FMCGs veer towards online male grooming

The category's blistering pace of growth is at the heart of the interest shown by these companies

Last week, Kolkata-based Emami announced it was acquiring a 30 per cent stake in Helios Lifestyle, which owns online male grooming brand The Man Company. It was the second transaction in this segment this year, after Mumbai-based Marico in March picked up a 45 per cent stake in Zed Lifestyle, owner of Beardo, a brand sold online and in salons.

Globally, Unilever — the world’s second-largest consumer goods company — already indicated that it was keen to take Dollar Shave Club, a US-based online male grooming brand acquired in 2016, to new markets, including India. Unilever might go ahead with it, given the interest shown by rivals in the space. 

At the heart of the matter, says Edelweiss Senior Vice-President (research, institutional equities) Abneesh Roy, is the category’s blistering pace of growth, which he estimates is at least 20-25 per cent per annum in India. 

Marico Chief Financial Officer Vivek Karve endorses this view, saying online male grooming is at an inflection point here. “The young male consumer is ‘digital’ in his behaviour, and therefore, there are opportunities to engage with him and sell to him on digital platforms. The market is on the cusp of growth, and is a strategic category for us since it will fast-forward our journey to a future-ready portfolio,” he says, adding the investment will allow Marico to access emerging niches and turbo-charge the company’s digital and social media marketing. 

Constituting about 5-7 per cent of the roughly Rs 5,000-crore overall male grooming market in India, the online segment — including start-ups such as Bombay Shaving Company, Ustraa, and Let’s Shave, besides The Man Company and Beardo — is small in terms of size. 

In absolute terms, experts say currently, the market is not more than Rs 350 crore. But at the rate of 20-25 per cent per annum, this category will nearly double in the next three years, making it an exciting prospect for most consumer goods companies keen to mark their presence in the space, experts say. 

Industry sources say Enami, Marico, and Unilever are the first few ones to eye the segment; more conventional consumer goods firms are likely to follow in the coming months. ITC could be a likely entrant, since it has been eyeing all emerging categories within the consumer goods market in the past few years. 

Bombay Shaving Company Chief Executive Officer Shantanu Deshpande says he isn’t surprised if this happens, though it would be a little early for consolidation. “The online male grooming market is just getting created. I see more start-ups coming in and there is need for it so that consumers become aware of the category. This will gradually expand the market,” he adds. 

Emami Director Harsha V Agarwal says his firm’s investment in Helios will allow it to fill crucial gaps in its portfolio. “Premium male grooming was a segment that was missing in our portfolio. With the acquisition of stake (in Helios), we foray into that space, as well as beef up our online capabilities,” he says.

Growth drivers

• More conscious and less price-sensitive consumers
• Increased lifecasting (taking selfies at every occasion)
• Greater social presence
• Changing nature of jobs, as well as competitive dating and matrimonial scenario