Business Model of Mamaearth: Why is it Unique and Successful

Dev Gupta Dev Gupta
Aug 18, 2022 5 min read
Business Model of Mamaearth: Why is it Unique and Successful

Launched in 2016 Mamaearth has made 1.5 million customers in just a few years. It is Asia's first company that has been certified by Made Safe.

It is competing against big companies like Himalaya and Johnson & Johnson. But, how did Mamaearth capture a big share of the market in such a short time? To answer this question we need to understand the business model of Mamaearth.

About Mamaearth
Target Audience of Mamaearth
Business Model of Mamaearth
What is Unique about the Business Model of Mamaearth?
Mamaearth Marketing Strategy
How Does Mamaearth Earn Money?
Mamaearth Competitors
FAQ

About Mamaearth

Mamaearth is an Indian Brand registered under Honasa Consumer Pvt Ltd that aims to provide toxin-free baby care, skincare, and hair care products.

The founders of Mamaearth are Ghazal Alagh and Varun Alagh. The headquarters of Mamaearth is in Gurugram, Haryana. The tagline of the company is Goodness Inside.

Target Audience of Mamaearth

Initially, Mamaearth targeted mothers and their babies by selling baby care, pregnancy care, skin and hair care products. It also sold accessories, toys and apparel.

Then the company started to expand its customer base by targeting the millennial generation by selling more chemical-free skin care products like serums and creams, face wash, lotions and hair oils.

The company also targeted men by offering products like aftershave lotions, and beard and hair oils.

Mamaearth Products
Mamaearth Products

Business Model of Mamaearth

The business model of Mamaearth is straightforward. The company formulate products that are later produced by contract manufacturers under the permit of the Mamaearth brand.

Mamaearth mainly sell online through D2C Channels like Amazon, Flipkart, etc., and other offline stores. They have an omnichannel presence.


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What is Unique about the Business Model of Mamaearth?

1) Connecting with their Target Audience:

The most important thing for any brand is to connect with its target audience and gain their trust. This is what Mamaearth did brilliantly. From the start itself, they targeted mothers and made advertisements that resonated with them.

As the founders themselves got the idea of Mamaearth when they were looking for toxin-free and natural baby products online, they knew what parents wanted for their babies.

We are a 'mum-powered' company and work with a large number of mothers who are involved in the process, right from ideation, conceptualization to the actual product launch. We believe this connection with mothers will continue to be the biggest driver of success. We have more than 200 young moms on board who help us in conceptualizing and formulating the products. The moms then test these products, and only those with great feedback are approved for mass production,” says Ghazal Alagh.

2) Superior Quality Product:

The founders of Mamaearth believe in providing quality products to their customers.

As they have a superior quality product, people themselves recommend their products to other people. Word of mouth marketing has done miracles for their brand.

In 2019 Mamaearth got the β€œOne of the Best Brands” in India Award at the 2nd edition of the ET Brand Festival.

The company has come up with unique products that have attracted a lot of people.

Some of their unique products include India’s first bamboo-based baby wipes, 100% natural plant-based toothpaste for children, skin and hair care products with natural ingredients like onion, CoCo, charcoal, and ubtan.

3) Lean Innovation Cycle:

Lean innovation follows a principle where you focus on increasing efficiency by continuously listening to your customer’s feedback. Your main priority is experimentation and continuously improving your product quality.

Lean innovation helped Mamaearth to understand its customer needs and fulfill those needs immediately.

Experimentation helped them to increase the quality of their products and also to generate new product ideas. In a very short time, they satisfied their customers using this method.

Mamaearth Marketing Strategy

1) Influencer Marketing:

Mamaearth has worked with a lot of Influencers on the internet. Influencers have helped the company to reach a wider audience.

Influencers tell the benefits of these products on various social media platforms. Mamaearth also works with five hundred mother bloggers to spread awareness about the brand.

2) Brand Endorsement:

Collaborating with Bollywood Actress Shilpa Shetty Kundra as a brand ambassador has to be their best marketing strategy.

Shilpa Shetty has a lot of popularity, so her becoming a brand ambassador and also an investor hugely benefited Mamaearth.

Mamaearth Founders with Shilpa Shetty
Mamaearth Founders with Shilpa Shetty

3) Digital Ads:

Mamaearth majorly promotes itself through digital ads. They have smartly utilized digital ads and increased their customer base. Their ads are very catchy and symbolize their brands in an effective manner.


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How Does Mamaearth Earn Money?

The customer acquisition strategy of Mamaearth is completely focused on digital content.

Almost 90% of the sale of Mamaearth products comes from online platforms.

Their main aim is to sell as many products as possible online. They earn money by selling products on Flipkart, Amazon, and other similar E-commerce websites.

Revenue of Mamaearth
Revenue of Mamaearth

Interestingly, only 20% of the brand revenue comes from baby products.

On the other hand, 80% of the revenue comes from skincare and haircare products.

As Mamaearth comes in the personal care category they enjoy a healthy gross margin profile of about 65%. So, they can invest 40-50% of revenue in marketing.

Mamaearth Competitors

The competitors of Mamaearth are as follows: The Moms Co, Lotus Herbals, Johnson & Johnson, Marico, Emami Limited, and Bey Bee.

Conclusion

At its core, Mamaearth’s amazing products helped them to reach great heights. They have understood their customer's needs properly and served those needs in an excellent way. Mamaearth is an inspiration for many startups. Their business and revenue model are simple yet effective.

FAQ

What are Mamaearth products?

Mamaearth mainly deals with baby-care products including accessories, toys, apparel, pregnancy care products, skin and hair care products.

Is Mamaearth an Indian company?

Yes, Mamaearth is an Indian Company founded by Ghazal Alagh and Varun Alagh. It was launched in 2006 and the headquarters is in Gurugram, Haryana.

How are Mamaearth products sold in the market?

Mamaearth products are sold through E-commerce websites like Flipkart, Amazon, and also via offline stores.

Who is the Target Audience of Mamaearth?

The target audience of Mamaearth is mainly mothers and their lovely babies.

What is the Market Value of Mamaearth?

In January 2022, Mamaearth was valued at $1.2 billion when it raised Β fresh funds from investors including Sequoia and Belgium's Sofina.

Are Mamaearth Products Safe?

Mamaearth is the only company in India that is 'Made Safe' certified. Mamaearth products are free from all the toxins that are banned in most countries.

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