Trent, led by Noel Tata, has introduced a new shop concept called “Zudio Beauty,” going up against Elle18, Sugar Cosmetics, Health & Glow, and Colorbar in the mass-market beauty industry.
In contrast to firms like Reliance, Nykaa, and Shoppers Stop, which concentrate on premium and luxury areas, Zudio Beauty seeks to satisfy the demand for reasonably priced beauty items.
Tata Group Launches Zudio Beauty
Bengaluru is home to the first Zudio Beauty store, with plans to build more in Hyderabad, Pune, Gurugram, and other cities.
Tata, having pioneered Lakme (India’s first beauty brand, later acquired to Hindustan Unilever), is leveraging experience in the beauty business, including establishing Tata Cliq Palette, a luxury cosmetics retail concept.
Trent’s low-cost clothing line, Zudio, debuted in FY17 and has since expanded quickly because to its unique designs. It has a low gross margin of 35–40% while attaining great retail efficiency.
Zudio became a separate format in FY18 and currently accounts for more than one-third of Trent’s overall income with a revenue per square foot of Rs 16,300, double the industry average.
Zudio Exceeds Westside in FY22
Zudio exceeded Westside in terms of the number of stores by FY22, and in terms of sales by FY24.
With 559 Zudio locations as of June and plans to open more, the brand has established itself as a leader in the discount retail space. Trent is anticipated to achieve similar success in the cosmetics industry.
The executive director of Nuvama, Abneesh Roy, applauded Trent for his bold decision and pointed out that Zudio Beauty can be a huge success if customers find value in the product.
This action would put fast-moving consumer goods (FMCG) companies and competitors like Nykaa under pressure, which could have an impact on their market share.
Global cosmetics conglomerates such as L’Oreal and Shiseido regard India as a crucial developing market; L’Oreal has identified India as their fifth-largest professional product market.
With Shoppers Stop, Shiseido is bringing its high-end Nars Cosmetics brand to the Indian market.
Specialty beauty companies, such as L’Oreal, Mama Earth, Nivea, and Nykaa, currently enjoy a 33% market share, but are expected to increase to 42% over the next five years, according to a Redseer Strategy Consultants and Peak XV analysis.
By 2027, the total market share of established players such as Hindustan Unilever and Procter & Gamble might drop by 900 basis points to 58%.
Even though Zudio already has more than 550 locations, experts at Citi Research believe the company has substantial development potential and that more expansion into the beauty market is likely.
