India's leading online beauty retailer, Nykaa, is piloting a new loyalty initiative called Glam Pass, aiming to fortify its market position and encourage repeat purchases from its customers. This strategic move comes at a time when the battle for India's beauty shoppers is intensifying, with rivals ranging from e-commerce giants to quick-commerce startups.
What is Nykaa's Glam Pass?
According to sources familiar with the development, Glam Pass is a brand-linked loyalty feature that rewards shoppers for repeated purchases on specific cosmetic and skincare brands available on the Nykaa platform. The program is currently focused on labels like NYX Professional Makeup, Minimalist, and Nykaa Cosmetics.
The pass, priced starting from ₹39, provides members with a 10% discount, capped at ₹300, on their first three purchases. The membership is valid for a period of three months. Unlike platform-wide programs such as Amazon Prime, Glam Pass is designed to be brand-specific, offering targeted benefits for labels that a shopper already prefers rather than generic perks across the entire marketplace.
The feature is currently live for a select group of users in Mumbai and is expected to be rolled out to other major cities, including the National Capital Region and Bengaluru, in the coming weeks.
A Strategic Defense in a Crowded Market
Glam Pass represents Nykaa's proactive bid to defend its market share and boost customer retention. The company leads the online beauty retail segment with a nearly 20% market share, as per data from Datum Intelligence. However, it faces stiff competition from Amazon India (close to 15% share) and Flipkart (nearly 10% share).
The competitive pressure is mounting from multiple fronts. Quick-commerce platforms like Blinkit, Swiggy Instamart, and Zepto are rapidly expanding their beauty product assortments and leveraging faster delivery as a key selling point. Horizontal fashion marketplaces like Myntra continue to invest heavily in beauty as a core growth category.
Furthermore, Reliance Retail's Tira has emerged as a significant contender in the beauty space over the last three years. Simultaneously, brand-owned websites are increasingly focused on building direct relationships with consumers, bypassing marketplaces.
The Rising Importance of Loyalty Programs
Loyalty programs have become a critical retention tool in India's fiercely competitive retail landscape, applicable to both online and offline players. The Indian loyalty program market is projected to see explosive growth, with its valuation expected to surge from about $4.3 billion in 2025 to nearly $17.1 billion by 2035, according to Future Market Insights.
This growth is fueled by rising consumer demand for personalized engagement and the adoption of sophisticated, data-driven reward systems. Platforms like Amazon (Prime), Flipkart (Black and VIP), and Myntra (Insider) have popularized broad-based models bundling benefits like faster delivery and exclusive deals.
Offline retailers have also embraced this trend, with chains such as Shoppers Stop, Trent's Westside, and Lifestyle using tiered membership programs to incentivize higher spending. As customer acquisition costs rise, these programs are increasingly viewed not just as discount vehicles but as essential tools to drive purchase frequency, collect valuable shopper data, and deepen brand engagement.
Analyst Satish Meena of Datum Intelligence notes that Nykaa's brand-specific approach with Glam Pass could allow it greater flexibility over margins and promotions. It enables individual brands to co-fund rewards and directly influence repeat purchasing behavior, rather than the company committing to uniform benefits across its vast marketplace.
Meena emphasizes that the success of such programs hinges on more than just discounts. "Discounts alone do not guarantee repeat purchases. Additional benefits like free deliveries without minimum purchase value, early access to sales and offline events, as well as personalised rewards and recognition play a bigger role in building long-term customer loyalty," he added.
Nykaa's beauty retail business, its largest by revenue, reported a 28% year-on-year growth in Gross Merchandise Value (GMV) to ₹3,551 crore in the September quarter. This performance pushed the company's overall operational revenue to ₹2,345 crore. The firm's net profit also witnessed a substantial surge of 243% to ₹34 crore during the same period. On Tuesday, Nykaa's shares opened 0.15% lower at ₹269.15 apiece.
