It is the season of IPOs!
Grab was listed in the US stock market in the first week of December. At the same time, India saw one of its most profitable IPOs when beauty e-commerce platform Nykaa went public in early November. Nykaa going public wasn’t the only reason investors were interested. They wanted to understand if Sociolla, a beauty e-commerce platform with a similar business model to Nykaa, had the traits to succeed in Southeast Asia. The common question asked by many of these investors was,
“Is Sociolla in Indonesia similar to Nykaa?”
This debate piqued our interest as well. Are they really the same? Sociolla, like Nykaa, is a beauty e-commerce platform focused in Indonesia and Vietnam, and it raised $56 million earlier this year. Upon a brief overview, they seem a lot alike, but we decided to further analyze them under a microscope.
Founding members and investors
There aren’t any common investors or founding members between the two companies.
Nykaa was founded in 2012 by Falguni Nayar to make beauty products, at par with international standards, accessible at a reasonable price across India. Some of the key investors in Nykaa include TVS Capital, Hero Group, Max Group, Steadview Capital, TPG Growth, Lighthouse Funds and Fidelity Management & Research Company.
Sociolla was founded in 2015 by Chrisanti Indiana, Christopher Madiam and John Rasjid to provide authentic and genuine beauty products across Indonesia. Sociolla is backed by major venture capitalists like Temasek Group, East Ventures, Istyle, EDBI, Jungle Ventures and Pavillion Capital Partners.
Though Sociolla and Nykaa were started for different reasons, the target audience they cater to is primarily the same. Their primary audience is women, especially those studying and working between the age groups 16-40. Most of them are middle-class women who want genuine products for a good price.
Range of products
A majority of the products and categories on Sociolla and Nykaa are similar – makeup products, skincare, haircare, perfumes, etc., not just for women but for men too.
Given that the region they cater to is different, both platforms have specialized products that appeal to respective target audiences. For instance, Nykaa has a separate category for natural products as many Indians lean towards herbal and organic makeup and skincare products. Apart from this, Nykaa also has a Health and Wellness section for health and beauty supplements, nutrition, pain relief and other related products.
When you look at Sociolla, it has a separate section focused on body treatment, bath products and accessories such as makeup brushes and other tools. Perhaps, in the future, it would be heartening to see more products specifically created with the needs of the Indonesian people in mind from Sociolla.
Mom and baby line
While Nykaa already has mom and baby products, Sociolla is planning to launch a separate platform called Lilla, exclusively for mom and baby products. Unlike Sociolla which states it’s going to be focused only on beauty products, Nykaa is taking the next step forward by plunging into the fashion sector in India.
Both Nykaa and Sociolla started out as e-commerce platforms but soon moved to the omnichannel model – which is online+retail experience. Apart from having an online platform, both of them also set up retail stories (also called experiential stores by brands) across their respective regions to increase sales, brand recognition and trust. Nykaa has over 80 stores across India while Sociolla has close to 30 stores in Indonesia and Vietnam.
The launch of retail stores helped both these companies reach audiences they couldn’t have targeted online. Since both of them wanted to bring original and good quality beauty products to their regions, retail stores established their authenticity and the quality of their products. It also helped improve trust and brand recognition.
Both of them utilized influencer engagement on social media to gain traction for their platform. Nykaa and Sociolla leveraged celebrities, models and other social media influencers for their product launches and to increase the popularity of their campaigns.
Nykaa collaborated with Indian celebrity Katrina Kaif for the launch of her beauty line Kay Beauty and invited influencers and bloggers for the launch. Sociolla also teamed up with BLP Beauty, an Indonesian lipstick brand, to market their lipsticks through influencers on social media. Thanks to the extensive influencer marketing, more than 4,000 lipsticks were sold in under two hours.
Influencer marketing is not just huge in Indonesia, but in China as well. Li Jiaqi, an influencer touted to be the Lipstick King, sold 15,000 lipsticks in 5 minutes during China’s 11.11 sale.
Beauty Book VS Beauty Journal
The names seem very similar and a major portion of the content is pretty much the same – makeup tutorials, how-to videos, product reviews, etc.
Beauty Book by Nykaa is exclusively focused on beauty content, especially products that are available on Nykaa’s website – grooming advice for men and women, tips and tricks, and even health and wellness content such as weight loss, pregnancy and diet.
Sociolla on the other hand has a completely separate website called Beauty Journal which doesn’t just cater to beauty content but lifestyle content as well. From celebrity gossip to makeup inspiration to viral content, Beauty Journal has the tee about all the happening topics. Budding Cosmopolitan in the making? Sure seems headed that way.
Nykaa Network VS SOCO
At the outset, both of these platforms aim at creating a community where people can exchange their ideas, thoughts, post pictures about products or tutorials and ask questions and doubts about makeup or any other topic.
However, SOCO, short for Sociolla Connect, takes it a step further. Integrated with Sociolla and Beauty Journal, it is like a social media platform focused on beauty-related activities. Users have tailored profiles based on which they can get personalized recommendations for beauty products. There’s a social feed, just like Instagram, where you can see posts from people you follow, trending articles and videos, and of course, write articles, reviews, and post photos and videos.
Nykaa has already taken steps towards its expansion plans by foraying into the fashion industry. There is stiff competition from players like Flipkart, Amazon and Myntra in India, so only time will tell if Nykaa’s fashion expedition will turn out successful.
Sociolla, on the other hand, plans to remain focused on the beauty industry and according to the company, they aspire to develop a ‘digital beauty ecosystem’ in Indonesia. Their first step towards this aspiration is through an integrated account across their different platforms, but is it just a publicity term or is there any substance behind it? The next steps they take towards this beauty ecosystem will determine its fate.