capital efficient and profitable.