Recently, I’ve had the pleasure of having exciting and engaging conversations with several soon-to-be beauty founders. It’s always inspiring to hear their stories and see their motivation to bring a vision to life. I’m grateful for the opportunity to help them achieve this. And in this process, I’ve come to learn more about what it takes to create and launch a beauty brand nowadays.
Here in, I would like to share a few tips on fundamentals that have to be considered before launching a beauty brand:
Know you're why
As with any other entrepreneurial venture, the decision to launch a beauty brand is a big one. It’s a long-term commitment of time and resources. Therefore, it’s important to be clear on why are you launching a brand, what’s your motivation and what higher purpose is the brand serving.
Your “why” serves three purposes: 1) as a catalyst and as an inspiration for unique and creative ideas, and during tough times, as the lift that you need to keep on going, 2) it keeps you focused on your goals, therefore allowing you to make better decisions on all aspects of managing the daily business and 3) provides the clarity necessary to develop the brand’s tone and voice, which you will need to create the brand’s content, both visual and copy.
Decide on a brand positioning and keep an eye on the costs
Part of the conceptualization process of the brand is to decide what consumers you’ll be serving and where they would shop for your brand.
The brand’s positioning will 1) drive your distribution and pricing strategy and, 2) have financial implications on your marketing and product development planning. Especially at the beginning during the product creation phase, it’s critical to have an eye on formulation and packaging costs at all times; if for example, your brand’s intention is to provide highly efficacious formulas while also being clean and vegan, all while selling at mass distribution channels, you’ll most probably have to accept very high COGs, especially at the beginning.
Once your brand positioning has been established, understand your competition’s retail price positioning, gather COG information on your products (either from experience or supplier information), and develop a rough financial model. With a rough financial model, you at least have guardrails and benchmarks to arrive at the product quality you desire while maintaining the margins you want to support your brand after launch. (Note: A high COG can be sustainable if your marketing strategy is inexpensive, say for example, if you already have an established community around the brand)
Build the right team
To launch a beauty brand, you will need to find the right people to help you build the brand. To do this, you need to be clear on your strengths and complement them by sourcing talent to help you. These people can be full-time, part-time, or an agency. And, depending on your expertise, connections, and financial situation, the breadth, and depth of the team will vary.
Once you have a solid brand concept, you’ll need a supplier or a product developer as a product development source. Once this is done, you’ll need a finance lead and a marketer to put together the financial and marketing plans and develop a go, to market strategy. Throughout this process and depending on the product category, you will need a lawyer for legal support. Finally, you’ll need operations lead to put together a supply chain and operational structure to deliver products to retailers or consumers directly.
Content is king
The rise of digital and social media has changed the rules of the game when launching a brand. It’s safe to say that today, no matter how digitally native your brand is, you must have a brand site and a digital marketing strategy, at minimum. And to succeed at leveraging these channels for your brand, content is king.
Make sure your brand’s tone and voice are clear and concise. There needs to be a constant flow of content and depending on your marketing strategy, you’ll need to consider full-time, part-time or an agency to support your creative needs (tip: User Generated Content can also be a great source for content, depending on your brand equity and marketing strategy)
Plan for capitalization
It’s important to plan ahead on potential sources of capital depending on the needs of the business, and as the brand progresses and grows. Unless you have access to cheap or “free” capital (i.e., self-funded), you’ll have to plan for outside sources of funds.
Start building a network of VCs, Angel Investors, and others in advance. Don’t wait until you run out of money, experience unplanned growth, or partner with a key retailer, to then begin your outreach. Also, understand what are the best options for you and what are you comfortable committing to (remember that you might have to give a portion of the company to access capital).
More planning, strategizing and structure building will be required after you launch your brand. Even though having a strong concept and a unique value proposition are pivotal, the aforementioned essentials should prepare you to launch the brand properly and set it up for success. Good luck!
by Richard Vera