Lakmes Market Share Continues to Soar

Lakme Overview

Introduction to Lakme

Lakme, a renowned beauty brand, has firmly established itself as a leading player in the Indian cosmetics market. Since its inception in 1952, Lakme has been synonymous with beauty and fashion. The brand is known for its wide range of products catering to various beauty needs, including skincare, makeup, and haircare. Lakme has successfully carved a niche for itself by offering innovative and high-quality beauty solutions.

Market Share of Lakme

Lakme commands a significant market share in the Indian beauty and cosmetic industry, making it one of the top players in the market. As of 2021, Lakme holds a market share of over 15% in the Indian beauty and cosmetic market (OSUM blog). This places Lakme in close competition with other leading beauty brands in India, such as L’Oréal, Maybelline, and Colorbar.

In specific segments of the beauty industry, Lakme has achieved remarkable market share. For instance, in the skincare industry, Lakme holds an impressive market share of 20%, positioning it as one of the dominant players in the skincare market (OSUM). Furthermore, in the Indian facial makeup market, Lakme’s market share has steadily increased from 27% in 2007 to an impressive 40% in 2019 (SSRN).

It is worth noting that Lakme’s market share in the cosmetics segment stands at approximately 7%, solidifying its position as a significant player in the industry. This market share places Lakme in competition with other prominent cosmetic brands, highlighting its influence and presence in the market.

By consistently offering innovative products, keeping up with changing beauty trends, and targeting the diverse beauty needs of Indian consumers, Lakme has secured a strong market share in the beauty and cosmetic industry. With its continued growth and market presence, Lakme remains a trusted and sought-after brand for beauty enthusiasts across India.

Lakme Strengths

Lakme, a prominent player in the cosmetics industry, possesses several strengths that contribute to its success. These strengths include a diverse product portfolio, a strong brand presence, and consistent financial growth and performance.

Diverse Product Portfolio

Lakme boasts a diverse product portfolio that spans across various beauty categories, from skincare to makeup. This extensive range enables the brand to cater to different consumer needs and preferences, capturing a wide market segment in the beauty industry. By offering a comprehensive selection of products, Lakme ensures that customers can find the right beauty solutions for their specific requirements. This versatility contributes to the brand’s popularity and helps maintain its market share.

Strong Brand Presence

With a long-standing presence in the market, Lakme has established itself as a trusted and reputable brand. It holds a significant market share of 26% in the Indian cosmetics market, making it a key player in the industry (Scribd). The brand’s longevity and consistent delivery of quality products have earned the trust and loyalty of consumers. Lakme’s strong brand presence is further reinforced by its association with beauty pageants and fashion events, solidifying its position as a leading beauty brand in India.

Financial Growth and Performance

Lakme’s financial growth and performance reflect its strong market presence and consumer demand. The company has experienced a steady increase in revenue over the years, with a commendable year-on-year growth rate of 10% (OSUM). This growth indicates the brand’s ability to adapt to changing consumer preferences, innovate its product offerings, and effectively meet market demands. Lakme’s consistent financial performance not only solidifies its position in the beauty industry but also allows for further investment in research, development, and marketing strategies to maintain its competitive edge.

By capitalizing on its diverse product portfolio, strong brand presence, and impressive financial growth, Lakme has successfully secured its place as a leading brand in the cosmetics industry. These strengths contribute to its market share and enable the brand to cater to the needs of its target audience effectively.

Lakme Weaknesses

Every brand has its strengths and weaknesses, and Lakme is no exception. In this section, we will explore two key weaknesses that Lakme faces in the market.

Market Share in Cosmetics Segment

While Lakme holds a significant position in the beauty and cosmetic industry, its market share in the cosmetics segment is relatively moderate. According to OSUM, Lakme holds a market share of about 7% in the cosmetics segment. Although this is a notable share, it indicates that there is room for growth and improvement in capturing a larger portion of the cosmetics market.

However, it’s important to note that Lakme’s market share in the Indian facial makeup market has been steadily increasing. According to a study by SSRN, Lakme’s market share in the Indian facial makeup market grew from 27% in 2007 to 40% in 2019. This growth demonstrates Lakme’s potential to expand its market share in specific segments within the cosmetics industry.

Website Traffic and Engagement

While Lakme enjoys a strong brand presence, its website traffic and engagement metrics present an area of improvement. According to SimilarWeb, Lakme India’s website, lakmeindia.com, receives an estimated 1.5 million visits in the last 28 days. However, the website has a bounce rate of approximately 59.67%. This indicates that about 40% of visitors navigate to other pages on the site after viewing the initial page.

To further enhance website performance, Lakme should focus on improving engagement metrics and reducing bounce rates. Implementing strategies to increase user engagement, such as optimizing website content, enhancing user experience, and providing valuable information, can help capture and retain visitor interest.

Additionally, Lakme can leverage its digital presence to drive more traffic to its website. As per SimilarWeb, search engines contribute to about 65.85% of the total traffic to Lakme India’s website, with the majority coming from organic search. This highlights the importance of search engine optimization (SEO) to improve visibility and attract organic traffic. Furthermore, Lakme can also leverage social media platforms, which contribute to about 11.82% of the total website traffic, to increase brand awareness and redirect users to their website.

By addressing these weaknesses and implementing strategic measures to improve market share in the cosmetics segment and enhance website traffic and engagement, Lakme can strengthen its position in the beauty and cosmetic industry.

Lakme Opportunities

As a prominent player in the beauty and cosmetics industry, Lakme has identified several opportunities to further strengthen its position and expand its market share. By capitalizing on these opportunities, Lakme can continue to grow and thrive in the ever-evolving beauty market.

Collaboration with Influencers

Lakme recognizes the power of influencer marketing and has successfully leveraged collaborations with influencers to promote its products and brand. By partnering with influencers, Lakme can tap into their extensive reach and impact, effectively reaching a wider audience and enhancing brand awareness (Ylytic Blog). Influencers can create content featuring Lakme products, share their experiences, and provide recommendations, which can significantly influence consumer purchasing decisions. This strategy allows Lakme to connect with their target audience on a more personal level and build trust and credibility.

Expansion into Men’s Grooming

While traditionally the beauty and cosmetics industry has primarily focused on women, there is a growing demand for grooming products and services for men. Lakme Salon has recognized this opportunity and has partnered with Bombay Shaving Company to expand into the men’s grooming space. They have created dedicated men’s zones across 200 Lakme Salons, providing specialized services that cater to the grooming needs of men. This strategic move allows Lakme to tap into a previously untapped market segment and diversify its offerings.

Leveraging Digital Presence

In today’s digital age, having a strong online presence is essential for any brand. Lakme Salon has recognized the importance of digital channels and has developed a robust digital presence through its websites and social media channels. They have effectively utilized technology to provide customized solutions to their customers, such as virtual consultations and personalized phone calls, particularly during the pandemic when in-person salon visits were limited. This digital approach not only allowed Lakme to stay connected with their customers but also enabled them to recommend home care regimes and build a stronger relationship with their audience.

By collaborating with influencers, expanding into the men’s grooming market, and leveraging its digital presence, Lakme can maximize its potential and capitalize on the opportunities available in the beauty and cosmetics industry. These strategic moves will enable Lakme to reach new audiences, strengthen its brand image, and continue to thrive in a highly competitive market.

Lakme Threats

In the competitive beauty and cosmetic industry, Lakme faces certain threats that can impact its market share and growth. Two main areas of concern for Lakme are competitor market share and challenges in the salon industry.

Competitor Market Share

Lakme operates in a highly competitive market, contending with other well-established beauty brands such as L’Oréal, Maybelline, and Colorbar. As of 2016, Lakme held a market share of 26% in the Indian cosmetics market, while its competitors had varying market shares. However, it is important to note that market dynamics may have changed since then.

To maintain its position and counter the threat of competitor market share, Lakme must continuously innovate and adapt its marketing strategies to effectively target its audience. By understanding consumer preferences and trends, Lakme can develop new products and services that cater to evolving beauty needs. Strategic collaborations and partnerships with influencers can also help in expanding brand reach and visibility (Ylytic Blog).

Challenges in the Salon Industry

The salon industry has its own set of challenges that can impact Lakme’s business. The COVID-19 pandemic, for instance, has disrupted the salon business worldwide, forcing temporary closures and affecting customer footfall. Despite these challenges, Lakme Salon was able to retain the faith of its business partners due to its franchise model and strong brand reputation.

Lakme Salon has leveraged technology and its strong digital presence to stay connected with customers during the pandemic. Virtual consultations and personalized recommendations for home care have helped bridge the gap and maintain customer engagement. Expanding the franchise model to Tier I, II, and III cities has also allowed Lakme Salon to increase its market reach and tap into new customer segments.

By addressing the challenges in the salon industry head-on and adapting to changing circumstances, Lakme can mitigate the impact of these threats and continue to thrive in the market.

SWOT Analysis of Lakme

To gain a comprehensive understanding of Lakme’s position in the beauty and cosmetic market, a SWOT analysis can be conducted, highlighting the company’s strengths, weaknesses, opportunities, and threats.

Strengths and Weaknesses

Lakme, one of the leading beauty brands in India, possesses several strengths that contribute to its success in the market. These include:

1. Diverse Product Portfolio: Lakme offers a wide range of products, spanning skincare, makeup, and hair care, catering to various consumer needs and preferences in the beauty industry. This diverse product portfolio allows Lakme to capture a larger market share and appeal to a broad customer base.

2. Strong Brand Presence: Lakme has established itself as a trusted brand in the Indian beauty market, enjoying a strong brand presence and recognition. With years of experience and a reputation for quality, Lakme has gained the trust and loyalty of consumers, positioning itself as a go-to brand for beauty products and services (OSUM).

3. Financial Growth and Performance: Lakme has demonstrated financial growth and performance, with its sales revenue increasing by 19.3% to Rs 328 crore in FY23. This showcases Lakme’s ability to thrive in the competitive beauty market and indicates its strong market position (Ylytic Blog).

Despite its market strengths, Lakme also faces certain weaknesses that could potentially hinder its growth and market share:

1. Market Share in Cosmetics Segment: While Lakme holds a significant market share of over 15% in the Indian beauty and cosmetic market as of 2021, it faces tough competition from other established brands like L’Oréal, Maybelline, and Colorbar. This competitive landscape presents a challenge for Lakme to retain and expand its market share.

2. Website Traffic and Engagement: Lakme’s online presence, including its website traffic and engagement, could be areas for improvement. Enhancing its digital marketing strategies and optimizing its online platforms can help drive more traffic to its website and increase user engagement, leading to improved brand visibility and customer conversion (OSUM blog).

Opportunities and Threats

In addition to its strengths and weaknesses, Lakme can explore various opportunities and must navigate potential threats in the market:

1. Collaboration with Influencers: Lakme can leverage the power of influencer marketing by collaborating with popular beauty influencers and celebrities. Partnering with influencers can help increase brand visibility, reach a wider audience, and enhance brand credibility and customer trust (OSUM blog).

2. Expansion into Men’s Grooming: The men’s grooming market presents a significant opportunity for Lakme to expand its product offerings and market reach. By creating dedicated men’s zones within its salons and partnering with established brands in the men’s grooming sector, such as the collaboration with Bombay Shaving Company, Lakme can tap into this growing market segment.

3. Leveraging Digital Presence: Lakme can further leverage its strong digital presence by adopting innovative digital marketing strategies and technologies. By staying connected with customers through virtual consultations, personalized recommendations, and customized home care regimes, Lakme can enhance customer engagement and loyalty, particularly during challenging times like the COVID-19 pandemic (Indian Retailer).

While Lakme has opportunities for growth, it also faces potential threats in the market:

1. Competitor Market Share: Lakme operates in a highly competitive market, facing strong competition from both domestic and international beauty brands. Competitors such as L’Oréal, Maybelline, and Colorbar pose a threat to Lakme’s market share. To maintain its position, Lakme must continuously innovate and differentiate its products and services.

2. Challenges in the Salon Industry: The salon industry faces challenges such as logistical issues and changing customer preferences. Lakme must stay ahead of these challenges by adapting to evolving trends, maintaining quality services, and continuously improving customer experiences to retain its position as a leading salon brand (Indian Retailer).

By conducting a thorough SWOT analysis, Lakme can capitalize on its strengths and opportunities, address its weaknesses, and mitigate potential threats. This analysis provides valuable insights for strategic decision-making and helps Lakme maintain its market share and position in the beauty industry.