Driven by increased consumer spending power and rising consciousness about personal appearance and wellness, the beauty and personal care market is booming big in Indonesia.
Recent research shows that revenues in the sector reached US$7.5 billion in 2021, and are projected to grow at a 6.5% CAGR through 2025. Personal care is the largest segment, followed by skincare, cosmetics, and fragrances.
An innovative Indonesian startup named RAENA is tapping into high growth in both the beauty and social commerce markets to build out a platform that’s already providing some 40,000 influencers with discounts, training, dropshipping distribution, and other resources for selling beauty products online.
In a recent podcast, Sreejita Deb, RAENA’s co-founder and CEO, sat down with Helen Wong, Managing Partner of AC Ventures, to share information about the origin and current activities of the beauty startup.
“Essentially, in the first version of RAENA, we were partnering with large influencers and building brands for them. Then, organically, we noticed that the sales of these brands we created with these influencers were actually being driven by the smaller sellers that were using platforms like Shopee and Instagram, and in certain cases, they were selling offline,” she explained.
“When I double-checked into that opportunity and spoke to some of these sellers, I realized that they’re very powerful when it comes to acquiring and retaining customers and figuring out the pulse of the customer. But where they’re very underserved is that they need a full-stack solution. Our platform gives them access to a wide catalog of brands and a logistics network that they can plug and play into. So this was the opportunity.”
RAENA’s key tailwind
From Sreejita’s perspective, RAENA is partnering rather than competing with brands. “When you’re a brand, your core DNA is coming up with great merchandise and figuring out ways to market this merchandise and drive awareness. You are also plugging into multiple distribution channels,” she said.
“If you are a platform, though, your strength is diversity, having a vast depth and breadth of catalog. We are not competing with brands. In fact, we work with over 250 beauty brands, and I see us as a partner to them. One of the things that have been a tailwind for our business is the rise of new Indonesian beauty brands which are doing a great job at coming up with merchandise.”
For a social commerce platform like RAENA, the big challenge lies in acquiring scale, said to the entrepreneur. She asked, “How do I find scalable ways to acquire sellers and how do I empower these sellers to grow their businesses?”
“In parallel, I need to make sure that I have a wide variety of supplies for them so that as their business grows and their customers ask them for more products. They are going to be coming to me for multiple needs.”
Relative to other social commerce platforms in Indonesia, RAENA holds the largest catalog of beauty products. Still, Sreejita maintains that there’s room for more than one beauty product distribution platform in the archipelago, pointing to examples such as Sephora and Ulta in the US.
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