Direct-to-consumer (D2C) brands in India took off by selling online, but a new “offline revolution” is underway. After conquering Instagram feeds and e-commerce platforms, many funded D2C startups are opening physical retail stores. From cosmetics to coffee, brands are finding that brick-and-mortar locations can supercharge trust, customer experience, and sales. This trend is especially visible with companies like Mamaearth, Blue Tokai Coffee, and abCoffee, which are rapidly expanding their offline presence. Below, we explore why these startups are betting big on retail spaces and how experiential stores are driving growth.
Building Trust Through Brick-and-Mortar Presence
One key advantage of having physical stores is the boost in brand trust and credibility. In India, consumers often feel more confident buying from a brand that has a tangible presence in their city or neighborhood. A store serves as proof that the company is “legitimate and invested” – it reassures customers about product authenticity and quality. Shoppers can see, touch, and try products in person, which addresses any skepticism they might have had when seeing the brand online. This tangible experience reinforces trust in ways a website alone cannot.
Crucially, offline channels also expose the brand to new customers who might not be active online. As Varun Alagh, co-founder of Mamaearth’s parent company Honasa, points out, 90% of many product categories’ sales in India still happen offline. Brands that stay online-only risk missing a huge segment of buyers. Being present on retail shelves or having a dedicated outlet increases visibility and signals that the brand is here to stay. According to a Financial Express report, expanding offline helps D2C brands establish credibility among consumers who may be sceptical of online-only sellers. In short, a brick-and-mortar footprint can make a young brand look and feel as trustworthy as an established player.
Elevating Customer Experience with Experiential Retail
Beyond trust, physical stores enable richer customer experiences that are hard to replicate online. Many D2C startups are embracing “experiential retail” – designing stores not just to sell, but to offer an engaging brand experience. This could mean interactive product demos, knowledgeable staff guidance, or a unique store ambiance that reflects the brand’s story. The goal is to immerse customers in the brand’s world from the moment they step inside.
Such experiential retail is proving to drive higher conversions. When customers can touch, feel, or taste a product, they are more likely to purchase. Offering an immersive in-store experience often leads to increased conversion rates and even fewer returns, since shoppers make more informed choices. For example, a cosmetics D2C brand can set up beauty bars in-store for customers to try products, increasing the chance they’ll find the perfect match and buy. A fashion startup might host styling sessions or use AR mirrors to let shoppers virtually try outfits. These experiences not only convert browsers into buyers on the spot, but also deepen customer loyalty.
Cafés and experience centers are another form of experiential retail. Consider Blue Tokai Coffee Roasters, which started as an online coffee brand and then opened cafés. Blue Tokai’s cafés serve as both retail outlets and experience hubs – customers can watch coffee being brewed, attend tasting workshops, and learn about sourcing, all while enjoying a cup. This model has paid off: the majority of Blue Tokai’s revenue (around 70%) now comes from its cafés (offline channel). By creating a welcoming space for coffee lovers, Blue Tokai isn’t just selling coffee, it’s selling an experience – and that experience converts visitors into loyal customers.
Notably, experiential stores can also create buzz and word-of-mouth marketing. A well-designed, Instagram-worthy store or a unique in-store event can get people talking about the brand. This organic hype further drives sales both offline and online. In a competitive market, offering a memorable in-store experience has become a savvy way for D2C brands to differentiate themselves and drive foot traffic that translates to revenue.
Success Stories: D2C Brands Thriving Offline
Real-world examples in India show how going offline is boosting D2C businesses. Let’s look at how funded startups like Mamaearth, Blue Tokai, and abCoffee have leveraged retail spaces:
Mamaearth: From Online Baby Care to Nationwide Stores
Gurgaon-based Mamaearth built its name as a digital-first, toxin-free personal care brand. But as it grew, Mamaearth aggressively expanded into offline retail to reach more consumers. In the last couple of years, the company launched around 85 exclusive brand outlets across Indian cities. Additionally, its products are now distributed through over 150,000 general and modern trade stores nationwide. This omnichannel push has paid dividends – Honasa Consumer (Mamaearth’s parent) derived about 35-36% of its sales from offline channels in FY23. Mamaearth has become a ₹1,000+ crore brand, and much of this scale comes from its presence in physical retail.
Mamaearth’s CEO has noted that offline is now the larger segment of their business and will keep growing. By opening branded stores, Mamaearth gives customers a chance to discover and try products in person – for example, a parent can walk into a Mamaearth store and sample a baby lotion before buying, which greatly enhances trust. The brand’s retail outlets also serve as marketing billboards in high-traffic areas, keeping Mamaearth visible. This strategy of “clicks to bricks” has solidified Mamaearth’s position in the market and even aided its recent IPO plans. The takeaway: a strong offline footprint has helped Mamaearth broaden its customer base and revenue far beyond what online-only sales could achieve.
Blue Tokai Coffee: Brewing Growth Through Cafés
Homegrown Blue Tokai Coffee Roasters is a standout example of a D2C brand that scaled via experiential retail. Launched as an online specialty coffee seller, Blue Tokai soon opened small cafés to let people savor its brews. These cafés doubled as experience centers where customers could witness coffee roasting and brewing techniques. Fast-forward to today, and Blue Tokai has 80+ outlets across major cities (and even internationally in Japan). The startup has attracted significant funding (over $30 million in 2023) and is planning to open around 100 stores every year for the next few years. The ambitious goal: to become a ₹1,000 crore revenue brand by 2027 while maintaining healthy profit margins.
What’s driving this confidence is Blue Tokai’s proven success offline. Its café revenues have given the company a current annual revenue run rate of about ₹400 crore, with offline café sales contributing the lion’s share. Essentially, the more Blue Tokai has invested in cafes and retail presence, the more its sales have multiplied. The brand has even launched large-format 2,000 sq. ft “Origins” experience centres to deepen the customer experience. By creating a community space for coffee enthusiasts, Blue Tokai increases dwell time and customer engagement – people might come for a coffee, but leave with a bag of freshly roasted beans and a lasting fondness for the brand. This experiential retail strategy is directly driving conversions and repeat sales, fueling Blue Tokai’s rapid growth.
abCoffee: Scaling the Neighborhood Coffee Experience
abCoffee is another funded startup riding the offline wave. Founded in 2022, abCoffee is a tech-enabled specialty coffee grab-and-go QSR chain that aims to be every neighborhood’s go-to coffee spot. In just 20 months, abCoffee opened 25 outlets across Mumbai and Delhi-NCR, all company-owned. The pace hasn’t slowed – by April 2024, the brand planned to double that count to 50, and it ambitiously targets 150 outlets nationwide by the end of 2024. This explosive expansion is backed by venture funding (the startup raised about $3.4 million in Series A) and is driven by the belief that convenient offline access will grow its customer base.
Early results are promising. abCoffee reports a customer loyalty program with a 61% retention rate, indicating that once people try the abCoffee experience, they keep coming back. The company has strategically placed outlets in corporate parks, residential areas, and high streets to fit into customers’ daily routines. By being physically present where customers live and work, abCoffee is building a strong community-oriented brand. The founder, Abhijeet Anand, emphasizes delivering “exceptional coffee experiences at honest prices” and forging local community bonds. Essentially, abCoffee’s rapid growth illustrates how a D2C brand can use offline stores as a launchpad for scaling up, leveraging both convenience and experience to win customers. It’s turning out that investing in brick-and-mortar cafés is accelerating Ab Coffee’s business far faster than an online-only model could.
These success stories are not isolated. Many other Indian D2C brands are jumping on the offline bandwagon. For instance, Sugar Cosmetics (a digital-first beauty brand) nearly doubled its store count to ~200 outlets in FY23, which helped drive an 89% surge in annual revenue to ₹420 crore. Blending online and offline channels (often called an omnichannel approach) is emerging as the formula for explosive growth.
Conclusion: Omnichannel is the Future
The foray into physical retail by D2C startups marks a strategic evolution in India’s retail landscape. Offline retail is no longer a mere add-on; it’s becoming central to D2C growth plans. By enhancing brand trust and offering immersive customer experiences, physical stores allow young brands to reach new customers and drive conversions in ways that online channels alone often cannot. They also create an additional revenue stream and a touchpoint for feedback and community building. Of course, opening stores comes with challenges – higher operational costs and complexities – but the payoff can be significant when done right.
For Indian D2C founders, brand managers, and retail strategists, the message is clear: the future is omnichannel. An online-first approach can spark a brand, but offline expansion can propel it to new heights. The “offline revolution” is about leveraging the strengths of both worlds – using retail spaces to deepen customer engagement, build credibility, and complement the efficiency of e-commerce. As seen with Mamaearth’s broad retail reach, Blue Tokai’s thriving cafés, and abCoffee’s rapid rollout, investing in brick-and-mortar presence is turning out to be a game-changer. The next wave of D2C champions in India will likely be those who seamlessly blend clicks with bricks, delivering a cohesive experience wherever the customer finds them. In an era of rising consumer expectations, meeting shoppers online and offline is not just an option – it’s a winning strategy for growth.
