# Digital-First Beauty Brands Expand into Physical Retail Stores in India Online-native beauty companies are aggressively targeting neighborhood stores to capture broader consumer segments. - **Source:** [mint - industry](https://www.livemint.com/rss/industry) - **Published:** 2026-11-11 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/3e30c6d8-5a0c-48d9-b44f-fa281afb7cfa ## Strategic Shift to Offline Digital-first beauty brands in India are increasingly pivoting toward physical retail to reach customers who prefer traditional shopping. While e-commerce remains a core channel, companies like Honasa Consumer, Nykaa, and Plum Goodness are expanding into neighborhood stores. This move aims to capture the vast majority of the beauty market currently served offline. ## Market Dynamics and Growth India's beauty and personal care market is projected to reach $40 billion by 2030, growing at a 12% CAGR. Currently, online channels account for only 20-25% of total sales, with quick commerce contributing a minor 3-5%. This leaves significant untapped potential for digital-native brands to scale through physical distribution networks. ## Honasa Consumer's Retail Reach Honasa, owner of Mamaearth, reported a 40% year-on-year increase in general-trade secondary sales during the September quarter. The company expanded its reach to approximately 3.2 lakh retail outlets. Modern-trade offtake also grew by over 40%, while average secondary sales per retailer rose by more than 30%, signaling strong demand for their products. ## Nykaa's Physical Store Expansion Nykaa, originally an online-only retailer, recorded over 20% like-for-like growth in its beauty retail business. The company added 14 new stores, bringing its total network to 338 locations across 111 cities. Furthermore, its B2B distribution arm, Superstore, expanded its retailer base by 27%, now serving more than 500,000 retail partners across the country. ## Plum Goodness Retail Strategy Plum Goodness currently generates 25-30% of its revenue from physical channels, maintaining stability despite rapid expansion. The brand is present in 50,000 general-trade outlets and up to 9,000 modern-trade stores. Founder Shankar Prasad noted that there is still significant headroom for growth within the general trade segment as consumer preferences for transparency increase. ## Targeting Tier-2 Markets Analysts suggest that tier-2 cities and smaller markets offer the strongest traction for digital-first beauty brands. In larger tier-1 cities, e-commerce already handles the bulk of reorders for familiar brands. Consequently, physical stores in smaller regions are becoming essential hubs for product discovery and trial among new, less digitally-connected consumer segments. ## Profitability and Operational Efficiency The expansion into physical retail coincides with improved profitability for major players. Honasa’s Ebitda margin rose to 12.7% from 8.9%, while Nykaa’s increased to 8.7% from 6.8%. Both companies attributed these gains to a combination of optimized channel mixes, better operating leverage, and various cost efficiencies implemented throughout the recent fiscal period. ## Future Execution Challenges The next phase of growth depends on matching distribution capabilities with local demand. Brands must be selective about where they advertise offline compared to the broader reach of e-commerce. Success requires building reliable supply chains to ensure that physical shelf space translates into consistent sales without overextending operational capacity in new territories. ## Sources covering this story - https://www.livemint.com/industry/online-beauty-brands-find-their-feet-in-neighborhood-stores-11794292141820.html — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._