WOW ruled naturals. Why is it struggling in today’s beauty game?

An early mover in the chemical-free skincare segment, WOW continued to rely on a few hero ingredients (onion, apple cider vinegar, aloe) long after markets were saturated with nearly identical products. “Our distinctiveness has disappeared,” founder Manish Chowdhary told Mint. “Everyone was doing some version of the same thing.”

Buoyed by initial success, the digital-first company embarked on costly offline expansion even as the beauty market made a decisive shift to clinical, active ingredient products containing high concentrations of active ingredients targeted at specific skin problems.

“Our formulations were developed five years ago. Today they are obsolete,” said Chowdhary as he attempted a comeback by innovating formulations, adding active ingredients, launching new categories and without abandoning natural ones. “Natural products became a commodity. Everyone was selling onion shampoo, our differentiation decreased.”

sharp reset

Over the past three years, India’s beauty and personal care market has experienced one of the sharpest resets since the natural products boom. According to BDO India’s 2024 industry report, categories based on clinical efficacy are now among the fastest growing, expanding at 14-15% annually, far outpacing mass natural categories.

Premium segments dominated by Masstige and science-backed formulations, a blend of mass and prestige that stands for affordable luxury, are predicted to grow at a compound annual growth rate (CAGR) of 11-13% by 2027, while mass naturals are predicted to lag behind at 6-9%.

Actives-first brands such as Minimalist, Fixderma and Pilgrim are seeing 50-70% growth, underlining a determined consumer shift towards problem-solving skin care.

WOW’s struggles have been exacerbated by its poorly planned expansion into general trade (GT) – neighborhood retail stores – in 2021-23. Like many digital-first brands, WOW underestimated the challenge of offline distribution. He expanded credit, recruited heavily, and assumed that online popularity would automatically translate into heavy store traffic.

“We went ahead of our time,” Chowdhary said. “GT customers are not online customers. We extended too much credit, grew too fast, and didn’t plan secondary sales well.”

Meanwhile, consumer literacy about active ingredients (percentages, molecule names, derm claims) has skyrocketed. WOW’s formulations, which have remained unchanged for years, no longer meet the expectations of an increasingly informed customer. “The technology and formulations we used before are obsolete today,” he said.

Where WOW struggled to get ahead, some of its counterparts readjusted more quickly.

Plum, one of India’s oldest clean beauty brands, has transitioned from storytelling where naturalness is at the forefront, to a clear delivery of problem solutions based on meaningful activities. Founder Shankar Prasad said change is not about following trends but meeting evolving expectations.

“People are still looking for active ingredients, but they’re no longer after individual ingredients. They want solutions,” he said. “These solutions can come from active ingredients, natural sources or hybrids such as exosomes. What matters is results and safety.”

Plum regularly updates formulations, verifies claims, and focuses on texture innovation (gel creams, gels, multi-step routines) by speaking the beauty language that today’s consumers understand.

Juicy Chemistry doubles down on organic, high-impact skin care with solid scientific backing. Founder Pritesh Asher has long warned against blind overuse of acids; This message resonates now as more consumers deal with barrier damage.

“People exfoliate every day, even two or three times a day,” he said. “Many now have irritated, inflamed skin, so the natural segment is increasing again.”

By focusing on both laboratory testing (in-vitro) and real-world testing (in-vivo), traceability and biotechnology-focused formulation, the brand achieves one of the highest repeat rates in the industry at 55% monthly. Its discipline in SKU strategy—reducing confusion and offering concern-specific kits—has maintained its loyalty in a crowded market.

Even category leaders are turning to actives.

Mamaearth’s parent company, Honasa, focuses on science-led beauty, according to the report ₹Revenue during July-September was ₹538 crore, up 22% from the previous year. Earnings before interest, taxes, depreciation and amortization (EBITDA) ₹48 crore, gross margin is over 70%. The fastest growing engines are brands that prioritize actives: The Derma Co, Aqualogica and Dr Sheth’s. Only Derma Co has reached ₹It has clocked an annual recurring revenue (ARR) of ₹750 crore and recently became India’s No. 1 sunscreen brand.

Honasa’s new bets and acquisitions, including the investment in prestigious active ingredient brand Lumineve and dermatologist-led Fang Oral, show a clear strategic shift: The company is placing its biggest contributions not on natural ones, but on effectiveness-focused, clinical positioning.

This widening gap between asset-intensive growth and natural-intensive stagnation sets the context and imperative for the reinvention of WOW.

The naturals category itself is also evolving. Shubham Virmani, co-founder of Esskay Beauty, said the first naturals failed primarily because the actives lacked stability and potency. “Consumers tried natural products with no results and turned to acids,” he said.

But technology is changing this. “With nano-encapsulation and better extraction, natural formulas can now deliver visible results,” added Virmani. “If it’s natural and produces results, it’s a win-win.”

He also noted widespread greenwashing as a cause of the earlier decline of native creatures. “Every brand suddenly became ‘natural’. People tried it, but when they didn’t get results, they went back to chemicals.”

Today, natural products are paired with clinically validated active ingredients and sensory enhancements (scents, textures, rituals). Esskay is also gaining traction in neurocosmetics, which combine effectiveness with stress-relieving experiences, and vegan beauty, which now accounts for 20% of the Indian cosmetics market, making the country the third largest consumer of vegan cosmetics in the world.

Vegan beauty refers to personal care products that do not contain animal ingredients.

Financials underscore these different strategic choices. WOW Skin Science’s revenue increased ₹6.5 crore (FY20) ₹343.9 crore (FY22), but has since declined ₹246.8 crore (FY24), with losses ₹130 crore. Despite raising $98 million (including a $48 million Series C led by GIC in 2022), the company has struggled for profitability as its inherently weighted portfolio became obsolete and its GT gamble turned out wrong.

Plum, which adapts early to active change, ₹91.8 crore revenue in FY21 ₹418.6 crore in FY25, became profitable ₹Earnings of ₹ 24.7 crore were made in the last financial year. Juicy Chemistry, although smaller, generates revenue from ₹19–25 crore while narrowing losses ₹32.5 crore in FY22 ₹5.6 crore in FY25, driven by disciplined SKU rationalization and high repeat users.

Last year, WOW embarked on an internal overhaul of formulations, packaging, claims and channels under what it calls “WOW 2.0.” The new model blends naturals with actives, indicated by “activity labels” on the packaging. Early launches pair glycolic acid with apple cider vinegar, peptides with coconut milk, and niacinamide with rice water.

“We stay in the centre,” Chowdhary said. “We’re not abandoning natural features, but customers now want performance, not just story.”

The company is slowing GT expansion, tightening credit discipline and reducing market discounts. WOW is also investing in category-building plays: a pre-shampoo scalp line, advanced moisturizing lines, and a near-hygiene launch that’s still under wraps for 2025.

It will take time to rebuild credibility. “Trust erodes quickly,” Chowdhary said. Repeat rates have increased for refreshed products, but WOW still lags behind priority brands active in metros, the leading segment of the category.