Why WOW Skin Science is Betting Big on the Offline Retail Market
Why WOW Skin Science is Betting Big on the Offline Retail Market

Launched in 2015, the direct-to-consumer (D2C) company WOW Skin Science is making a name for itself in the beauty and personal care space. The brand focuses on launching innovative, research-backed products, with a recent entry into the sustainability bandwagon through its Vitamin C Paper Tube launch.

In the past two years, the brand has brought on board eminent celebrities to be part of the brand family and promote multiple product ranges, from Kareena Khan endorsing the Apple Cider Vinegar Drink to Bhumi Pednekar leading the skincare range to Kartik Aaryan and Rashmika Mandanna becoming the face of WOW hair care range.

Last year, the brand garnered revenue of Rs 400 crore. This year, it plans to touch Rs 550-600 crore in revenue.

“We are looking at reaching a target of  around Rs 2000 crore in the next 18-24 months,” Manish Chowdhary, Co-Founder, WOW Skin Science said.

Brand Play

The brand is currently present in three main categories – skin care, hair care, and nutraceuticals. It offers close to around 400 SKUs. WOW Skin Science has nine hero ingredients that it plays on, including aloe vera gel, aloe vera, apple cider, onion, vitamin C, etc.

Talking about building House of Brands, Chowdhary said it is a fashion of the street but at our end, we want to do more of quality versus quantity as we know how difficult it's to build a brand. “We are here to solve a consumer problem more than throwing brands at a consumer's face; hence we have to be very precise on what we launch,”

WOW Skin Science will be launching around 4 brands by early next year, and around 7-8 quality brands over time, focusing on health and beauty as a core category.

Explaining if the brand is planning to launch in-house brands or acquire new brands, Manish said, “Wherever we don't have capabilities and we want to short circuit the process, we'll acquire the brand. Also, WOW has got a conveyor belt of supply chain innovation, hence, when we think we can build it organically with our playbook, we will launch in-house brands. These new brands that we will create will not be a direct competition to WOW, but they will be complementing each other,” he stated.

Online-Offline Mix

Apart from its website, the brand is present across 25 other marketplaces. Of all the marketplaces, Amazon, Flipkart, and Nykaa contribute to around 90 percent of its revenue.

“Our D2C website contributes to around 25-30 percent of our total sales,” Chowdhary asserted.

On the offline front, the brand has around 350 BAS (Beauty Advisors Stores), wherein there's a representative who's advising consumers why to buy the brand. Additionally, it is present in 30,000 General Trade stores and looking at expanding that gradually as it builds the brand as a strategy.

“We have a potential to get into 2 lakh stores, which we plan to build over the next two to three years,” he claimed.

WOW Skin Science has also increased its footprint in modern trade stores. The brand is present in Reliance, DMart, More, etc. Shop-in-shops as well as having exclusive stores will be a path to its execution plan over the next 12 months. The brand will be focusing on data to understand which cities it should target for offline expansion.

“We plan to launch our first standalone store by early next year,” Chowdhary informed.

“At present, 80 percent of our sales come from online while the remaining is contributed by offline channels. Going forward, we expect 60 percent of our revenues to come from online while the rest 40 percent from offline,” he added.

Tier II & III Cities: Major Contributor

The brand believes that loyalty is the biggest in these cities. Also, the availability of good brands is less so loyalty improves.

WOW is a digital-first company therefore, it targets these markets by pin code. The brand goes down with historic data and understands where the loyalties of its consumers lie and then adopts strategies to build the presence of the brand.

“Currently, Tier II and III cities contribute around 30-35 of our revenue,” he said.

Integrating Technology

WOW Skin Science is investing heavily in data science. The brand believes that to be a differentiator from other companies, it has to focus on data capabilities - what kind of insights to get from consumers, what is the pattern of buying, what kind of discount seekers are they, etc.

“Whatever we are building today is for a stronger tomorrow, but a lot of our investment is going deeper into data,” Chowdhary stated.

The brand is also in the beta testing phase of incorporating AR/VR filters into its D2C website.

“We are also experimenting in the Metaverse. At our end, it would be used for consumer experience and brand building,” he noted.

Focusing on Influencer Marketing

The brand focuses more on brand building spends than performance marketing spends. It does Insta Live, and UGC content to give out to its consumers. WOW Skin Science was one of the early adapters of Content-to-Commerce and focuses on this strategy to gain more consumer traction.

Also, influencer marketing is one of the largest spends for the brand.

“Influencer marketing is extremely important for us. We do a complete data analysis before deploying influencers like who's the right fit for us, what kind of audience they connect with, which are the last brands they advertise or they collaborated with, etc. All this information is given to you, so you get to know a little bit more about what type of audiences they have. It's a word-of-mouth channel which is the most important channel for any brand. But today in so much clutter, you have to use data and a little strategy of how do you deploy it,” he explained.

READ MORE: WOW Skin Science: Natural Skincare

Future Outlook

The brand has been growing at 100 percent year-on-year but it believes that it might have to settle down for less this year.

“We have always achieved 100 percent year-on-year. This year it might not happen but it'll be a good year because we are building a good team, playbook, and foundations for tomorrow,” Chowdhary said.

Globally, WOW Skin Science is present in 10 countries. It is the first Indian beauty brand to be in 3000 Walmart stores in the US.

“Our international business contributes around 15 percent of our total sales,” he concluded.

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