The attraction of beauty for start-up brands is obvious. It’s a growth industry that responds well to innovation, appears to be immune to economic instability and is relatively easy to get into.
For many newcomers, the dream and kudos of eventually being bought out by one of the multinationals must also be a motivating factor.
Of course, the reality is quite different.
Getting started is the easy part. All that’s needed is a good idea, preferably with a USP and enough money to invest in the production process to get the brand ready to launch.
Many start with their own website but moving up to the next level requires a completely new skillset.
Retailers are regularly swamped with requests from new brands looking for representation, but the majority fail to do their research, so never make it to see the buyer, let alone onto the shelves.
What Retailers Want
Having worked as a category buyer for Boots for many years, Helen Miller, managing director of Helen Miller Consulting, has seen many brands approach retailers without a properly conceived distribution strategy.
“So they go to the wrong retailers and say the wrong things,” she maintains.
A common error for brands who have made it through the door is that they have failed to look at what the retailer currently sells and how their brand compares.
“Know the answer to ‘why should my customers want to buy your brand instead of the others I already stock?’”, advises Miller. “Tell the retailer why their customers will want to buy your brand. That’s your brand proposition in one sentence.”
Preparation for the meeting is vital and that includes presenting a 12-month marketing plan showing what a brand can do that is special or exclusive for the retailer.
Perhaps Miller’s most important advice is for brands to know what they can and cannot afford before they meet the buyer, and to stick to their guns.
Routes to Market
Since 20013, Supply & Buy has offered the smaller independent brands an alternative route to market.
Described as a pop-up boutique for brands to present to buyers, the event takes place in London each June and brings together pre-selected companies it considers to be commercially viable with beauty retailers, ranging from Boots, Debenhams and John Lewis to independents, such as John Bell & Croyden, and home shopping channel QVC.
“Most of the brands that participate already have some distribution, even if it’s just their own website. They are looking for their next move,” comments Supply & Buy founder and organiser, Jonathan Charles.
From the retailers’ perspective, it’s an opportunity to meet a select group of emerging brands over the course of one day.
“The retailers who come have a gap in their portfolio and are looking for a particular type of brand. It’s a way of seeing what’s up and coming.”
Brands that have recently sealed successful deals include solutions-focused skincare brand Science of Skin, peel-off nail polish brand Little Ondine and high protection self-bronzer Tancream.
Retailers’ Eye View
However, the number of indie brands that make it into the big retailers is small. Backing a new brand carries risk which few are prepared to take, accustomed as they are to being supported by big brands with deep pockets.
Smaller brands need more care and attention and do not have the larger budgets of their competitors to invest in education and in-store staffing.
One champion of indie beauty brands in retail is John Bell & Croyden, based in Wigmore Street, London, which carries a large range of niche brands, some on an exclusive basis.
“If our customers wanted ‘masstige’ brands, they can go to most department stores along Oxford Street and get a similar offering of big juggernaut brands with huge PR and marketing spends. However we like to offer something different,” explains Daniel Gill, buyer & category manager, John Bell & Croyden.
The retailer prides itself on its level of knowledge and expertise, particularly in skincare, which Gill considers to be unrivalled.
“Our staff do not get paid commission or incentives, therefore truly recommend the best product for the customer’s needs -a definite rarity in this field,” he believes. “This allows our staff to recommend newer indie brands with conviction and understanding.”
John Bell & Croyden’s best-selling brands include SkinCeuticals, Dermalogica, Niod, The Ordinary, La Roche Posay, Bioderma, Penhaligon’s, Zelens, Darphin, Korres and 4711.
Many of these would have been considered quite indie a few years back, but as consumer knowledge increases, they have become better established.
Two more examples are REN, which John Bell & Croyden took on years go when they were quite niche, and Aromatherapy Associates. Both are now huge forces in the beauty industry.
When selecting new brands, Gill looks for uniqueness, good formulation, strong packaging, premium/luxury positioning, brand awareness or showing the potential to have good brand awareness in the future.
New on the shelves for autumn 2017 are SkinDesign London, Själ Skincare and Aestheticare Endocare CellPro, each chosen for their unique proposition.
However, before any new skincare brand makes it onto the shelves, it is compulsory for staff to be fully trained in order to sell the product features convincingly.
Brands’ Eye View
Jenni Retourné, a former beauty magazine editor, has used her knowledge of the industry and experience with working with small to medium beauty brands to launch her natural range called Willowberry.
Rather than follow in the footsteps of so many new skincare brands making natural claims, she researched how health and wellbeing affects the skin, mind and body. She learned that using natural nurturing ingredients can change the look of the skin and how it feels which impacts on the user’s wellbeing.
“I know it’s a hugely competitive market, but it didn’t deter me one bit,” explains Retourné. “Willowberry’s tagline is ‘Your Skin’s Wellbeing’ and I believe that this taps into a new area for beauty. But all trends come and go, so I don’t believe in launching a brand based on a trend -it has to run deeper than that and have those values at its core.”
Having a strong brand story is key to getting noticed.
In 2004, Matthew Malin and Andrew Goetz launched their modern apothecary approach to luxury skincare when they opened their New York boutique. Both were very involved in the brand, in the technology behind the advanced natural formulations, and initially would serve every customer who walked though the door.
Today, the brand remains independent, but has grown internationally, with stores in New York, Los Angeles and London.
“Malin + Goetz is an extension of our respective careers in beauty and design and felt like a natural next step. Also, ‘partnering’ (we are partners in life and business) was and is key for us and we complement one another’s skills and interests,” explains Matthew Malin.
The brand concept is based on a family-run business that makes skincare easy with a focus on sensitive skin. Its gender-neutral positioning from day one created a USP which is becoming more widely used in beauty today.
“We wanted to offer full clarity,” stated Lavabre. “There are many beauty companies that do not offer fully certified organic products. When you really look at what is in them, many of the ingredients would be banned by a certifying body such as COSMOS Soil Association.”
The current line up of KINN products includes organic body and bath toiletries and natural eco-friendly cleansing products for the home, with more in the pipeline.
Premium bodycare and fragrance range Malée is based on the rich landscapes, scents and wisdom of Africa and is formulated with 100% natural active ingredients scientifically proven to nourish and care for the skin.
Founder, Zeze Oriaikhi-Sao hit on the idea for the range when she was living in South Africa and discovered the country’s natural resources, including gold, diamond, flowers, fruit, tea, chocolate, coffee, which have a long tradition of community and beauty routines amongst the local people.
“I encountered in every tribe a sense of pride in being the best groomed, having the best herbal ‘remedies’ and having the heritage through unwritten formulations. I wanted to celebrate it,” explains Oriaikhi-Sao.
Hidden Costs and Pitfalls
Passion and commitment shine through in all these examples, but the truth is that many do not make it beyond their first year. A lack of funds and time are the most common complaints cited by brands.
“Money is a huge issue. It costs enough to start a business with a small inventory, so when you scale up the cost it can become quite daunting. And of course PR, marketing events, etc, all cost money too,” states Retourné.
In her previous role as beauty editor, she has seen many amazing brands that never get the exposure to make their business a success.
“You can create the best brand in the world but if you don’t know how to market it, how can anyone even know it exists?” she argues.
According to Lavabre, the key element to keeping on track is to be surrounded by the right people, team members and mentors.
“The knowledge they can give you is invaluable and often challenges you to think outside the box and not become too snow-blind by your own ideas,” she says.
Beyond survival comes the decision on whether to move the business up to the next level.
“Scaling the business, while remaining true to its roots, is a challenge. We’re up for it,” confirms Malin, who admits that he and Goetz have made a lot of mistakes along the way, but that so much has happened organically and to their ultimate benefit.
Malée has achieved what many indie brands have failed to by expanding into five countries while continuing to grow. However, Oriakhi-Sao admits she would have hired best-in-class staff sooner.
“Attracting the right talent and building a consistent team to execute for speed is the biggest challenge,” she states.
“As teams scale up and you get contractors and suppliers on board, it becomes a whole different business,” maintains Retourné. “It is vital to keep control of the business and maintain the brand’s core value during the growth phase.”
She says it is better to grow slowly with integrity than to chase numbers and sales and intends to create a tight edit so that each product is special, with nothing done for the sake of it.
Research, planning, overestimating costs and underestimating sales are essential for start-ups looking to break into beauty. When Retourné was about to launch Willowberry, an industry friend said to her – Own It.
She continues to remind herself of these two little words daily.
“I need to own my space in the industry with conviction, so I would advise others to do so too.”
This article was first published in SPC Magazine, volume 90 number 11.
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