Varun Alagh on Distribution Moats

By January 2024, Mamaearth had opened its 100th Exclusive Brand Outlet (EBO) at R-City Mall in Mumbai — achieved in under three years since the first store opened in early 2021. Honasa positions this as a key step in its omnichannel evolution, supplementing distribution across 100,000-plus FMCG retail outlets and 18,000-plus pin codes in 700-plus districts.

A second critique was structural: Kuruganti argued Mamaearth was 'no longer a D2C brand,' pointing to a sharp shift in offline channel contribution from 9% in 2020 to roughly 35% in the prior six months. His objection: you cannot ask for a D2C valuation multiple while explicitly planning to derive 70% of business from offline channels in the near term.

On the offline-versus-online split, Varun acknowledges that the larger share of category transactions still occurs in physical retail. He announced plans to add roughly 40,000 stores to the offline footprint in that year, having just opened exclusive brand outlets in Delhi, Gurgaon, Noida and Mumbai. Online contributed roughly 70% of revenue and offline 30% at the time — a ratio that would later feed the IPO-era critique that Mamaearth was no longer truly a D2C brand.

Tier-II and beyond markets emerge as a central growth axis: Varun reports that more than 50% of total sales come from these towns, served across roughly 19,000 pincodes, with active offline expansion targeting the same geographies. This refutes the assumption that premium D2C beauty was metro-only and explains Honasa's broad-based reach claim.