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Celebrities becoming the secret ingredient in beauty business

Social media these days is abuzz with a video of actor Deepika Padukone taking Pathaan co-star Shahrukh Khan through a holistic skincare routine for her skincare brand 82°E. She shares some tips and tricks on skincare, introducing a revitalising toner serum called Gotu Kola Dew, with properties of gotu kola and niacinamide.

Showbiz is all about looking good. But when celebrities turn entrepreneur-cum-investors, endorsing their own products, it doubles the power of the brand, capturing the consumers’ attention.

Hot on the trail of success stories in the past decade, such as Rihanna’s Fenty Beauty, launched in 2017, Selena Gomez’s Rare Beauty, Kylie Jenner’s Kylie Cosmetics, Miranda Kerr’s KORA Organics, India, too, has witnessed a rise of celebrity-owned or invested beauty brands.

Last year, Sonakshi Sinha launched SoEzi, Deepika Padukone founded 82°E and Priyanka Chopra launched hair-care brand Anomaly. Katrina Kaif is in partnership with multi-brand beauty retailer Nykaa since 2019 for her brand ‘Kay Beauty’, while Alia Bhatt invested in IIT Kanpur-backed D2C startup Phool in 2021 and Shilpa Shetty Kundra is one of the early-stage investors in Mamaearth, just to give a few examples of celebrities who have made a mark in the beauty sector.

“Celebrities have the upper hand of fame so when launching a new beauty brand, they’re not building awareness from scratch and can rely on their celebrity status. They also see more success positioning themselves as digital influencers, acting as creative directors and brand owners, and not just the face of the brand,” adds Tanya Rajani, senior beauty & personal care analyst, India Mintel.

“Glamour has a short life span so even a small stake in a brand can increase its valuation. The stock market debut of Nykaa with its market capitalisation crossing `1 trillion, added showbiz at the NSE with Kaif present as business partner and co-owner for the listing ceremony. This was a smart move. They give time and brand value in exchange for brand equity and endorse it. Louis Vuitton signed actor Deepike Padukone to broaden the brand’s presence in the Indian market. Top-end brands set stories and tie up with large retail chains — the two promising factors driving the luxury segment in India,” says business strategist and independent director Lloyd Mathias.

However, as per Mintel’s consumer research survey, only 41% of consumers have chosen celebrities as a trusted source of beauty information, with beauty brands (58%) and e-commerce (53%) leading their choice of trusted sources of beauty information.

“Because of the blurred lines between sponsored and genuine content, a lot of celebrity endorsements face mistrust from consumers, leading to diminishing their appeal to their fan base,” adds Rajani.

As per, India’s beauty & personal care market was estimated at $24.53 billion in 2022 and could reach $33.33 billion by 2027, growing at a CAGR of 6.32%.

Apart from brand ownership, the beauty & personal care (BPC) industry has witnessed immense growth in the recent past that has led to an increased product innovation. “In our research, we learnt that this market has also led to product overload that in turn has led to more confusion in customers’ minds, resulting in the dilution of the focus on the fundamentals,” feels Jigar Shah, co-founder, 82°E, which is actor Deepika Padukone’s newly-launched skincare line.

“For our first category — skincare — we purposefully led with a fundamentals-first approach to design products to simplify skincare routines, emphasise skin hydration and protection which forms the backbone of a good skincare routine,” says Shah.

“We have ambitions to expand into other categories that support a modern, holistic approach to self-care,” Shah tells FE.

As a strong advocate of environment and sustainability, television actor Anita Hassanandani, who is also the co-founder of Better Beauty, incorporated clean beauty to create a brand that reflects her values.

Last year, Better Beauty raised $200,000 from Indian cosmetics giant Lotus Herbals. “We aim to achieve an annual rate of return (ARR) of `7.2 crore this year and expand our product portfolio, increase marketing budget and offline presence nationwide,” says Hassanandani, adding that the idea to endorse a personal brand was to use her expertise in the beauty category and offer a holistic experience for beauty enthusiasts.

But there’s a flip side too. The West has seen a plethora of beauty brands owned and launched by celebrities — and probably reaching saturation. In India, it is still not reached that stage. As per Ajit Narayan, CMO of advocacy brand solution Socxo, the international scene points towards consumer fatigue.

“If every other day a new brand drops on Instagram, there is nothing that’s being innovated in the space and it becomes perceived as just yet another endorsement. In fact, consumers are opting for more niche products which deliver some value over celeb launches. It’s a wake-up call to stop this model. From a market perspective, many celebs know nothing about the category or business and so the shiny new toy syndrome would go only so far,” adds Narayan.



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