The venture funding received by GlamEgo will be utilised in scaling up its business and expanding its offerings from about a hundred brands to 200-plus this year.
The Hyderabad based cosmetics start-up which delivers beauty boxes through the subscription model to its customers, GlamEgo has secured its first round of venture funding of $500,000 (INR 3.45 crore, approximately) from Brand Capital, the strategic investment arm of the Times Group.
The start-up aims at utilising the funds received toward scaling up of its business operations. The company will endeavour to penetrate deeper into the domestic market by targeting the potential customers from not only the metropolitan centres but also from the non-metro towns in the country.
The business model
GlamEgo’s concept of a subscription box is simple. It curates these boxes for its customers based on their preferences and affordability. The boxes contain cosmetic and skincare products. GlamEgo delivers these boxes across India and has so far delivered them to 38,000 locations till date. With this VC funding, the company plans to take on the existing players operating in the subscription cosmetics space in India.
Since GlamEgo curates these boxes across the country and since India houses a diversity of states (and union territories) of different environmental conditions, curation of the boxes like these calls for immense thought and study. GlamEgo tries to gauge the preferences of each subscriber using a questionnaire sent to them. The questionnaire helps its subscribers list out their preferences and requirements and on the basis of their answers, GlamEgo custom-makes the boxes to be delivered to individual subscribers. The cosmetics company claims to have engaged with 85 brands and plans to take the tally 200 soon.
Down the memory lane
GlamEgo was founded by Lavanya Sunkari and Prabhakar Darakapalli in the year 2017. Lavanya has approximately 10 years of marketing experience working with various organisations and Prabhakar comes from the technology background. Combining their strengths, the duo founded GlamEgo, a technology-powered start-up with a subscription-based model. The company targets consumers who look for beauty and cosmetic products at an affordable price range. GlamEgo provides its beauty boxes that pack premium products priced in the range of Rs 1,500 and Rs 2,000 for a subscription fee of Rs. 399. After this funding, the start-up plans to introduce its own make-up line that it claims will be of international standards.
GlamEgo claims to be controlling 55 per cent to 58 per cent market share in the subscription-based cosmetics box business. Besides GlamEgo, the brands vying for the Indian consumer’s attention (and rupees) in this segment include Beauty Wish Box, BeingJuliet, FAB Bag, Globox, Lady Raga Bag, Look Fantastic India, MSM Box, My Envy Box, Mystery Box, OhCuteBox, O My Bag, Sugar Box, The Red Box, and Violet Box.
GlamEgo was at 500 boxes per month last year and has increased that number to 50,000 monthly orders today. The founders of GlamEgo are looking forward to increasing their company’s market share further by signing up with more number of premium brands and taking them to the target customers at affordable price points. GlamEgo uses social media channels for its marketing to reach out to people and engages with powerful social media influencers who explain its brand value and concept to online consumers via social platforms.
The changing consumer psyche
The Indian consumer is said to be open to trying out new things as her exposure levels have increased due to a range of factors including globalisation, growing internet adoption, social media, mobility, and international travel, to name a few. Online shopping has exponentially grown across the globe and also in India. Consumers are looking for more convenience in shopping. They are open to the concept of curated boxes in many things including make-up, clothes and accessories especially when they are custom made and delivered to their doorstep.
Start-ups seem to have understood this consumer psyche and their need for novelty and convenience. They are trying to combine these factors while creating boxes according to consumer preferences of skin type, complexion, skin problems, body type, measurements, etc. and deliver them to their doorstep. The success of the new subscription model introduced by various companies including startups can be attributed to this changing consumer psyche and the ability of startups to nimbly respond to this change.