FMCG major Emami's chairman RS Goenka said the company has realized the latent potential of new-age startups, highlighting the roles these smaller platforms were playing in educating consumers and making the sector more competitive.
Speaking at Emami's 39th annual general meeting (AGM), Goenka referred to direct-to-consumer startups' business models. "Your company (Emami) is nimble enough to capitalise on this consumer transition towards convenience-driven platforms. With an overall focus on digital business, we are now increasingly looking at D2C and eB2B segments," he said.
Emami has invested in two startups – D2C brand TruNativ and petcare brand Fur Ball Story. The Kolkata-headquartered conglomerate acquired a 20.65% stake in TruNativ F&B Pvt. Ltd, which retails products under the TruNativ brand. The company picked a 30% stake in Cannis Lupus Services India Pvt. Ltd, which operates Fur Ball Story.
The company has also increased its stake in vegan cosmetics brand Brillare Science and men’s grooming brand The Man Company. In Brillare Science, the company has increased its stake to 77.53% from 34.70%. On the other hand, it increased its stake in The Man Company to 50.40% from 33.09%.
The company launched D2C websites for three of its own brands: Zandu, Kesh King and BoroPlus. In the financial year 2022, the company launched and marketed a range of e-commerce-specific products and digital-first brands like Onion Range under Kesh King, Gold and Therapy range under Navratna and more than 20 healthcare products under the Zanducare D2C platform.
“Our e-commerce revenue doubled and contributed 5.5% to our domestic business in FY22 as against 2.8% in the previous year,” Goenka said. “Through digital and social media, FMCG companies like us have a ready ground intelligence and are constantly launching new products developed using insights and customer feedback from these platforms, where consumers are constantly looking for innovation.”
Indian D2C market is currently pegged around $1.9 billion, according to a white paper published by Technopak. The segment is likely to grow to $22 billion by FY25 to contribute to more than 10% of the domestic FMCG, home and consumer accessories market.
A few Indian D2C brands such as Mamaearth, MyGlamm, and Licious turned into unicorns, a startup valued at $1 billion or more. Also, players like Nykaa have made a successful public debut.
