NYKAA: TIME TO REDEFINE CUSTOMER EXPERIENCE
CASE STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
Nykaa E-Retail Limited (Nykaa) has come a long way since its founding in 2012 by Falguni Nayar in
Mumbai, India, establishing itself as a prominent participant in the e-commerce and retail industry. Not
only has Nykaa revolutionized the field of online shopping in India for beauty and personal care products,
but it has also played an essential role in the development of an ecosystem within that field. Nykaa has
n
curated an offering of assorted beauty products spanning a variety of categories, including make-up,
skincare, haircare, bath and body, fragrance, grooming equipment, personal care, and health and wellness.
tio
The company offers an enormous selection of over 2,400 legitimate brands. Nykaa has been able to maintain
consistent growth because of its unrelenting concentration on the requirements of its customers and its close
working relationships with other companies. However, feedback and reviews from customers have
lu
indicated a disconnect between client expectations and Nykaa’s performance. An increase in customer
complaints, encompassing technical issues and problems related to customer assistance, exchanges, returns,
So
and refunds—essentially, the entire customer experience—is revealing opportunities for improvement.
Nykaa’s leadership has expressed concern over the increasing number of incidents of consumer
dissatisfaction, an issue that is coming to light amid an increasingly competitive digital landscape.
OBJECTIVES
• Understand the growth drivers in the beauty and personal care industry.
• Understand and apply the customer buying behaviour model from an e-commerce perspective.
• Understand and analyze service quality by applying the gap model of service quality.
• Be able to apply the service recovery paradox.
• Analyze the role of technology in enhancing the customer experience.
The Case Solution Starts From page 6
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pl
ASSIGNMENT QUESTIONS
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1. What are the key drivers in the beauty and personal care industry in India?
Sa
2. How does a customer make a purchase through e-commerce websites/apps?
3. What gaps exist between Nykaa customers’ expectations and their actual experiences while making
purchases online?
4. Considering Nykaa’s recent challenges, how can the company strategically utilize effective service
recovery techniques to not only address these issues but also turn dissatisfied customers into loyal
n
advocates for the brand?
tio
5. How can Nykaa leverage insights from the current landscape to position itself as the preferred choice
for customers in the years ahead?
lu
So
The Case Solution Starts From page 6
,ANALYSIS
1. What are the key drivers in the beauty and personal care industry in India?
Millennials and Gen Z
Gen Z, a generation that entered the world at the beginning of the digital age, accounts for about a quarter of
the world’s population and about a quarter of India’s total population.1 Most millennials (77 per cent) and Gen
Z (76 per cent of households) use the internet to shop for cosmetics and hygiene products. When it comes to
online purchases, millennials also have the greatest order frequency and annual expenditure rates.2
e
Sustainability and Natural/Organic Ingredients
pl
Concerns regarding the possible adverse consequences of using products that include a lot of chemicals are
m
driving consumers in the direction of natural and organic skin care products. Companies are utilizing plant
extracts and natural oils in order to provide chemical-free options that are appealing to consumers who are
concerned about the environment.3
Sa
Male Grooming Products and Wellness
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There has been a recent uptick in products aimed specifically towards men’s mental and emotional health,
tio
lu
So
The Case Solution Starts From page 6
, EXHIBIT -1: CONSUMER BUYING BEHAVIOUR PROCESS AT NYKAA
• Can be triggered by low product supply
Problem • Desire for an upgrade
Recognition • Marketing incentives
• Targeted ads
• Looking at new product categories
• Personal sources: This includes family, friends, neighbours
• Commercial sources: This includes advertising,
Information Search salespeople, dealers, packaging, display
•
•
e
pl
Evaluations •
m
of
Alternatives
Sa
•
n
Purchase Decision
tio
•
lu
So
Post-Purchase •
Behaviour
The Case Solution Starts From page 6
, EXHIBIT -3: NYKAA SERVICE GAP MODEL DESCRIPTION
Gap (Issues) Description Reasons Service Issue at Strategies to Overcome Gaps
Nykaa
The Knowledge Difference between Insufficient marketing Customers’ opinions Nykaa’s management should do research to better understand client expectations
Gap customer’s expected research of Nykaa's products and analyze customer reviews.
service from Nykaa Inadequate upward and services It should examine complaints.
and management communication suffered when they Nykaa should reduce the levels between the staff members who deal with consumer
perceptions Too many tiers of received damaged contact and management, and improve upward communication.
management or expired goods.
e
The Standard The way that
pl
Gap management
interprets the level
of service that
m
customers want and
how that is
translated to service
procedures and
Sa
service
specifications
n
tio
lu
So
The Case Solution Starts From page 6
CASE STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
Nykaa E-Retail Limited (Nykaa) has come a long way since its founding in 2012 by Falguni Nayar in
Mumbai, India, establishing itself as a prominent participant in the e-commerce and retail industry. Not
only has Nykaa revolutionized the field of online shopping in India for beauty and personal care products,
but it has also played an essential role in the development of an ecosystem within that field. Nykaa has
n
curated an offering of assorted beauty products spanning a variety of categories, including make-up,
skincare, haircare, bath and body, fragrance, grooming equipment, personal care, and health and wellness.
tio
The company offers an enormous selection of over 2,400 legitimate brands. Nykaa has been able to maintain
consistent growth because of its unrelenting concentration on the requirements of its customers and its close
working relationships with other companies. However, feedback and reviews from customers have
lu
indicated a disconnect between client expectations and Nykaa’s performance. An increase in customer
complaints, encompassing technical issues and problems related to customer assistance, exchanges, returns,
So
and refunds—essentially, the entire customer experience—is revealing opportunities for improvement.
Nykaa’s leadership has expressed concern over the increasing number of incidents of consumer
dissatisfaction, an issue that is coming to light amid an increasingly competitive digital landscape.
OBJECTIVES
• Understand the growth drivers in the beauty and personal care industry.
• Understand and apply the customer buying behaviour model from an e-commerce perspective.
• Understand and analyze service quality by applying the gap model of service quality.
• Be able to apply the service recovery paradox.
• Analyze the role of technology in enhancing the customer experience.
The Case Solution Starts From page 6
, e
pl
ASSIGNMENT QUESTIONS
m
1. What are the key drivers in the beauty and personal care industry in India?
Sa
2. How does a customer make a purchase through e-commerce websites/apps?
3. What gaps exist between Nykaa customers’ expectations and their actual experiences while making
purchases online?
4. Considering Nykaa’s recent challenges, how can the company strategically utilize effective service
recovery techniques to not only address these issues but also turn dissatisfied customers into loyal
n
advocates for the brand?
tio
5. How can Nykaa leverage insights from the current landscape to position itself as the preferred choice
for customers in the years ahead?
lu
So
The Case Solution Starts From page 6
,ANALYSIS
1. What are the key drivers in the beauty and personal care industry in India?
Millennials and Gen Z
Gen Z, a generation that entered the world at the beginning of the digital age, accounts for about a quarter of
the world’s population and about a quarter of India’s total population.1 Most millennials (77 per cent) and Gen
Z (76 per cent of households) use the internet to shop for cosmetics and hygiene products. When it comes to
online purchases, millennials also have the greatest order frequency and annual expenditure rates.2
e
Sustainability and Natural/Organic Ingredients
pl
Concerns regarding the possible adverse consequences of using products that include a lot of chemicals are
m
driving consumers in the direction of natural and organic skin care products. Companies are utilizing plant
extracts and natural oils in order to provide chemical-free options that are appealing to consumers who are
concerned about the environment.3
Sa
Male Grooming Products and Wellness
n
There has been a recent uptick in products aimed specifically towards men’s mental and emotional health,
tio
lu
So
The Case Solution Starts From page 6
, EXHIBIT -1: CONSUMER BUYING BEHAVIOUR PROCESS AT NYKAA
• Can be triggered by low product supply
Problem • Desire for an upgrade
Recognition • Marketing incentives
• Targeted ads
• Looking at new product categories
• Personal sources: This includes family, friends, neighbours
• Commercial sources: This includes advertising,
Information Search salespeople, dealers, packaging, display
•
•
e
pl
Evaluations •
m
of
Alternatives
Sa
•
n
Purchase Decision
tio
•
lu
So
Post-Purchase •
Behaviour
The Case Solution Starts From page 6
, EXHIBIT -3: NYKAA SERVICE GAP MODEL DESCRIPTION
Gap (Issues) Description Reasons Service Issue at Strategies to Overcome Gaps
Nykaa
The Knowledge Difference between Insufficient marketing Customers’ opinions Nykaa’s management should do research to better understand client expectations
Gap customer’s expected research of Nykaa's products and analyze customer reviews.
service from Nykaa Inadequate upward and services It should examine complaints.
and management communication suffered when they Nykaa should reduce the levels between the staff members who deal with consumer
perceptions Too many tiers of received damaged contact and management, and improve upward communication.
management or expired goods.
e
The Standard The way that
pl
Gap management
interprets the level
of service that
m
customers want and
how that is
translated to service
procedures and
Sa
service
specifications
n
tio
lu
So
The Case Solution Starts From page 6
