Salon chains feel the heat from home service platforms, dermatology clinics

Now it’s the turn of salon chains across India to be cremated – but this time it’s slow and deliberate.

The rapid rise of technology-enabled at-home beauty services and expert-focused dermatology clinics is steadily taking away a disproportionate share of growth in a market that has been dominated by hair salon chains for years.

On-demand platforms like Urban Company, GetLooks and Yes Madam are leveraging the convenience of home care fueled by the need for instant gratification.

Urban Company has emerged as India’s leader in home beauty. The Indian consumer services sector, which includes salon, beauty and home cleaning offerings, has achieved net transaction value (NTV) so far: ₹762 crore in the second quarter of FY26, expanding at 19% year-on-year. Revenue from this segment increased by 24% ₹262 crore, thanks to strong growth in beauty and grooming. (NTV is the total value of customer orders.)

For perspective, Lakmé Lever Pvt. Ltd., a major chain of beauty and wellness salons in India and a leading consumer products unit of Hindustan Unilever, reported revenue of: ₹366.9 crore for the financial year 2024-25.

Urban Company’s revenue from consumer services ₹262 crore in Q1 262, driven by beauty and grooming. Salon chain Lakmé’s total business for FY25 ₹366.9 crore. The first is 11 years old, the second is 73 years old.

That’s how fast the 11-year-old Urban Company has grown. Lakmé was founded in 1952. Questions sent to Hindustan Unilever for this story remained unanswered.

For Urban Company, the story is just beginning. The overall size of India’s beauty and wellness services market has been estimated, new economics researcher Redseer said in its latest initial public offering (IPO) prospectus. ₹It is projected to grow from ₹56,500 crore to ₹58,500 crore in 2024, with a compound annual growth rate of 9-10% by 2029. This amount was split almost equally between male and female beauty segments, with the former being marginally higher. Hair care dominates women’s beauty services, accounting for approximately 69% of the segment. (Upgraded by Urban Company ₹1,900 crore in its September IPO.)

Despite the size of the market, online penetration remains below 1%, leaving ample room for digital expansion.

Gurugram-based Urban Company offers a wide range of personal services, from women’s skin care and hair care to men’s haircuts and a variety of massages such as ayurvedic and deep tissue massages. To replicate salon-like experiences, it is standardizing services by training professionals, grading them into service level tiers, and sending them to customers’ homes with branded, disposable products from partners like O3+ and Sara, premium professional and skin care brands.

Noida-based Yes Madam also recorded record growth during the festival season from August to October. In October 2025, an 80% year-on-year increase in bookings was reported, closing at 2.45 lakh as against 1.37 lakh in the previous year. With ₹The popular Sokora Korean Glow facial company, which generates revenue of Rs 225 crore and has an EBITDA positive status, crossed 30,000 bookings in a single month, a senior executive said. (EBITDA, short for earnings before interest, taxes, depreciation, and amortization, represents cash profits at a company and is a measure of the efficiency of its business operations.)

“Festivals have become a powerful customer acquisition funnel,” said Mayank Arya, co-founder of Yes Madam. He said many first-time users during the 2024 festival season are re-booking this year. The platform has surpassed four million app downloads, reflecting growing consumer preference for technology-enabled beauty services. (Urban Company has over 10 million downloads.)

Smaller rival GetLooks, founded by Gaurav Maheshwari, experienced similar momentum during this year’s festive season, which runs from Navratri in early August to Diwali in the third week of October. Even between September and October, “there was a growth of 25-30%,” Maheshwari said, adding that although November saw a 10% decline, demand still remained around 70% of the festival peak. December usually brings another rise, especially in the last week.

But managing scale is still a challenge. “This is not a product business…supply is limited and cannot be increased instantly,” Maheshwari explained. GetLooks employs around 500 beauticians in Bengaluru and uses incentives to motivate them during busy periods. “Usually if they’re getting two appointments a day, they’re getting three or four,” he said. “Even at 98-99% capacity, bookings remain high.”

gradual market

Leaders in the salon chain business argue that the rapid growth in home services is only part of the story. Pushkaraj Shenai, former CEO of Lakmé Salons, believes the market has evolved to serve three distinct consumer “need states”: convenience, experience and expertise. “HE [the customer]He’s looking for expertise and he’s looking for convenience,” Shenai said. “For frequent and need-based low-end hygiene type services, convenience is more important; You don’t want to waste time traveling or waiting. For these, optional and in-home services work better.”

O3+, a leading beauty salon brand headquartered in Noida, says the boom in home beauty has not significantly harmed salons. “The in-home service trend has not greatly impacted walk-ins,” the company responded via email. “Customers understand the value of professional salon experiences, hygiene and expert care that cannot always be replicated at home.”

Smaller salon chains also echo this sentiment. Rahul Balachandran, CEO, YLG Salons, said: “No woman wants to get a haircut at home; getting bathed and pampered at the salon is a completely different experience. Salon is ‘me time’ for our customers; it is where they step out of their routine to feel rejuvenated.”

“To achieve turnover ₹700-800 crore, some of these players got burned ₹5,000 crore”, this is not sustainable. — Rahul Balachandran, CEO, YLG Salons

He also questioned the sustainability of the home services model. “To achieve turnover ₹700-800 crore, some of these players got burned ₹The company’s home salon business, YLG Home Services, which has been operating for nearly a decade, is complementary to its mainstay brick-and-mortar business. “Our focus and core business continues to be on physical venues,” Balachandran said.

Meanwhile, demand for highly specialized services is shifting elsewhere: to dermatology clinics. As evidence, Shenai noted that clinics specializing in derma that offer facial and skin treatments have found that “the quality of expertise is significantly higher and the cost is not much different.” [from salons]”

Such high-end services represent only 9% of visitors but contribute almost 30% of revenue. “This is actually the biggest blow for venues,” he said.

Indeed, dermatology and hair clinics are reshaping the world-class beauty landscape. Brands like Kaya Skin Clinic offer clinical-level treatments that go beyond regular facials and hair spas. Kaya operates more than 80 clinics across India and has over 100,000 “Kaya Smiles” members. More than 85% of its business comes from repeat customers, according to the company’s Q1FY26 investor presentation.

About a sixth of the clinic chain’s revenues come from new-age services such as AI-powered anti-aging and body contouring, according to results earlier this financial year. Kaya reported the following in the 1st quarter of Year 26: ₹106.8 crore revenue and ₹5.7 crore in net profit.

Indian aesthetics and dermatology market expected to nearly double ₹30,000-32,000 crore by FY29 ₹It grew to ₹17,000 crore in fiscal 2024 at a compound annual growth rate of 12-14%, Kaya said in its investor presentation.

Everything will come together. The bigger challenge for salons is internal: attracting, training and retaining talented professionals. — Pushkaraj Shenai, former CEO of Lakmé Salons

Investor interest reflects this project growth. In August this year, Surat-based Sakhiya Skin Clinic filed for IPO. ₹61.72 crore, approx. ₹50 million of this will be used to open news clinics. In March 2023, Kedaara Capital acquired a majority stake in Oliva Skin & Hair Clinic in a deal valued at approximately $65 million (approx. ₹530 crore).

Former Lakmé president Shenai outlined her senior perspective as she looks to the future. “I think everything will coexist. It’s like AI (artificial intelligence), it won’t eliminate jobs, but people who use it intelligently will take away opportunities from those who don’t.”

Similarly, salon chains that focus on expertise and talent need not fear anything, he said. The bigger challenge is internal: attracting, training and retaining talented professionals.