The company said that it plans to invest the fresh round of funds in research, sourcing, new product launches and scaling up its distribution network
Pureplay Skin Sciences (India) Pvt. Ltd, which sells direct-to-consumer skin and hair care brands Plum and Phy, has raised ₹110 crore in Series B funding, said CEO Shankar Prasad in an exclusive chat with Mint.
Venture Capital firm Faering Capital has led the round along with Trifecta Capital and existing investor Unilever Ventures.
The company said that it plans to invest the fresh round of funds in research, sourcing, new product launches and scaling up its distribution network.
With over 80 SKUs in its portfolio comprising skin care, haircare, body care and eye makeup, the brand claims to be seeing a 2.5x growth year-on-year. It serves 2,50,000 customers on a monthly basis and aims to hit a revenue run rate of over ₹200 crore by March.
"We intend to invest this money into expanding our product range largely in skincare. We will be partnering with technology specialists in formulations, packaging and manufacturing," said Prasad.
The investment will also be utilised to scale the business by opening more offline retail stores. The brand is currently available in more than 220 cities at 6,000 retail outlets, in addition to 15 online marketplaces which still account for over two-third of Plum’s topline.
"Our distribution is still relatively small. We have grown 2.5 to 3X in distribution terms in spite of covid disruption over the last 12 months. We will be expanding the unassisted selling in the offline stores including beauty specialist stores, modern trade, multibrand outlets (MBOs) such as Shoppers Stop, Lifestyle, Metro Cash and Carry as well as local supermarkets along with chemists," said Prasad.
The company aims to ensure presence of the brand in 100,000 stores in the next two years so that it can achieve ₹500 crore in revenues in the next three years, he said.
In the last six months, most of the D2C brands have managed to generate higher GMVs and sales given the increased digital adoption along with low customer acquisition costs, said Ankur Pahwa, partner and national leader, ecommerce and consumer internet sector, EY India. According to him the challenge with niche brands, which require concept selling, is that scale is not easy to achieve beyond a point, especially online.
"They need adjacent products along with their flagship range of products to pull new customers and expand their basket for better economics and pull through rates. General Trade and pharma are important distribution points, where niche products usually don't find enough shelf space. D2C brands can ensure presence by introducing mass scale products and let consumers sample their niche offerings as well," he added.
In order to familiarise new customers with the concept of clean beauty, the brand will continue to invest in awareness programmes and customer engagement activities online where people actively look for beauty solutions. Prasad said the firm also plan to scale up smaller SKUs to increase sampling.
"It can be as low as 7ml pack in case of a serum, facewash (10 to 15 ml) and shampoo (25ml)," he noted.
The company has rolled out a sampling programmes with ecommerce partners Myntra and Nykaa which will be scaled up further.
"Widespread and rapid digital adoption across India is fueling the growth of sharply focused online brands and Plum is at the forefront of this trend due to the brand’s innovative product portfolio and consumer loyalty. The company is fast growing but at the same is profitable while keeping its clean beauty proposition intact which has made us back it", said Sameer Shroff, co-founder and managing director at Faering Capital, who will join the board of the company.
An IIT-ISB Hyderabad graduate, Prasad founded Pureplay Skin Sciences (India) Pvt. Ltd in 2013 after working with fast moving consumer goods firm Hindustan Unilever (HUL) as well as private equity firm Everstone and consultancy firm McKinsey & Co.