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

It’s now the turn of salon chains in India to get singed — except that this time around it is slow and deliberate.

The rapid rise of tech-enabled home beauty services and expert-driven dermatology clinics is steadily taking away a disproportionate share of growth in a market that’s been dominated by salon chains for years.

On-demand platforms such as Urban Company, GetLooks, and Yes Madam are capitalising on the convenience of home-based grooming stoked by the need for instant gratification.

Urban Company has emerged as a leader in India’s at-home beauty space. Its India consumer services vertical, which includes salon, beauty, and home cleaning offerings, clocked a net transaction value (NTV) of ₹762 crore in Q2 FY26, expanding at a 19% clip year-on-year. Revenue from this segment rose 24% to ₹262 crore, driven by strong growth in beauty and grooming. (NTV is the total value of customer orders.)

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

That’s how fast growth has been for 11-year-old Urban Company. Lakmé was founded in 1952. Queries sent to Hindustan Unilever for this story went unanswered.

For Urban Company, the story is only beginning. In its recent initial public offering (IPO) prospectus, new economy researcher Redseer noted that the overall size of India’s beauty and wellness services market is estimated to be ₹56,500 crore to 58,500 crore in 2024, with a 9-10% compound annual growth rate projected through 2029. The amount was more or less equally split between female and male beauty segments, with the former marginally higher. Haircare dominates female beauty services, comprising nearly 69% of the segment. (Urban Company raised ₹1,900 crore in the September IPO.)

Despite the market’s size, online penetration remains below 1% leaving ample headroom for digital expansion.

Among personal services, Gurugram-based Urban Company has a range: from women’s skincare and hair grooming to men’s haircuts and massages like ayurvedic and deep tissue ones. To replicate salon-like experiences, it standardises services by training professionals, grading them in service-level tiers, and sending them to customer homes with branded, single-use products from partners like O3+ and Sara, which are premium professional and skincare brands.

Noida-based Yes Madam also saw record growth during the festive season spanning August to October. In October 2025, it reported an 80% year-on-year jump in bookings, closing at 2.45 lakh versus 1.37 lakh the previous year. With ₹225 crore in revenue and an Ebitda-positive status, its popular Sokora Korean Glow Facial crossed 30,000 bookings in a single month, a top executive said. (Ebitda, short for earnings before interest, tax, depreciation, and amortisation, represents cash profits at a company and is a measure of the efficiency of its business operations.)

“Festivals have become a strong customer acquisition funnel," said Mayank Arya, Yes Madam’s co-founder. Many first-time users from the festival season of 2024 have rebooked this year, he said. The platform has crossed four million app downloads, reflecting rising consumer preference for tech-enabled beauty services. (The number of downloads for Urban Company is more than 10 million.)

Smaller rival GetLooks, founded by Gaurav Maheshwari, experienced similar momentum in the festival season running from Navratri, which was in early August this year, through Diwali, which was in the third week of October. Even between September and October, “there was a 25-30% growth," said Maheshwari, adding that though November saw a 10% dip, demand still remains around 70% of the festive peak. December typically brings another surge, especially in the final week.

Managing scale, however, remains a challenge. “It’s not a product business… supply is limited and can’t be boosted instantly," Maheshwari explained. GetLooks employs around 500 beauticians in Bengaluru and uses incentives to motivate them during peak periods. “If they usually take two appointments a day, the push is for three or four," he said. “Even at 98-99% capacity, the bookings stay high."

Tiered market

Leaders from the salon chain business argue that the rapid rise of home services is only one part of the story. Pushkaraj Shenai, former CEO of Lakmé Salons, believes the market is evolving to serve three distinct consumer “need states": convenience, experience, and expertise. “She [the customer]’s seeking expertise and she’s seeking convenience," Shenai said. “Convenience is more important for low-end hygiene-type services that are frequent and need-based — you don’t want to waste time travelling or waiting. For these, on-demand and at-home services work better."

Leading salon brand O3+, headquartered in Noida, says the boom in home beauty hasn’t significantly dented its walk-ins. “The trend of at-home services hasn’t majorly affected walk-ins," the company responded to on email. “Customers understand the value of professional salon experiences, hygiene, and expert care that can’t always be replicated at home."

Smaller salon chains echo this sentiment. Rahul Balachandran, CEO of YLG Salons, said, “No woman would want to do a haircut at home — washing and pampering in a salon is a completely different experience. The salon is ‘me time’ for our customers; it’s where they step out of their routine to feel rejuvenated."

Further, he questioned the sustainability of the home services model. “To reach a turnover of ₹700-800 crore, some of these players have burned over ₹5,000 crore", which is not sustainable, he said. YLG Home Services, the company’s home salon vertical that has been in business for nearly a decade, is complementary to its mainstay brick-and-mortar salon business. “Our focus and core business remain in physical salons," Balachandran said.

Meanwhile, the demand for services with a high degree of expertise is shifting elsewhere: to dermatology clinics. As evidence, Shenai pointed to derma-specialised clinics offering facial and skin treatments sprouting up “where the quality of expertise is dramatically higher and the cost isn’t that different [from salons]."

Such high-end services represent only 9% of footfalls but contribute nearly 30% of revenue. “That’s actually the bigger hit for salons," he said.

Indeed, dermatology and hair clinics are reshaping the premium beauty landscape. Brands such as Kaya Skin Clinic offering clinical-grade treatments that go beyond regular facials and hair spas. Kaya operates over 80 clinics across India and has more than 100,000 “Kaya Smiles" members. Over 85% of its business coming from repeat customers, according to the company’s Q1FY26 investor presentation.

About one-sixth of the clinic chain’s revenues comes from new-age services like AI-powered anti-ageing and body contouring, its results from earlier this financial year show. In Q1 FY26, Kaya reported ₹106.8 crore in revenue and ₹5.7 crore in net profit.

The Indian aesthetics and dermatology market is projected to nearly double to ₹30,000-32,000 crore by FY29 from ₹17,000 crore in fiscal 2024 growing at a 12-14% compound annual growth rate, the Kaya investor presentation noted.

Investor interest reflects this project growth. In August this year, Surat-based Sakhiya Skin Clinic filed for an IPO to raise ₹61.72 crore, about ₹50 crore of which 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 around $65 million (approximately ₹530 crore).

Shenai, the ex- Lakmé honcho, summarized the veteran view when he peered into the future. “I think everything will co-exist. It’s like AI (artificial intelligence), it won’t take away jobs, but people who use it smartly will take away opportunities from those who don’t."

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