Forest Essentials is an authentic, traditional skincare brand with its foundation in Ayurveda. Over its two-decade long journey, the brand has come a long way from just 50 soaps made by squeezing fresh honey for friends and family to its partnership with the Estee Lauder Companies in 2008, making it the first Indian brand in the global beauty brands roster.
Today, Forest Essentials is the largest player in the luxury hotel amenities and spa business, catering to over 500 hospitality chains and retailing from 100 exclusive stores operational in 29 cities across the country. It has a major online business, and exports to over 120 countries. It is also poised to be the first luxury Indian skincare brand to go global. In October, it made its debut in the UK and is now available exclusively on Looksfantastic.com, Europe's leading online beauty retailer.
The company reported net revenues of over Rs 253 crore in 2020, an increase of over 25 per cent compared to the previous year, and aims to become a billion-dollar brand. Business Today spoke to Forest Essentials Managing Director Samrath Bedi on the impact of the pandemic on the business, bounce-back, expansion plans and trends in skincare. Here are the edited excerpts:
How did the pandemic impact business?
As India witnessed a second wave of Covid-19 and went into one of the strictest lockdowns this year, we as a company were particularly affected given most of our business is consumer facing.
While our online business has increased substantially, with regard to stores being shut, as the country begins to open up, we can now see some level of normalcy. We have always been confident about our offline business. While many companies downscaled and reduced their number of stores and retail presence, we as a brand, have taken decisions where we actually increased our retail exposure. We found that the pandemic gave us an opportunity to open stores in several more locations and cities at better rents and because of the confidence in our brand and what we bring to the table, we have strongly expanded our business both offline and online.
Recognising the need for quicker online deliveries, the brand has expanded its warehouse footprint to all the major metro cities to offer same day or next day deliveries to most of its customers.
A significant trend that we have noticed since the onset of the pandemic is that consumers are no longer ignorant of manufacturing processes and are rethinking and re-prioritising their consumption patterns to become more responsible towards society and the environment.
Additionally, the raised awareness around human rights and climate change has led consumers to be more selective and demanding of business practices by prioritising brands that value transparency and are purpose-led in their messaging and authenticity. Moreover, customers are looking for carefully curated and thought-out retail experiences that are distinct while being efficacious. There has been an increased emphasis on personalised products that work to target an individual's specific skincare needs.
How has growth been in the first two quarters of the current year? Are you back to pre-pandemic levels? If not, what is the expectation?
We as a brand increased our retail presence amidst challenging times and actually opened 21 new stores between the period of July 2020 and August 2021. Our brand market share was 30 per cent pre-Covid. This is for the prestige/luxury Ayurveda segment. Now our brand market share is higher given we have opened a number of stores and also grown the online business significantly. Our year-on-year growth post-Covid (last two years) would be about 40 per cent.
There has been a growth of +17 per cent over the last year in total sales. This is inclusive of all verticals including FFS (Free Standing Stores), sales from the French multinational chain Sephora, e-commerce, travel retail and institutional sales.
Our online sales via e-store/website have grown exponentially in the last year with an approximate 300 per cent jump from May 2020 till date. 52 per cent of our customers are repeat consumers who typically place an order every month. 70 per cent of our website visitors are new visitors who contribute to 48 per cent of the business, where on an average, a customer is adding more than one full size product.
What are the new trends in luxury skincare? Have you seen demand for certain products go up during the pandemic?
Today's consumer is actively embracing purpose and sustainability-driven products in a conscious effort to support environmental causes.
With people spending more time indoors, there was a sharp rise in the demand for skincare and especially wellness products, predominantly products that are "clean" -- non-toxic, unadulterated and manufactured without parabens, sulphates and other harmful ingredients.
With the onset of the pandemic, customers are looking for carefully curated and thought-out retail experiences that are distinct while being efficacious. There has been an increased emphasis on personalised products that work to target an individual's specific skincare concerns. In tandem with that, we have witnessed a shift in the beauty space with an increased focus on skincare as a product category, with a simultaneous rise in skincare-infused makeup, a new category that we were thrilled to foray into in December 2020.
What are your expansion plans?
We have a strong network of over 100 standalone stores across 29 cities in India with our standalone store presence growing each year. We service our customers across the globe through our e-commerce website. Our global expansion has begun with the UK this year, and we are looking at expanding to the Middle East, South-East Asia and United States in the next few years.
You have recently launched online in the UK? Why was the UK selected as your first international market?
The beauty industry in India and in the UK have a familiar approach to beauty, with people from both countries being selective and discerning with their choices and investments, prioritising brands that value transparency and ethics. These are values we have pioneered since our inception, making the UK the ideal first choice of our international foray.
Will you be opening a store there?
The drastic rise in online consumption and by leveraging the power of our digital ecosystem, we took the strategic decision of launching through an e-tailer in the UK. To this end, we will be launching digitally with Europe's number one online premium beauty retailer, Look Fantastic in October 2021. Look Fantastic belongs to The Hut Group, which recently bought over Cult Beauty, adding to the Group's meteoric rise.
Carrying over 22,000 products with complimentary worldwide shipping to over 200 countries, Look Fantastic has become the online partner of choice for many leading brands. With a portfolio of over 660 premium brands onsite and revenue shares growing 40 per cent year-on-year in the last four years, launching Forest Essentials on one of the most successful beauty websites globally was keeping in line with our brand's strategic international expansion plans. We will take our learnings from this and look at opening stores physically a year or two down the line.
Are you looking at introducing a new range of products?
Our iconic product ranges across facial care, hair care, body care, men's collection as well as an extensive gifting range will be available for purchase in the UK. This will include our innovative Soundarya collection, crafted with 24 karat gold. Other signature collections offered on the site include the Madurai Jasmine & Mogra, Oudh & Green Tea, Kashmiri Nargis, Sandalwood and Indian Rose Absolute.
In terms of product offerings for the UK market, we are stocking all our key collections and iconic products. Our first objective is to establish Forest Essentials as a luxury beauty brand within the UK market, and thereby internationally. In that regard, we are launching in a two-phased approach by introducing our product range in stages and launching our much-loved Natural Makeup Collection in the next phase.
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