Nykaa owner’s Q4 profit up nearly 50 percent

Nykaa owner’s Q4 profit up nearly 50 percent

THE WHAT? FSN E-Commerce Ventures has reported a 50 percent increase in profit for the fourth quarter, according to a report published by Reuters, thanks to a clever marketing campaign that convinced consumers to splash out on little luxuries.

THE DETAILS The Nykaa owner’s EBITDA margin rose to 5.4 percent, versus 4 percent in the prior year period and Nykaa reported consolidated profit before tax of ₹86.25 million and beauty and personal care orders were up 22 percent with the average order value growing 5 percent yoy to ₹1,803.

THE WHY? Reuters attributes FSN’s success to the lipstick effect whereby shoppers splash out on small mood-boosters, despite being cash-strapped, while scaling back large purchases. Nykaa’s Pink Love campaign as a particularly successful bid to persuade consumers to part with their cash.