How to Build an Independent Beauty Brand | Case Study

Independent magnificence manufacturers in current occasions have discovered what has eluded resource-rich conglomerates for years: how to not solely promote to customers, but in addition serve them with distinctive merchandise and experiences whereas constructing communities on-line and off.Founder owned-and-operated manufacturers have lengthy been a presence within the trade. But the 2010s ushered in a golden age for impartial labels. Spurred by the direct-to-consumer growth and the emergence of e-commerce platforms like Shopify, it was simple for these start-ups to open their on-line storefronts, whereas eliminating the necessity to pitch to wholesale companions.The rise of social media additionally helped. For one factor, social media promoting was comparatively low cost, permitting unknown manufacturers to shortly purchase prospects. For one other, social media grew to become a spot for manufacturers to join with customers instantly, creating on-line “communities” of loyal prospects who comply with and interact with the model, sharing its virtues with their very own followers. On Instagram, specifically, founders might turn into instantly recognisable as their model’s public face, and talk about the efficacy of their merchandise and the worthiness of their missions.Industry incumbents had been fast to recognise the risk. Brands owned by Estée Lauder Companies, L’Oréal, Procter & Gamble, Puig and Coty had identify recognition, however struggled to resonate with customers, significantly the youthful ones. Attempts to launch their very own indie-inspired manufacturers principally flopped. So they embraced a time-honoured strategy: in the event you can’t beat them, purchase them. Most, if not all, of those massive manufacturers have acquired at the least one impartial magnificence model lately.“If you had been to come out with an impartial model 20 years in the past, the priority would have been that you just’d be squashed by L’Oréal or Estée,” stated Sonya Brown, companion at Norwest Venture Partners. “Today, the tables have turned. These impartial magnificence firms are those which might be on the forefront of innovation and progress. And the large conglomerates proceed to be acquisitive, which is likely one of the causes [venture capital and private equity] traders proceed to assist the house, as a result of there’s a identified exit path.”Today, the infrastructure exists for indie manufacturers to hit it massive shortly: increasingly more manufacturers will launch bolstered by enterprise capital funding, and retailers like Sephora and Ulta Beauty are prepared to give buzzy younger manufacturers shelf house, even after solely a yr or much less in enterprise. But there are numerous extra manufacturers vying for funding and spots on retailers’ cabinets, together with labels based by influencers and celebrities together with dermatologists and make-up artists. Competition is extra intense than ever.This case research unpacks what it takes for an impartial magnificence model to stand out and develop by inspecting classes from three indie start-ups: skincare label Glow Recipe, hair care model K18 and perfume purveyor D.S. & Durga.Glow Recipe — based by former L’Oréal workers Christine Chang and Sarah Lee in 2014 — jumped on the booming Korean Beauty pattern with its fruit-inspired merchandise in 2017. The founders spoke with BoF about how their group considers the best way a product seems on-line from the get-go, at its formulation stage, in addition to how they’re in a position to shortly reply to tendencies and tailor communications to explicit channels. In August 2022, Bloomberg News reported that the model tapped funding financial institution Goldman Sachs to advise on its sale, at a valuation of between $400 million and $500 million.Fragrance model D.S. & Durga debuted in 2008, at a time when David Moltz readily admits as we speak that he and co-founder (and spouse) Kavi Moltz had little enterprise expertise. The founders leaned closely on conventional ideas of brand name constructing to create a “character” for each perfume of their portfolio, pairing every with a playlist so as to spotlight its connection to and inspiration from music. It’s a multi-sensory strategy that has helped D.S. & Durga attain its objective of sustained progress — its gross sales have elevated by 90 p.c yr on yr since 2020.As a brand new entrant in a sizzling class, having arrived on the scene in 2020, hair care label K18 supplies proof that regardless of larger competitors, it’s doable for impartial manufacturers to scale shortly. Launched on the peak of the pandemic, the model leaned into TikTok virality to assist its signature product, the Leave-In Molecular Repair Hair Mask, fly off cabinets. Sales in 2022 — its second full yr in enterprise — are anticipated to exceed $125 million.For many impartial magnificence manufacturers, the promise of a profitable exit is a significant motivator by way of the ups and downs of entrepreneurship. But because the three manufacturers on this case research exhibit, there’s no avoiding the pre-exit heavy lifting.Click under to learn the case research now.

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