Founded in 2013, how has Swiss Beauty grown since the launch?
There was a clear gap which was identified and the founders decided to get great-quality products into the country. When they started doing that, they figured that the gap was a lot more than imagined because in India there were only traditional brands and the brands which came with great quality came in at a very, very high cost. Slowly and gradually, in the next three to four years, the acceptability really increased for the products and I think that’s when it was realised that it can be a brand, that this can have a consumer connect. Today, 10 years down the line, we are sitting at an ARR (Annual Run Rate) of Rs. 400 crore, moving towards Rs.500 cr.
What are the biggest milestones?
The biggest milestone is the range of products. We have the widest range of colour cosmetics. We cover all categories and sub-categories, possibly. And we are boasting of a portfolio of 1,500 SKUs. It was a big milestone when we crossed a thousand products.
Second, was to hit Rs. 250 cr while we are bootstrapped – we haven’t been funded by any VC, it’s a 100 pc bootstrapped brand.
The third milestone is something which we have recently done. We onboarded Taapsee as our brand ambassador and I think for a brand like ours which had such humble beginnings to today be seen across outdoor media and online portals is also a milestone. And last but not the least, the availability of the brand across over 25,000 retail touchpoints is a milestone.
What explains the proposition of elevating Indian beauty products (cosmetics) to Swiss standards?
People like you and I are just 1 pc of the population. There’s a whole mass market, there are still women today who want to use make-up but they don’t want to use substandard products, they don’t want to use something which is just run-of-the-mill and every other brand has the same thing to offer. They want products today which are of the quality of international brands. They want the quality of a MAC (professional brands) but they don’t want to spend Rs.2,000 on a Bobbi Brown or a Smashbox. They want brands which are slightly more accessible and they want products at value.
Swiss is known for very, very superior and premium quality. The idea is to match our quality to Swiss standards while giving them at prices and value for a market like India.
How is the company delivering that experience?
The experience of the product. The experience of applying the lipstick which you know is safe and does not have any lead. Applying the kajal which you know is ophthalmologically tested. Using pigments on your face, using foundation which already has a stable active ingredient like hyaluronic acid. We are trying to make sure products are dermat-tested, optha-tested. They are PETA certified, they are vegan, paraben-free, carbon-free. The idea is that you should use make-up to enhance your beauty and not to hide the imperfections. We don’t want to ruin your skin.
What are the top selling categories and their share in total revenue?
Face, lip, eye, nail, brushes and tools are the five categories we work in. Face is a very, very large portfolio. Almost 35 pc of my business comes from face as a category, followed by an equal share from lip. That is very interesting because a lot of the brands internationally and in India solely rely on lipstick as a core category and it’s very difficult for them to crack face as a category. Face includes foundation, compact, concealer; it is a category which needs a lot of trust. I think we are fortunate and confident about the products and the love we get from the consumers that we are able to have such a large quantity coming from face products.
Eye products are the third biggest category for us, followed by brushes and nails. Again, this is typically different for us than other brands because everyone has a very large nail portfolio. Their root product is nail because it’s pretty popular. For us, that’s not the case – nail is a small category but now it’s a focus category for us. We are looking at expanding our portfolio in nails.
We also work in niche categories. For example in eyes, we are not just there in kajal or mascaras, we have brow waxes and liners. We also have five to six foundations.
Concealer is one of our largest products. Recently, on Linkedin and across social media, we also went out to say that every 30 seconds we sell one concealer. We are No.1 in gloss as well on Amazon and Nykaa. And on all these online platforms, we are amongst the top five make-up brands.
Swiss Beauty has stated plans to consolidate its position in colour cosmetics and cater to sub-categories of premium and professional requirements. How?
The products which are at core of Swiss Beauty are high-performance. It takes us almost seven to eight months to get into the formulations and create products before they hit the market. And because a very, very large portfolio of my business today is still imported, the lead times are very high. What we really strive to do is to deliver a high-performance product. Our share is already very high in salons, among make-up artists, in academies. The technology used and the quality are very superior. Professional users are already using the product.
Talking about premium, that is a segment which we want to get into. We are delving into that. We will look at innovation, premiumising the packaging and formulations and try and get into that audience who we might not be catering to right now. But the current portfolio already has high-performance products which are already used by professionals very extensively.
Reportedly, the brand is introducing new categories like body care and grooming tools. Can you elaborate more on that?
We are not looking at grooming tools. We are looking at a differentiated proposition within make-up. We are trying to see how we can infuse skincare in make-up. It’s a very fast growing category. How we can get into complementing categories like mist and perfumes and fragrances. How one can expand the portfolio into skin-led products – for example, a sunscreen with a tint, so it will deliver a skincare benefit while having some make-up attributes.
At Swiss Beauty, tech and ingredients are imported from Japan, Taiwan, Italy and Germany. What are these?
Almost 80 pc of my portfolio is still imported. If I talk about say, a kajal, a small example of technology – our coloured liners are made in Germany. The machinery they have there and the machinery we have currently in India, they are not a match. The machines in India also make great kajal but in Germany, every Kajal which goes out of the machine, every pencil tip, is photographed to see the precision. If it is not exact, the entire container along with the packaging and the material gets scrapped and goes into a second bin.
Machinery and technology like this doesn’t exist in our country at the moment. It exists only in countries like Germany with our suppliers there, who have been working in this industry for over 125 years. They are the foremost manufacturers when it comes to pencils.
One doesn’t even realise that there is this level of technology available. But if they used this technology from a German brand, they need to spend Rs.1,500 or Rs.900 for this kind of kajal. We are trying to make this kajal using the same technology from the same country available to consumers at Rs.400.
The company has a retail presence of over 25,000 touch points and reaches customers in 550 cities. Is the retail presence mostly through MBOs?
The Indian woman shops at the nearest store – the local store, the general store. These 25,000 retail touchpoints are across general stores, retail stores. It includes your kirana shop, the pharmacy and your neighbourhood store. Apart from this, we are also expanding into modern trade and our exclusive outlets as well in the last three months.
We already have an exclusive outlet in Elante Mall, Chandigarh which is brand-owned. We are opening in Nexus Celebration Mall, Udaipur this month. We are opening in Amanora Mall, Pune again in the first week of September. We are opening in Lulu mall, Lucknow in the first week of September. We are hoping to close this financial year at about 10 exclusive outlets and double it next year.
What is the sales split between online and offline? The brand sells through marketplaces and its own website. How much of the sales come from the website and marketplaces?
Sixty percent of sales is from offline, 40 pc from online.
We have just about started online as an operation over the last year. We look at online as one entire ecosystem and not really as a marketplace or D2C because it’s a consumer product and you could be shopping anywhere. So our audience would be coming to our dot.com or a Nykaa – we don’t differentiate.
The company claims to have a strong market presence in Delhi, Mumbai, Kolkata, Lucknow, Jaipur and Bengaluru. What explains this? Are there other geographies you are targeting?
The market size of North is really high. We have got an overwhelming response from Delhi. It was just obvious because we are headquartered in Delhi. The easy access points were Jaipur, back in the day. So, Delhi, Jaipur, Ahmedabad and Lucknow became our core cities in this region. Then we expanded and we went to Mumbai and Kolkata and now we are seeing Mumbai shape up. Now, suddenly in our Google searches, we are seeing Bengaluru and Hyderabad coming up. As we move along, we are trying to strengthen West and South. But, we are very predominant in the North.
There’s a deluge of beauty brands in the Indian beauty space. How is Swiss Beauty positioned? How are you differentiating yourself?
While a lot of other brands spend a lot of marketing dollars in trying to market themselves, for us it’s the reverse with R&D coming first. Marketing is something we have just started.
We have been in the market for the last 10 years. We never had a single celebrity associated with the brand. That is something we recently started, three months ago. The focus in all these years has purely been on the customer and the product. Every extra dime and dollar that we have in the company or the margins were all reinvested into the company to make a stronger R&D team and a very strong testing team. Our product is the core of the brand. As the CEO of the company, every week, twice, for two hours, I still sit only on products. I don’t look at sales, marketing or finance, I only spend that time on products. I think that’s what sets us apart – the quality of the product.
We have very high repeat percentages, be it in our beauty-assisted stores, or kiosks, or a Nykaa, Amazon, or on our own website. Everywhere I can map data, I can see a very high repeat purchase.
And last but not the least, I have make-up for everybody. As a 16-year-old, I have these pop style liners at Rs.199, for a 25-year-old we have gel liners for Rs.399 and if you are a 33-year-old and you want a slightly differentiated product, we have that as well. I think the idea is that we are trying to pan across age, gender and the needs of whatever a man/woman of today needs.
Recently, you onboarded Taapsee Pannu as brand ambassador and did a campaign with her. Tell us about the association and how did that campaign fare?
The campaign was to embody what Taapsee’s personality is. She is very bold, confident. She is who she is. She doesn’t fake it, she doesn’t take nonsense from the media or from other celebrities. She had very humble beginnings and a non-film background and I think all of this resonates very well with what Swiss Beauty is. We do not come from any large VC fund, we do not come from any big house of brands. We started from Delhi. We never looked left or right, never looked at what competition was doing. We just put our heads down and worked. The synergy between the two was very high, with very similar DNA.
I think she married that into the campaign very well. The campaign was very well received. We are already at a plus of 7 million views on YouTube in about a month. We did another small format video with her on Instagram. The overall views, the impressions we are getting are fabulous.
We have also done branding on ATL, BTL. That is also working. The click-throughs have also increased. From a positioning perspective, it is definitely impacting and we can see that happening. I have worked with celebrities in the past and I have seen that you do tend to get some push back from consumers if they do not like the celebrity or they think the celebrity doesn’t fit the brand very well and it feels very forced. Fortunately, we go through all our comment sections and they are fabulous. There hasn’t been a backlash and I think everyone has appreciated the association between the two. It has been treated as a very authentic association. All in all, the sentiment is very high.
Tell us about the marketing approach of Swiss Beauty.
We do 360-degree, full-funnel marketing. What you will see at my kiosk in Chandigarh is what you will see – the same visuals, campaigns – across Nykaa, our dot com, social media, modern trade store and beauty-assisted, across cities. On digital, we continue to advertise very extensively across Meta and Google but I think our biggest mediums continue to be our retail outlets and our very strong presence across digital platforms.
We just completed 10 years and we did something called ‘10 on 10’ birthday sale. A video went out from Taapsee wishing the brand. The brand celebrated this across its website and multiple other touchpoints. We were making a transaction and selling a product every 3.3 minutes. Sales was good and it was a good marketing event where a lot of consumers got to know about the brand.
What are the future targets of the brands? Are you looking to explore any new product lines or product categories?
We have a large team and we are constantly innovating and trying to see how we can differentiate on aspects like product, packaging, SKUs. On how we can make something easy for the consumers. We are constantly trying to catch global trends. There are so many liquid lipsticks in the market today. We already have two to three in the brand. We are launching another one in the next few days but that comes with apricot oil, 100 pc hydration play, 12-hour stay. We understand the challenges. As a girl when you use a liquid lipstick and a matte lipstick, it tends to dry your lips, so you have to use a balm before or you are struggling to remove it. What we are trying to do is figure out how we can marry the two and we have put apricot oil in the lipstick so that while it’s giving you the matte finish, it should not dry your lips. We continue to innovate across products and foundations.