Tata CLiQ, a B2C e-commerce company operating under the banner of Tata Unistore Limited, functions

across the categories of Luxury, Lifestyle and Electronics. Launched in May 2016, the company runs on
an omni-channel marketplace model that leverages the extensive store network available with brands. An
organization that’s guided by values, Tata CLiQ’s core principle was to build a digital platform that best
represents the brands and their collection. The key tenets that the company believes in and abides by in
day to day decisions are as follows:

• Tata CLiQ obsesses over customer delight

• At Tata CLiQ, brands are treated as symbiotic partners and key stakeholders
• Tata CLiQ pledges to innovate to find an alternative e-commerce experience that speaks to the audience
that prioritizes trust, stories, brands and new launches as much as its value
• Tata CLiQ will never compromise trust in pursuit of commercial advantage
• Tata CLiQ aims to build a business that is meaningful for all our stakeholders (customers, brands and
shareholders) and makes long term economic sense
• Tata CLiQ cares about people and emotions as much as it does about business and its outcomes.

Tata CLiQ has witnessed a tremendous revenue growth YoY in the last three years (almost 2.5x-3x Y-o-Y)
together with a considerable improvement in the net P&L profile. With a vision to become a significant
player in the e-Commerce landscape, Tata CLiQ’s annual GMV is a good (1200Cr) and thus the company
looks forward to growing at an exponential rate in the near future.

Key milestones in the journey of Tata CLiQ:

• Tata CLiQ launched (May 2016)

• Launch of various categories - Footwear, Apparel, Mobiles and Large Appliances (Jun-Oct 2016)
• Launch of the Luxury and Kids Category (Oct 2017)
• Launch of Jewellery category (2018), Home (2020) and Eyewear (2020)
• Indi Luxe launched on Luxury (Oct 2018)
• Luxury becomes operationally profitable (Jul 2019)

The above-mentioned milestones clearly depict the growth curve of Tata CLiQ. And on these grounds, the
organisation is willing to step into the Beauty category.
The following segment speaks about the problems at hand in this regard and seeks solutions from the
students for the company’s go-to-market plan for the said category.

Tata CLiQ - Stepping into the Beauty Category

The pandemic has influenced the way consumers shop. With in-person shopping becoming a task for most
people, with the perennial fear of coming in contact with the virus, consumers would increasingly prefer
shopping from the comforts of their own home.

Tata CLiQ has been at the forefront of launching new categories which reach out to customers by adding
value and a differentiated proposition. Beauty is one such category that has extreme relevance in the
current scenario, having piqued the interest of customers. With the pandemic still looming over,
customers would be hesitant to go to stores, try out samplers or use the assistance of in-shop experts. E-
Commerce, thus, becomes a natural choice for selling these products. It is also an area which demands a
great deal of personalization, customer knowledge - be it in preferences or patterns, or other finer details
like skin tones, knowledge of pigmentation, pores, etc., that makes it a challenge to sell such products
online.

Expectations from the participants

Tata CLiQ aims to enter the Beauty category super soon and is now looking for a go-to-market plan to
step into the said category.

• How do we differ from the competitors with respect to content, product features, and other key factors?
• What would be the value proposition?
• What should the business model be – inventory led, pure-play market place, omni-channel, or a
combination of them all?
• What would the category/brand assortment plan be like?
• What would be the 1-5 year financials for the category?
• What will be done differently for customer experience and engagement?
• What will be the Go-to-market strategy – marketing plan, communications plan?
• What response should we expect from the competitors?

Please Note: The judges will focus on innovation and how teams think and plan to make the business
profitable, scalable and different.
Addendum Readings

Beauty - A sizeable market

In India, the cosmetics and personal care industry is known to be one of the fastest-growing consumer
products sectors that has a strong potential for foreign companies. Having witnessed considerable growth
in the last few years, the sector has increased shelf space in retail stores and boutiques in the country to
stock cosmetics from around the world.

In recent years, the growth of the cosmetics and beauty products industry in India has been quite steady.
Primarily categorised under five major categories of body care, face care, hair care, hand care and colour,
the Indian beauty and personal care industry is estimated to be worth USD 8 billion. In addition, India’s
per capita spend on beauty and personal care products is growing steadily and in line with the country’s
GDP growth.

In all, the market is noticed to be growing towards premiumization, where the figures state the premium
segment to be growing at 6.3% in comparison to the 1.1% growth rate for the mass market.

Key factors to be noted here are:

• INR 87k Cr market growing at 10% till FY25

• Organized expected to be INR 182k Cr by FY30 - growth at about 1.8x overall
• Online market to become 8x by FY25

Discretionary is particularly attractive

Beauty and cosmetic products are categorized under the umbrella of consumer discretionary products.
Consumer discretionary essentially refers to the goods that are classified as and considered non-essential
by consumers but are nevertheless desirable if their income allows them to purchase the said item/s.

Influenced by the cycles of the economy, the purchase of products that are termed as consumer
discretionary is often discussed in comparison with its counterpart consumer staples.

In this respect, the following interesting insights have come to light:

• Discretionary products are growing at 1.8x of Essential

• Currently 32% of the overall market (58% in Indonesia and 75% in China)
• ‘Skin and sun care’ products are emerging to be the largest players
Fragmented Market - No single large player

Apart from all the other factors, the beauty industry is largely fragmented and can even be called
unorganized. This goes to say that no single player dominates the industry and a number of companies
own a small share of the market. In India, where the industry of beauty and cosmetics products is growing
at a rapid pace, this fact can be put to use by grabbing the attention of consumers with a strategy that
encourages the launch of a platform that has the capacity to supersede all other companies currently
governing the market.

Noteworthy insights in this regard are as follows:

• The overall leader Nykaa is known to have only a 2% share of the industry
• Beauty Specialists are growing at a tremendous rate
• India is under-indexed in Specialists with about 6% share in comparison to a 15% share of Indonesia
and an 11% share of China

Category conducive to an online play

Beauty products, in the last few years, have witnessed enormous innovations that today make this
industry stand amongst the fastest growing sectors. But there’s one thing that has stayed constant - the
products are still primarily sold the way they have always been - in stores. Sceptical to the online shift of
the products that largely depend on colour, texture, usage, skin tone amongst many other factors, people
still largely rely on offline products.

But with a pandemic hovering above our heads, we have all been made accustomed to the usage of online
shopping. This has given a leeway to the beauty and cosmetics industry, giving it an opportunity to
expand itself digitally.

Key highlights that support this argument are as follows:

• High repeat rate (approx. 70%) which reduces CAC

• High units per transaction (approx. 4 units)
• Low returns (6% in comparison to about 17% in Lifestyle)
• Online content is crucial to sell beauty products
Consumers still face pain points

Despite the consumer’s inclination towards offline stores for buying beauty and cosmetic products, the
pain points faced by customers still exist. Where, many a time, stores run short of the bestseller products,
at other times, visiting an offline store might altogether be a problem (the pandemic, for instance). This
issue has been dealt with by online retailers by ensuring the availability of products at all times, in
addition, to the multitude of choices offered.

Also, online retailers now offer the option of personalization that comes as an added feature for customers
who often are in a dilemma about buying a particular beauty or cosmetic product.

The following points must be noted here:

• “Don’t know what’s suitable for me” is the top pain point
• Top global brands and retailers are using personalization to solve this
• Personalization is still very nascent in India

Attractive for an ecosystem play

Tata CLiQ holds a relevant position in the space of online retail and e-Commerce, especially when it
comes to selling products of women. In this accord, it is relatively easier for the e-Commerce company to
add another feather to its hat by stepping into the beauty and cosmetics industry.
Through the best Indian and international brands in fashion, luxury, electronics and jewellery, Tata CLiQ
is known to provide a seamless online shopping experience to its customers. This makes it an even more
attractive player in the industry, making it stand amongst the e-Commerce giants that have the potential to
bring about a change.

Here’s why we believe it’s the right time for us to step into this sector:

• Tata CLiQ is one of the strongest recruiters of women customers

• Loyalty programs have been very successful
• Cross-category sales is quite strong with other lifestyle categories

GOOD LUCK!