Mumbai: Established beauty product makers such as Forest Essentials, Colorbar, Kama Ayurveda, Body Shop, VLCC Personal Care and Lotus Herbals saw a slowdown in sales growth in FY24, according to the latest Registrar of Companies filings. Consumers favoured new-age rivals such as Minimalist and Pilgrim, specialised derma brands, as well as global labels Shiseido, Innisfree and Eucerin.Sales growth of established brands, mostly in the natural skincare segment, more than halved to single digits during the previous financial year amid a broader economic slump. In contrast, companies such as L'Oreal, Nykaa and Sephora continued to grow at 12-34% on a significantly bigger base, even as they lost pace.Direct-to-consumer brand Pilgrim more than doubled its sales, Minimalist's revenue increased 80% and Foxtale's sales surged 500% on a lower base."With most consumers tightening their budget on discretionary spends in FY24, they seem to have opted for brands that give instant benefits compared to natural products, which take time to be effective," said Devangshu Dutta, founder of retail consulting firm Third Eyesight. Over the past few years, there has been a flurry of beauty product launches, which have depended on platforms such as Nykaa and Tira for sales.In the past two years, Nykaa has launched more than 350 brands, or nearly one new label every alternate day on average. This includes international brands such as CeraVe, Uriage and Versed, as well as home-grown brands such as Foxtale and Hyphen. Reliance Retail, which entered beauty retailing with Tira two years ago, now sells nearly 1,000 brands, including exclusive labels such as Akind, Augustinus Bader, Allies of Skin, Kundal and Patchology."Ten years ago, we were only competing against the big guys," Vincent Warnery, global chief executive of Beiersdorf, maker of Eucerin, Nivea and La Prairie, told ET last month. "Now we have those local brands, and we have to be a bit more agile."119225943 On Nykaa, Fenty Beauty by Rihanna is the highest-selling brand in lipcare while Eucerin has become its biggest premium dermo-cosmetic serum. South Korean beauty brands Axis-Y, Tirtir and Numbuzin grew over 60% in 2024, with sales of toners increasing 104%, serums 45%, moisturisers 52% and sunscreens 154% on the platform.VLCC, Kama and Colorbar did not respond to ET's queries, while Forest Essentials was not reachable.In January, Mike Jatania, cofounder and executive chairman of The Body Shop and Aurea Group, told ET, "There would be continuation of new entrants. Inflation is still a global issue and we will see the pressure. Competitive environment will be a challenge... 70% of out-stores are showing decent growth. We have closed some stores and opened a few also, that's the nature of the business."Ingredients MatterWarnery of Beiersdorf emphasised the need to stay focused on "big innovation, by being able to talk to GenZ, (a position) which might be filled in by those local brands coming with basic ingredients." The likes of Minimalist, Ordinary and Pilgrim disclose active ingredients at a granular level, specifying the exact percentage of acid used in the product to appeal to GenZ users (those born between 1997 and early 2010s), who are said to be far more conscious of what they use on their skin compared to millennials (those born during 1980s to mid-1990s) and Gen X (those born from about 1965 to 1980).Shoppers Stop, which manages brands such as Estee Lauder, Shiseido, Bobbi Brown, Mac and Clinique in India, sees the overall beauty market driven by companies focusing on consumers across age groups, and not just younger ones. Both natural and dermatological products are expected to find takers."While most new-age brands tap younger cohorts, their pocket size allows them to mostly buy affordable products and the more affluent consumers opt for established global brands that have proven themselves since decades," said Biju Kassim, chief executive, beauty, at Shoppers Stop. "Beauty is still not a habit in India and with hundreds of brands being launched, the focus is to grow penetration. There is also a shift from care to cure, driven by derma-recommended products and brands disclosing active ingredients, but it is still a niche sub-segment."Dutta of Third Eyesight sees the current trend as temporary. "We expect growth of (established) companies to bounce back in the current fiscal, driven by a strong demand for beauty," he said, pointing especially to online platforms. India's beauty and personal care market is expected to reach $34 billion by 2028, up from $21 billion now, driven by an online surge and a growing preference for high-quality, premium beauty products, according to a report by Nykaa and consulting firm Redseer.Nicolas Hieronimus, chief executive of cosmetics giant L'Oreal, last year said consumers in India are more demanding and are not just settling for very basic things like putting an ingredient in a product such as salicylic acid or collagen. "That's where L'Oreal has the best cards to play, and that's where we really thrive," he had told ET.Beiersdorf, Unilever, L'Oreal and Shiseido, among the world's largest cosmetics companies, have all identified India as a key growth driver, citing the burgeoning population and growing affinity for beauty products.