How I Started A $100K/Month Ayurveda Beauty And Wellness Beverage
Hello! Who are you and what business did you start?
A chemical engineer by education who decided to make food without chemicals! Almost a decade at Unilever helped me discover my love for consumers and brands. But the pivotal moment was when I became a wellness enthusiast. This was after a backbone fracture in a soccer match that made me join Yoga. Since then, I have been passionate about marrying the logic of the west with the wisdom of the east.
Auric is a beauty & wellness brand based on Ayurveda (ancient wisdom from India). It brings together botanicals from Ayurveda in Coconut Water to make 100% Natural & Low-Calorie beverages. Pre-COVID, Skin Radiance which promises healthy glowing skin was our best seller. Post-COVID, Body Defence which promises immunity is our best-seller
We are already selling 150k bottles of Auric every month. The best thing is that customers have seen visible benefits of Auric and hence, have come back to become loyal customers.
What's your backstory and how did you come up with the idea?
The inflection point for me had its origins in both professional and personal life.
Most of my time at Unilever was spent with categories such as Haircare and Skincare. Customers buy brands in these categories for benefits like anti-dandruff. Surprisingly, the same customer ends up making purchases in foods due to taste & refreshment alone. Shouldn’t we be carrying more about the benefits of products that go in our bodies as compared to what goes over our bodies?
The second insight came from my personal life. A backbone fracture led me to three years of Physiotherapy which did not help. I turned towards Yoga and five years later, I came out not only a fitter person but also a changed being. That’s when I started learning and practicing Ayurveda.
I would try to convince my friends to adopt Ayurveda but I would always receive excuses like Ayurveda is difficult to understand. The best of all excuses was that people felt they needed to follow a sage to be able to adopt Ayurveda. That’s when the second insight came along - Make Ayurveda convenient and aspirational.
I have been a professional sportsperson for a greater part of my formative years. Nutrition & Fitness is something close to my heart. Yoga & Ayurveda had brought about the insane curiosity on ancient heritage, going back to roots and wellness for the millennial lifestyle. I knew this is what I love and this is what I would want to do. Hence, left Unilever to start Auric. After having done well at Unilever for over 8 years, it was a difficult decision but every minute since then has been worthwhile.
The background at Unilever helped in shaping the thinking from products to brands. Unilever is a school in many ways and that education helped me to move through Team-Product-Brand in the first 9 months.
Take us through the process of designing, prototyping, and manufacturing your first product.
The first biggest clarity for me after talking to customers was that Ayurveda is a reason to believe in the benefits of a product but it was not the reason to buy the product. There is a thin line between the two but a very important one. People in the end want to look good and feel good. Ayurveda is the process to make people reach that destination but it is not the destination itself. Hence, Auric became a Beauty & Wellness brand based on Ayurveda.
Being an entrepreneur means being a learner. I have not come across a single entrepreneur who did not commit mistakes or does not regret an action done in the past. However, every single entrepreneur I have met acknowledges the mistake and learns from the same.
Once I was clear about the value we will offer to consumers then the next obvious step was to put down the form factor. While our broad product definition was to give benefits of supplements in grocery convenience, choosing format in grocery is going to be the first question.
Beverage came out to be a category with high trials and natural lifestyle choices as well as one of the categories where innovations haven’t contributed to the growth of the overall category. At this step is when I started researching formulation. Ayurveda being an ancient science has a lot of age-old literature available as references along with doctors and experts in the field.
The prototype was ready in February 2018, which was taken for consumer testing at a farmer’s market, co-working space, residential complex, and exit gate of hypermarkets. This is where a treasure trove of information was discovered.
I learned a lot during these day-long sessions. The consumer immersions helped me learn everything from taste to packaging to pricing to selling propositions. These lessons helped me come back to the drawing board and make crucial decisions on taste specifically. “People think their needs, wants & desires are healthy but in the end they are humans! Taste compromise is not in their dictionary.”
I was all set to launch our beverages in May 2018. Hence, I hired the first person who became our head of operations. Soon after, the manufacturing partner suffered huge losses in his business. Hence, he decided to come out of manufacturing Auric. The next week was spent on the road to meet new manufacturing owners and the next 3 months were spent re-establishing a baseline on manufacturing and quality. Finally, the product was launched at end of September 2018.
Describe the process of launching the business.
Auric is changing the conversation in the beverage industry from an impulse-driven purchase driver to thought-through conscious consumption. This also means that the Go-To-Market strategy should also move from offline to online. That is the reason Auric planned to reach its target market via social media and D2C strategy. D2C allows us to understand our end consumer, their motivations, and reasons for liking us & not liking us. It just allows us to reach product-market fit better and stronger
Auric started as a bootstrapped venture. Even after almost 3 years later, Auric is still 95% bootstrapped. The biggest lesson has been that startups tend to overestimate speed to reach scale and underestimate the premium a good brand can earn.
The constant conversation with consumers helped us understand things we may have assumed right or wrong.
Since launch, what has worked to attract and retain customers?
The first trial happens due to content, community, and creatives. Trying out different things and understanding the reasons for success/failure helps you to enter into a flywheel soon. The repeat happens due to experience, packaging, and product. For us, proposition and product benefits were strong drivers for success which led to an increase in trials.
Social Media advertising is dependent a lot on creative fatigue and therefore, trying things weekly gave us maximum traffic & sales. Even after 2 years, Facebook and Instagram are central to our brand and advertising.
Youtube influencer endorsement is an under-appreciated marketing channel but it is a long term gratification distribution. For a functional product like ours, fictional content does not work. Auric works with influencers who are experts in the fitness, wellness, or beauty industry whose audience is highly engaging. Example of an influencer collaborating with Auric here
80% of our social media spend goes towards bringing traffic to the Auric website. That is part of the strategy to know our end customer. Amazon for example offers great scalability when you know what is the right thing to do. There is no question about not being present on Amazon because, in steady-state, consumers are not going to buy ten brands from ten different websites. Auric was lucky to be part of the Amazon launchpad giving us access to a dedicated account manager to help us learn at an accelerated pace.
How are you doing today and what does the future look like?
We have become unit operation positive which essentially means that we can recover all variable costs i.e. product, logistics, and advertising from Auric revenue. This in my opinion is the single biggest metric to judge product-market fit along with retention rates.
We started with high gross margins but free delivery of liquids (beverages are bulky) was a difficult cost driver. Improving efficiency, Better Negotiation helped us move better. Secondly, Return on Advertising Spends is essentially AOV to the CAC ratio. A lot of people focus on CAC alone but we tend to miss the value left on the table by focusing on AOV increase. This can come by showing value propositions to consumers. Today, 80% of our sales are on our website and 15% on Amazon.
The future is towards penetrating to more consumers in India, the US, and the UK on one hand while increasing the share of wallet of existing consumers with new products.
Through starting the business, have you learned anything particularly helpful or advantageous?
Being an entrepreneur means being a learner. I have not come across a single entrepreneur who did not commit mistakes or does not regret an action done in the past. However, every single entrepreneur I have met acknowledges the mistake and learns from the same.
Starting with cofounder(s) help to achieve more at lesser overheads. “Achieve more” is driven by passion resulting in quality and quantity. Secondly, fundraising is a full-time job. Easiest to do before the product is in the market. Once a product is launched, it is difficult to take the mind off operations needed to reach the product-market fit.
Lastly, always keep unit profitability in mind. It pushes you in the right direction.
The proposition and price worked in favor of Auric. The constant conversation with consumers helped us understand things we may have assumed right or wrong. For example, we believed Auric will target 18yo to 35yo top 6 cities. But we found ourselves to be relevant to 18yo to 35yo in the top 50 cities.
Auric is at the cusp of beauty, wellness, grocery, and supplements. COVID has further helped with tailwinds.
What platform/tools do you use for your business?
Google Analytics, Microsoft Excel, Whatsapp, and Facebook Analytics. We started on Wix platform so we did not have access to the ecosystem of Shopify. But we have transitioned to Shopify only this month.
What have been the most influential books, podcasts, or other resources?
- Smart Startup Strategy in healthy food and beverage by New Nutrition Business
- D2C CBinsights
- Bevnet
- Frederic Fernandez Linkedin posts
Advice for other entrepreneurs who want to get started or are just starting?
Do something that will motivate you through the darkest of days you may not have experienced but only imagined. Secondly, talk to as many people as possible to hear their point of view and then do what you believe in with full conviction
Are you looking to hire for certain positions right now?
Not in particular as of now. But positions keep coming up. Do connect with me on LinkedIn.
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
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