Starting A D2C In Today's Tech-driven World Is Manageable Makker cites scaling and ensuring sustained growth challenging
By Deepa Vaidya
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Gagan Makker, co-founder, Pilgrim, was always passionate about creating a consumer brand and while exploring business ideas, met his co-founder Anurag Kedia through a common friend in the IIT Bombay Alumni network.
"After a few discussions, brainstorming and market research, we decided to build a digital-first beauty brand with a purpose to make beauty rituals and learnings from across the world accessible to all. And that's how Pilgrim was born," says Makker.
R&D and innovation are at the heart of their organization. From Korean beauty to French vinothérapie, Pilgrim is bringing exotic and powerful ingredients all the way home to millennial consumers.
"We service more than 25,000 pin codes across India and are able to deliver products usually within 24 to 72 hours within placing an order on our website, "" he says.
"Being a digital-first brand allows for direct engagement with consumers at a much higher cost-efficiency than a traditional brick-and-mortar company. Most importantly, we can control and enhance the entire customer experience at all the major touch-points. Being a direct-to-consumer brand helps cut down a few costs and saves time which can be used to focus our efforts on R&D and quality control for our products," says Makker about starting Pilgrim.
"Another factor that helps D2C brands is that there are no forced compromises on things like pricing, marketing, or location. We have a direct relationship with customers and so, we get feedback very quickly. This then helps us create products, packaging, and promotions to serve them better. Ever since the pandemic, people prefer buying online at either a marketplace or from the manufacturer's website itself. So, in a sense, the D2C surge is because it has been a perfect match of the requirements of the buyer and the seller," he shares about the feasibility of starting a D2C brand.
On how the market has evolved from 2019, when the company started and now, says Makker, "The beauty, wellness & personal care industry in India is estimated at INR 80,000 crore and is growing rapidly. This trend has accelerated further in the pandemic. Around 10% of this is online. The online market has been growing between 40%-60% y-o-y and hence in the next couple of years, we expect the online BPC market to be between 15%-20% of the overall beauty market."
Does this make it difficult/easy or start a D2C in India? He says, "In today's tech-driven world, starting a D2C is manageable. But scaling it and ensuring sustained growth is really challenging. There is growing competition in the Indian D2C personal care market with an increasing number of consumers willing to experiment with new products/brands. Here's why finding key growth drivers and executing them at scale plays a pivotal role. The challenges also include acquiring new customers and retaining existing ones at a low cost."
Stating their performance of the past two years, Makker says, "Pilgrim has grown exponentially in the last two years and has launched three international ranges comprising 67 SKUs. We witnessed an Annualized Run Rate of INR 18 crore within a year of our launch and cater to over 75k consumers pan-India. In June 2021, we raised INR 13 crore in a Series A funding round led by Fireside Ventures, Rukam Capital, and the founding teams of Boat, NoBroker, and the founder-CEO of Bewakoof.com."
"We are using the capital primarily to enhance our R&D capabilities, expand our team, and enhance our consumer outreach as well as branding efforts.
He says about how investors add value to their brand. "We benefit greatly when the investors share with us their learnings from different portfolio companies as well as benchmarks across various parameters. The investors also help us think through critical business issues and support us both in good and challenging times."
"Our investors guide us from time to time. However, they're not involved in day-to-day decision-making."
On their future plans, Makker says, "Pilgrim plans to achieve an Annualized Run Rate of INR 120 crore by December 2022 with an NPS of 50+ across all ranges. We also plan to establish an international presence in the next couple of years."
FACTS
- Bestseller: Red Vine Face Cream, Redensyl & Anagain Advanced Hair Growth Serum
- Total SKUs: 67 SKUs across 3 international skincare and haircare ranges.
- Team size: 39 employees
- Repeat customer ratio: M12 Cohort of 75%+
- Online platform resulting in maximum revenue: Amazon and Nykaa are almost at par followed by the Pilgrim website
- Turnover for FY 2021-22: 17.6 crore INR
- Split between offline and online sales: -NA- (We are not available offline currently.)
