GCI Magazine 10 October 2016 by Bel SPA

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CONTENTS

OCTOBER 2016 | VOLUME 184, NUMBER 8

FEATURES 8 How to Refresh a Brand in 5 Months Inside the relaunch of InstaNatural.

10 Going Solo?

5 ways to maximize your single beauty business. BY CHAD HANKINSON

12 The Power of Hyper

40 12

In his own words: Bluemercury cofounder Barry Beck on the changing consumer, the evolution of retail and what it means for brands.

18 The Ethical Matchmaker

A new model emerges for connecting sustainable beauty brands and retailers.

20 Riding the K-wave

Inside AmorePacific’s next phase of global Korean beauty growth. BY LISA DOYLE

24 How to Be a David

What it takes to become a successful challenger brand in any beauty category. BY LAURA ZIV

30 Turning Hair Care on Its Head

How can brands innovate when the old rules no longer apply? BY LISA DOYLE

34 4 Reasons Multicultural Consumers are Driving Hair Care

From natural locks to hair repair, consumers of all ethnicities are inspiring new innovations. BY JENNIFER DONOHUE

40 Can Hair Care Grow?

Despite tepid growth projections for the category overall, opportunities exist for brands to innovate and achieve growth. BY HANNAH SYMONS

44 Think Like a Designer

Applying design thinking can ensure that brands remain cohesive, from packaging line organization to retail. BY SHERI L. KOETTING

www.GCImagazine.com

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CONTENTS EDITORIAL

Director Editor in Chief Associate Editor Assistant Editor

Jo-El M. Grossman Jeb Gleason-Allured | 1-630-344-6069/jallured@allured.com Nicole Urbanowicz | 1-630-344-6053/nurbanowicz@allured.com Jennifer Novoseletsky | 1-630-344-6045/jnovoseletsky@allured.com

ADVERTISING SALES Business Development Manager Kim Jednachowski | 1-630-344-6054/kjednachowski@allured.com Business Development Manager Paige Crist | 1-630-344-6060/pcrist@allured.com Fragrance Coordinator Kasia Smialkowski | 1-630-344-6025/ksmialkowski@allured.com

AUDIENCE DEVELOPMENT Director Linda Schmitt Marketing Specialist Marie Galvan Marketing Assistant Alyssa Howard Customer Service 1-888-399-0899/customerservice@gcimagazine.com

DESIGN

48 Prove It

In-home usage studies put your beauty care brand to the test and yield compelling consumer claims. BY DENISE HERICH

Graphic Design Manager Senior Graphic Designer Production Manager

Lisa Hede Hon Bannapradist Bryan Crowe

CORPORATE

DEPARTMENTS

Partner & President Partner & CEO Controller Group Show Director Digital Products Director Executive Assistant

Janet Ludwig George Fox Linda Getner Sandy Chapin Rose Southard Maria Romero

4 Spark: What is Good Hair?

OTHER ALLURED PRODUCTS

BY JEB GLEASON-ALLURED

6 8 10 12 52 53

Insights & Breakthroughs Brands & Benchmarks Brand Strategies Beauty Channels Ingredients & Claims Packaging Innovations

RESOURCES 54 Products & Services Showcase 56 Advertiser Index

Allured Business Media 1-630-653-2155 • fax 1-630-653-2192 336 Gundersen Drive, Suite A Carol Stream, IL 60188-2403 USA www.Allured.com

Alluredbooks Cosmetics & Toiletries Bench Reference Cosmetics & Toiletries magazine Cosmetics & Toiletries magazine: Portuguese edition Cosmetics & Toiletries Summit Skin Inc. magazine Face & Body Midwest Spa Conference and Expo Face & Body Northern California Spa Conference and Expo Face & Body Southeast Spa Conference and Expo Perfumer & Flavorist magazine World Perfumery Congress Flavorcon

Subscriptions: Subscribe online: www.GCImagazine.com/subscribe In the US, telephone: 1-888-399-0899, Outside the US, telephone: 1-847-559-7557 (9 AM–5 PM Central, Mon-Fri) | Fax: 1-847-291-4816 E-mail: customerservice@gcimagazine.com Print subscriptions: Available free to qualified individuals located in the United States. All other countries may subscribe to the digital edition. Periodicals Postage paid at Carol Stream, Illinois, and additional mailing offices. Change of address: Give both the new and old addresses. Allow two months for a change to become effective. Global Cosmetic Industry (ISSN 1523-9470) is published ten times per year as Jan./Feb., March, April, May, June, July/Aug., Sept., Oct., Nov. and Dec. issues by Allured Business Media, 336 Gundersen Drive, Suite A, Carol Stream IL 60188-2403 USA. Copyright 2016. Free subscriptions to Global Cosmetic Industry are available to qualified individuals. The publisher reserves the right to determine qualification of free subscriptions. Replacement issues are available only through single copy sales. Single copies: $20; GCI Directory Issue: $35 (Add $10 per order shipped to Canada; add $15 per order to all other countries.) Periodicals postage paid at Carol Stream IL 60188 and additional mailing offices. POSTMASTER: Please send address changes to Global Cosmetic Industry, PO Box 3009, Northbrook, IL 60065-3009. Change of address: Give both the new and old addresses. Allow two months for a change to become effective.

Members of the American Business Media. All correspondence regarding business, editorial, advertising and production should be sent to Global Cosmetic Industry, 336 Gundersen Drive, Suite A, Carol Stream, IL 60188-2403 USA.

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Allured Business Media makes all attempts to publish accurate information; however, this publication may contain technical inaccuracies or typographical errors. The reader assumes all risks concerning the suitability and accuracy of the information within this publication. Allured Business Media assumes no responsibility for and disclaims all liability for any such inaccuracies, errors or omissions in this publication and in other documents referred to within or affiliated with this publication. www.GCImagazine.com

2 Contents GCI October 2016

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SPARK

n BY JEB GLEASON-ALLURED

What is Good Hair?

W JEB GLEASON-ALLURED Editor in Chief jallured@allured.com @GCI_Magazine

GCI MAGAZINE EDITORIAL ADVISORY BOARD ALISA MARIE BEYER

Coastal Salt & Soul

MARIE ALICE DIBON

Alice Communications, Inc.

ADA POLLA

Alchimie Forever, The Polla Beauty Group

ART RICH, Ph.D.

A. Rich Development

RICK RUFFOLO

R4 Innovations

CRISTINA SAMUELS

Mode Cosmetics

LAURA SETZFAND Epiphany

hat’s interesting about hair care isn’t whether it’s growing, but how and why. The global market for shampoos and conditioners and color and styling products is forecasted to grow from $83.1 billion this year to $94.5 billion in 2021, according to figures from Trefis, while Technavio is calling for 3% annual growth through 2019.* Top segments, from largest to smallest, are: premium shampoos, hair gels and hair accessories, according to a Euromonitor analysis**. The global hair care market is expanding due to increasing adoption of grooming and styling regimens in newer markets, particularly India and China, according to Technavio, while aging consumers in mature markets are also driving demand. Euromonitor also notes that the rise of male grooming is leading to an expanding consumer base among men. But beyond the demographic shifts, hair care is experiencing a cultural reckoning, particularly in the multicultural/textured hair space. The segment is critical to the hair care segment in part because consumers with textured hair—curly, coily and wavy— spend more than their straight-haired counterparts, and are highly motivated to try new products, according to research from TextureMedia LLC***. More importantly, consumers with textured hair, especially women of color, are pushing back against historically narrow definitions of “normal” and “good” hair. This movement is the subject of SheaMoisture’s recent #BreakTheWalls campaign, which has pushed the beauty standards conversation to the fore. “With ‘What’s Normal?’ we are confronting the mental walls that encourage us to force-fit ourselves and others into falsely constructed beauty and ‘good hair’ ideals,” said Richelieu Dennis, founder and CEO of Sundial Brands. “By questioning the very concept of a normal standard, especially as it applies to beauty and to hair type or texture, we can begin to see how arbitrary, narrow and potentially destructive it is and course-correct ourselves on a path to where everybody gets love. Our forward track must focus on including everyone, embracing everyone, and celebrating the beauty—and normalcy—of everyone’s differences.” #BreakTheWalls has presented a new level of visibility to this issue, and Dennis and other like-minded beauty care stakeholders and consumers are poised to reshape not just the hair care aisle, but also the industry’s and society’s mindset. It’s about time. See you next month.

*www.trefis.com; www.technavio.com **www.euromonitor.com ***”Hair Care Brands Should Organize Around Texture”; www.gcimagazine.com/marketstrends/segments/ hair/Hair-Care-Brands-Should-Organize-Around-Texture--384582471.html

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4 Spark GCI October 2016

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INSIGHTS & BREAKTHROUGHS Shape-shifting Beauty As we saw at the 2016 in-cosmetics events in Paris and New York, texture-shifting products are heating up, allowing products to evolve from one state to another, such as transitioning from a foam to a liquid. A new analysis from Mintel (www.mintel.com) notes that a focus on texture can improve the consumer experience of moisturizing color cosmetics, which could eventually incorporate textures such as jellies and waters that improve spreadability and absorption. Other transformations could include a cream or oil that could metamorphose into a powder, according to the Mintel analysis.

Don’t Forget the Moms

It’s hard to be a parent, but harder to be a mother. Despite advances in gender equality, the reality is that, in heterosexual relationships, women, regardless of employment status, do the majority of the work around the house. (Likely no woman reading this is surprised.) Unsurprisingly, then, Kantar Worldpanel (www.kantar.com) has found that mothers have fewer “personal care occasions” than their childless counterparts, despite the fact that mothers over-index for issues such as sagging skin. This is an opportunity for smart brands to encourage mothers to incorporate self care into their daily lives. On the other hand, younger mothers do visit salons more than their childless counterparts, spend more time on their hair and generally pursue habits that promote youthfulness. At the salon, young moms are more likely than their childless counterparts to get the works, including manicures and eyebrow waxes. So it’s clear that mothers appreciate pampering. The question is: Can brands convince mothers of all ages to bring this into the home?

Welcome to Peak “Dupe” @MakeupGuides recently tweeted: “NYX ‘VANILLA SKY’ IS A DUPE FOR NARS ‘ALBATROSS.’” At press time, the comment had more than 1,700 retweets and more than 3,600 likes. In the age of niche, limited-edition makeup brands that sell out in minutes or seconds, it’s no wonder that those left out will seek similar alternatives, or dupes (duplicates). As a result, there are countless resources dedicated to locating dupes, including Temptalia’s dupe list, BuzzFeed’s dupe coverage and the Pinterest Beauty Dupe resource. As we know, many consumers are less and less likely to remain brand-loyal, meaning dupes (aka: metoo’s) create new opportunities for brands to snatch consumers from the competition. Racked has a fantastic deep-dive into the current dupe mania*, but Global Cosmetic Industry did some digging into the data. As Racked noted, Google searches for “makeup dupe” have hit a new peak this year, but things get really interesting when you begin to look over the search terms. The top brands associated with “makeup dupe,” in order of search rank, were: • MAC • Make Up Forever (including Make Up Forever HD) • Makeup Geek (including Makeup Geek eyeshadow) • NYX • NARS • Makeup Revolution (including Makeup Revolution palette) • Sephora • Urban Decay • e.l.f. • Too Faced • Anastasia Beverly Hills • Sigma Beauty The top non-brand keywords appearing in “makeup dupe” searches included: drugstore makeup, makeup brushes and cheap.

6 Insights & Breakthroughs GCI October 2016

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BRANDS & BENCHMARKS How to Refresh a Brand in 5 Months

s InstaNatural—a pureplay e-commerce natural skin and body care brand—entered its third year on the market, chief marketing officer Ethelbert Williams set about revamping its packaging and formulations ahead of a multichannel expansion. He did so in five months. Williams told Global Cosmetic Industry that InstaNatural’s products, including aromatherapy and hair care items, have been selling via the brand’s website; it is also one of the best-selling beauty brands on Amazon in the United States, with rising sales on the retailer’s German, French, Spanish and Italian sites.

Engaging the Consumer To capture a piece of the $36-billion skin care market (manufacturers’ level, according to Kline), Williams set about creating a brand experience online for shoppers who discover and buy beauty in the digital space. Williams was careful to scale the brand to ensure it was consistent and relevant across channels. According to Williams, as many as 58% of beauty category consumers have an initial brand touchpoint online. In the social and digital space, where consumers rely on ratings, tips and tricks, InstaNatural created blog content to establish itself as an information resource. The brand hosts a studio in its Central Florida headquarters, which features a sink and living room, camera and lighting equipment. Content and tutorials can be shot and posted quickly to keep shoppers engaged. InstaNatural also curated reviews to enhance its visibility and became more agile on social media.

Expanding the Channels Under Williams’ guidance, InstaNatural transformed into a multichannel brand that partners with retailers such as Walmart, where its moisturizers, facial cleansers and collection (including deodorant) are available; Walmart-owned Jet.com, which Williams says is “growing like crazy;” and, of course, Amazon. The expansion has been rapid, Williams explained, with InstaNatural moving from vendor review to launch with Walmart.com in about 90 days. Williams restructured the InstaNatural team around talent that understood that the digital landscape is changing rapidly. While the brand is largely focused on e-commerce at the moment, it is building a multichannel future and will launch in at least eight new channels by the end of the year.

Redesigned Packaging Williams thought about how the brand looked “on the digital shelf,” and so redesigned the line to, in the brand’s words, “reflect [InstaNatural’s] commitment to using naturally derived ingredients and delivering effective products with excellence.” The new packaging features a clean design with a visual signature of a bold bird of paradise flower to evoke “magnificence, excellence, success and optimism.”

Ingredient Focused Today’s consumers aren’t brand-loyal, said Williams. Instead, shoppers tend to focus on ingredients and are likely to use the search box to discover brands. Which is why, for example, InstaNatural highlights vitamin C in its serum and cleanser product. Consumers increasingly believe that what they put on their skin is as important as what they put in their body. As a result, InstaNatural rebooted its formulations for the “discerning shopper,” as Williams put it. InstaNatural’s new formulations “have even more power than before to deliver naturally, radiant skin,” according to the company. The range includes the Vitamin C Cleanser ($21.97), InstaNatural Vitamin C Serum ($17.95), InstaNatural Vitamin C Moisturizer ($19.97) , InstaNatural Glycolic Cleanser ($19.97), InstaNatural Moroccan Rose Water ($13.97) and InstaNatural Fractioned Coconut Oil ($13.95). The company will introduce new product innovations later this year as its retail footprint expands.

LuxePop Electrix has launched at Walgreens, offering an array of neon colors, including Shocking Sunshine, Electric Kale and Currant Current, all with an MSRP of $3.99. The fast-dry formulations offer a satin finish with a specially designed base coat and top coat.

8 Brands & Benchmarks GCI October 2016

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Matrix Color Sync Watercolors is taking a cue from Pantone’s 2016 colors of the year, Rose Quartz and Serenity, with its range of demi-permanent pastels and bright vivids that last through up to 20 shampoos. The iridescent Watercolors come in five shades: Moss Green, Sapphire Blue, Berry Violet, Quartz Pink and Coral Peach.

StriVectin has trademarked Tech Neck for its line of neck products, which reportedly tighten, lift and smooth lines, counteracting the effects of repetitive mobile device usage on neck skin. The range, which includes the Advanced Light Tightening Neck Cream, Advanced Tightening Neck Cream and Tightening Neck Serum Roller, comprises the brand’s skin-barrier-defending NIA-114 formulations.

www.GCImagazine.com

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Lancôme has introduced a bespoke makeup system, Le Teint Particulier Custom Made Makeup ($80 for 0.7 oz), in nine U.S. markets, exclusively at Nordstrom. The process is simple: a Lancôme beauty adviser scans the customer’s face to accurately determine her skin tone and then generates a customized foundation blend with a Complexion ID printed on the bottle for reference for refills.

Fragrance startup Phlur (presumably a phonetic twist on the French word for flower) has raised a total of $4.5 million to fund its own disruptive take on digital fragrance marketing for its range of fragrances, which can be sampled ($10 for two samples) and/or purchased in whole ($85 for 50 mL/1.7 oz.).

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BRAND STRATEGIES

GOING

SOLO? 5 ways to maximize your single beauty business.

| BY CHAD HANKINSON, Stylie

he thirst for greater flexibility and control in the workforce is translating into an increase in selfemployment in the United States, and the $20-billion beauty industry is leading the charge*, making up more than one third of all independent workers. However, being a one-person business owner can be scary. Work can pile up and managing it all can add stress and lower productivity. For those thinking about taking that leap of faith, here are five need-to-knows that will help maximize your time and income as an independent worker.

• Bookkeeping: Be smart about your money by accounting for expenses, identifying waste, prepping for taxes and making frugal decisions. • Scheduling: Win customers back by allowing them to set and access appointments quickly. • Inventory processing: Before every appointment, make sure you have everything you need for clients and retail sales. • Education: Put aside time to master new skills and refine existing ones to outperform competitors.

2. Branding 100: Finding Your Distinct Image 1. Build A Robust Foundation A stable empire requires a steady foundation, and making early decisions about the type of business you want to build will do wonders to simplify operations in the long run. Pursue your vocation in a buoyant and vigorous manner by establishing the following frameworks cohesively: • Client communications & nurturing: Focus on unique ways to instill a first-rate experience at every interaction. Make each client feel like royalty—or, better yet, Beyoncé. Either way, this will boost client satisfaction and retention for greater profits. *http://www.sun-sentinel.com/business/consumer/fl-salon-

entreprenours-20151015-story.html

Brand Strategies

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In the past decade, self-employment in the beauty industry has grown by 93%**. This massive growth makes it vital for those trying to penetrate the marketplace to both establish a distinct brand for themselves and to garner traction to their business. To determine your brand strategy, define your mission, business persona and the type of customers you want to attract, and pinpoint what differentiates you from competitors. Once messaging is finalized, leverage various platforms to spread your brand’s proposition. Not only will this help determine which avenues generate the most conversions, it will also develop a compelling community presence and client base.

3. Plumping Up Your Calendar Self-employment doesn’t have to be a feast or famine. Ensure a steady workload and income by feeding your calendar on a regular basis. GCI October 2016

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For long-time beauty professionals who are going solo, leverage your current client list as a starting point. This baseline will ensure your volume will sustain your new business in its early days, as well as establish a steady foundation to build on. For rookies, try cultivating a client list by offering a free service. The generous offer, coupled with your candor, will be irresistible, unlike run-of-the-mill discounted prices. Incentivizing referrals, like offering a free service for every three new people a client sends your way, is another way to plump up your schedule while building rapport with patrons. In addition, leverage social media for your business by posting fresh, frequent updates about your services, promotions, client interactions and snapshots of your gorgeous work.

4. Leverage Prices as a Growth Strategy A wide spectrum of variables can impact pricing: skill and experience level, the demand for services, clientele, environment—the list goes on. While there’s no hard-and-fast rule on how to set up your pricing, there are ways to leverage prices for your benefit. • Charge more in the beginning: It will take longer to build clientele, but you’ll make more money on average and could maximize your time off, making for a winning proposition in the long run. • Raise prices annually: Clients will expect the raise, especially if you notify customers of a price increase the first week in January. This also helps them associate the change with the end of another year, as opposed to plain old greed or some other unflattering reasons. It also gives them another incentive to take advantage of year-end promotions before the new pricing takes effect. • Charge more for specializations: It took you extra training, practice and effort to deliver that specialized result, so charge it accordingly. Most importantly, be confident in your prices and clients won’t question you.

5. Automating Your Workload In the age of innovation, there is a plethora of time-saving technology that can reduce headaches for the self-employed. Various software systems available today can take the reins on inventory management, scheduling appointments online and more all from a mobile app or tablet. Everything that feels overwhelming at the beginning can be mastered quickly if you’re open to automating the majority of the nitty gritty work. **http://www.finance.senate.gov/imo/media/doc/Professional%20Beauty%20 Association-%202014%20Economic%20Snapshot%20of%20the%20Salon%20 Industry.pdf As a long-time fanatic of independent businesses, CHAD HANKINSON leveraged his extensive experience with innovation as the vice president at New Sunshine to create Stylie (http://gostylie.com), an online scheduling and point of sales (POS) solution for independent hairstylists.

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BEAUTY CHANNELS

Exclusive: The Power of Hyper In his own words: Bluemercury cofounder Barry Beck on the changing consumer, the evolution of retail and what it means for brands.

luemercury recently opened its 100th store in Savannah, Georgia, marking the retailer’s foray into larger store formats. The 2,400-square-foot site, at 110 West Broughton Street, features “a fresh and updated look,” according to the company. The location features more than 70 brands, including Oribe, NARS, Hourglass, RMS, Tara Smith, This Works and Kiehl’s. The company is leveraging the shop-in-shop format to house a Jo Malone fragrance, cream and wash micro store, reflecting broader changes in the beauty retail space. To learn more about the retail innovator’s plans and get a closer look at what’s working in beauty retail, Global Cosmetic Industry interviewed Barry Beck, COO and cofounder of Bluemercury, who provided deep insight into the state of Bluemercury, consumer trends and the broader industry. You can read the an extended version of this Q&A, including an inside look at Bluemercury’s evolution, at www.gcimagazine.com/ marketstrends/channels/other. And now, in his own words, are Beck’s insights. -Editor

Meet Our Customer Our core client is educated, decisive, affluent and comfortable in her own skin. She may be a recent college graduate headed toward her 30s, a new mom, at the peak of her extremely successful career, or an empty nester. She is a millennial, gen Y, gen X or a baby boomer—and we are even starting to get gen Z! Sixty percent of our clients are between the ages of 35 and 64. She is urban and suburban. She visits us a lot—she wants solutions to her beauty problems. At Bluemercury, our business is thriving during this disruptive time in retail history, but in this digital age, clients today have more choices than ever. The customer today demands hyperpersonalization and hypercustomization in their shopping experience.

How We Curate Products We are innovative product curators and cosmetic brand developers. Our approach to product innovation revolves around several core concepts.

READ THE EXTENDED Q&A ONLINE Find the extended Q&A online at www.gcimagazine.com/ marketstrends/channels/other.

Center, from left: Marla Beck and Barry Beck cofounded Bluemercury, which has evolved along with its customer.

The first is newness. Why is new product innovation important? It is a winner-takes-all game. Last year, we launched thousands of SKUs, but only 17% were successful—taking 80% of the revenue. This means approximately 83% of new launches failed to resonate with the consumer. Product proliferation is at a fever pitch. In April alone, we launched more than 20 new products per day. But it’s a double-edged sword. It is about the launching of smart, targeted, effective new products. Also, new products drive traffic and brand building. It is the promise of something new to look at that drives customers into the store or onto your e-commerce site. We see retail as personal and emotional and create and pick products and brands that strike a chord. We spend hours poring over our customer data before bringing in any new brand.

12 Beauty Channels GCI October 2016

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Seeking Innovative Brands We always endeavor to be innovative curators and often look to our vendor partners to help promote creativity, but there have been wrinkles along the way. In 1999, our original vendor partners were entrepreneurs and experimental pioneers like us who we could partially look to for innovation. Within 12 months, the landscape completely changed. The big four in the beauty industry decided to go on an acquisition binge. So instead of doing business with founders and owners, we were now in business with Estee Lauder, Shiseido, L’Oreal and LVMH. So we added more indie brands—Laura Mercier, Frederic Fekkai, Ren and ReVive. And you know what happened then. More acquisitions. Therefore, we are always on the hunt, scrutinizing the product landscape, looking for interesting brands with a point of difference, especially those with long innovation runways of their own.

“[W]e are always on the hunt, scrutinizing the product landscape, looking for interesting brands with a point of difference...” Love is All We Need An important product criteria for us is the search for an annuity SKU. What is an annuity SKU? An annuity SKU is an SKU that clients come in for year after year after year because they love it, it works and they cannot live without it. If you go for this goal, you are really creating consistent traffic and loyalty. Our customers were coming in and asking for a highly effective, natural skin care brand that didn’t have harsh chemicals; the result was the development and creation of our own proprietary brand, M61 Powerful Skincare, the most natural cosmeceutical brand in the beauty industry. Our focus when creating our proprietary brand was to solve the unmet needs of our customers while, at the same time, creating as many annuity SKUs as possible. M61 has become a runaway cult brand success, containing many annuity SKUs and top sellers across our fleet. You may recognize some of these other famous annuity SKUs such as Coca-Cola, Q-tips, Chapstick, Maybelline mascara, Chanel No. 5, YSL Touch Eclat, DDML and Laura Mercier Tinted moisturizer. But, remember, if you don’t cannibalize your own annuity SKU, someone else will. Also, an important product criteria is simply “love.” We take an innovative mindset to our product merchandising and product creation. Our merchandising motto is “love is all we need,” and this is our litmus test! If we love it, our clients will love it. www.GCImagazine.com

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BEAUTY CHANNELS

Innovation is Beauty’s Lifeblood We are not afraid to collaborate with our vendor-partners early in the design process. Sure, you do trade off some confidentiality, but in exchange you get a deeper partnership and increase the likelihood of success. Too often, we are told about a product within six months of its launch, after it has already been misnamed, or mis-priced or is not a need that we have. Our retail teams in the field know our clients and sell the products they love and know. We get involved early so that we can make sure our vendors are developing SKUs our clients will love. For us, partnering with brands is a long-term relationship. We’re not looking for the latest trend that’s hot this year and gone the next. We want lasting, sustained quality. Additionally, we tailor brands to each location, i.e.: Chantecaille is only carried in our new East Hampton location. Also, innovation and ideas drive excitement, energy and engagement on the part of the consumer. One out of every five products we sell each day are new products that didn’t exist a year ago; 50% of the products we sell were created within the last two years. Innovation is the lifeblood of the beauty industry.

She wants to preserve her color-treated hair. She wants to extend her blowouts. She wants the salt water look.

6. Mascara, mascara and more mascara. Mascara is everywhere, and my kids are singing about it in Taylor Swift’s song. Our client tries and uses more mascara than she ever has in the past. She will keep her trusty favorite, but also try anything new. She is keeping one in her office, in her gym bag, and multiples at her apartment or home. 7. Portable coverage with SPF. I now officially predict the death of foundation in a jar. She wants her CCs, BBs and tinted moisturizers. Tubed products with coverage is one our fastest growing categories. She wants them with SPF and she wears them day and night, weekdays and weekends.

What’s Trending? So what’s working today? What’s trending now? What does our client love?

1. Travel treasures and portable sets that make her life easy. Every Trish McEvoy planner and every luxury skin care set that is value-oriented sells out quickly. Our client is time-starved, she travels a lot. She travels for work. She travels on vacation when she unplugs with her friends or family.

Our customers were coming in asking for a highly effective, natural skin care brand that didn’t have harsh chemicals; the result was the development and creation of our own proprietary brand, M61 Powerful Skincare, the most natural cosmeceutical brand in the beauty industry; photo courtesy of Bluemercury Facebook.

2. Escapist giftables. Our consumer and her friends are

cocooning. With Netflix and Blue Apron at our fingertips, you can have great social experiences in the comfort of your own home. When she gives a gift or buys a home fragrance item, she wants it to evoke a journey or sense of place right from her home. Nest Ocean Mist Candle and home fragrance is a runaway success. So is Jo Malone’s Mimosa & Cardamom fragrance. Also, see Molton Brown Tobacco, Lafco Wine Room Candle and Bobbi Brown Beach.

3. Instant, results-oriented skin care, especially multitaskers that don’t break the bank. Powerblast is a recently launched product in our own line, M61. This one-minute, foaming glycolic mask gives great exfoliation, is quick, escapist and fun to use. 4. Sets that think for you so you don’t have to—eye palettes and brush sets. These save her time, solve her beauty problems and make it fun to shop. 5. Hair, hair, hair, hair. “Becky with the good hair” is now a cultural phenomenon. Our client will try anything new in hair.

Did you know the word “foundation” was taken from the “foundation” department where women used to buy girdles and undergarments at a department store? We don’t buy girdles anymore. We buy Spanx. Foundations in a jar will go the way of the girdle.

8. The Uberization of makeup services. We have been doing makeup services for 17 years, and they are exploding at a pace we have not seen in the past. Our stores are booked with gen Z before prom, millennials for their weddings, and gen X before their charity events or evenings out.

How the Consumer is Changing Today, there is excessive fragmentation in the entire purchase process for beauty. A consumer may be inspired by Instagram, a print magazine, a friend, a Snapchat video, a YouTube haul or unboxing, QVC, HSN or Pinterest. She may shop at one of thousands of online beauty sites, pop into a beauty store, pick up something at the airport or at her favorite clothing retailer.

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Information gathering and transaction execution are no longer linear. And, in any industry where there is chaos—when the existing value networks are breaking down—there is opportunity to enter and create real and lasting value. The market is wide open for new innovators and new innovation. Now is the time to create something new. The pace of change in the beauty industry is faster than it has ever been. We are entering new territory together. Generation Z, the future beauty consumers, have fingers that move faster than the speed of light. They learned from Instagram how to click between images and SKUs in ¼ second increments.

“Two years ago, 75% of beauty customers said their behavior was influenced by marketing, while today, only 25% are influenced.” How Bluemercury is Evolving Today, we use our phone while standing on the street to tell a perfect stranger our exact location so they can pick us up. Isn’t this everything your mother warned you about? If you are using Uber, even you’ve been disrupted. Looking through this lens, we are always watchful for these transformative trends that could create new categories and disrupt the current value chain. As our customer recalibrates almost every expectation, here are the five big opportunities I see in the future: 1. Social media shopping will gain even more momentum as people become increasingly connected during the purchase process. Imagine shopping for a lipstick at Bluemercury where all the mirrors are alive and you can get real time opinions from friends and family on your selection. This gives a whole new meaning to the term “peer pressure.” What about a store where people are beaming likes directly from Facebook right to our cosmetic store shelves? Two years ago, 75% of beauty customers said their behavior was influenced by marketing, while today, only 25% are influenced. Traditional marketing will completely decline, and the gap will be filled by social networking, which will be integrated into virtually every step in the buying journey. We have all seen teenagers who buy cosmetics online and then show their haul on YouTube. These haul blogger sites have gone from social networking to serious commerce with millions watching. Beauty bloggers feel so much more genuine than million-dollar ad campaigns, [so] that brands will give them free product, like professional athlete endorsements. In fact, we see that YouTubers were the most influential figures on informing our customers what makeup to buy, eclipsing A-listers like Gwyneth Paltrow. www.GCImagazine.com

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Retailers must actively engage in this global conversation, or their customers will simply begin the conversations without them. 2. Speed will become increasingly important. The average attention span of a human being is eight seconds. The average attention span of a goldfish is actually nine seconds. In this ondemand economy, the customer will require her beauty products now, regardless of where she lives. Advanced robotics such as drone delivery could be reality in five years, facilitating same day delivery to a greater segment of even the most remote customers. At Bluemercury, our dense network of neighborhood stores will act as a last mile distribution hub. In the future, automatic product suggestions based on past behaviors will be shipped to a nearby store before our customer orders it, or perhaps even before she knows she wants it, to make sure that if she does order it, we can get it to her inside the hour. 3. We see a complete role reversal where media will become the store and the store will become the media. The former role of media was to tell a brand story, create interest and drive traffic. For example, ads would say, “go to Bluemercury, our M61 Powerful Skincare Products are there.” Today, you can buy cosmetics from any page of a magazine. They’re not even ads anymore, they’re actually the store.

“The pace of change in the beauty industry is faster than it has ever been and accelerating at warp speed.” The reciprocal is that the store will transition to become an important form of branding, customer relationship [building] and even [an] edutainment vehicle. At Bluemercury, customers come in for skin care education, world-famous treatments and our on-the-go XBar makeovers. Our customers using these services shop with us more frequently and have higher average purchases. Creating rich instore brand experiences and strong emotional connections will drive increased purchase across all channels, including digital. 4. Big data analysis and the internet of everything will transform the way retailers measure their success. Connecting the dots that drive online purchasing will transfer to the physical world.

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Stores will use different customer metrics [that look] more like the web, such as how many impressions, what was the bounce rate, how many abandoned shopping carts and what did they touch? Best-in-class operators will even collect data on where you browsed before you shopped and where you navigated to afterwards. At Bluemercury, we use our point of sale to capture and analyze millions of golden nuggets about our customers. The analysis of these data points helps us in many ways, including marrying targeted sampling to customers whose preferences we are intimately familiar with.

“If we love it, our clients will love it.” Retailers who don’t relentlessly mine and analyze this data render their point of sale to glass hammers with essentially empty calorie transactions. 5. Densification will lead to localization as the world population grows from 6 billion to 9 billion people. On a recent Miami market tour, I was stunned at how long it took to just get from Coconut Grove to Coral Gables; imagine a 30% increase in Miami traffic alone. Intense clustering of customers will drive neighborhood shopping due to perceived convenience and a desire for social connectivity and community. Clients will transact multiple times daily where they live their lives, buy coffee and go grocery shopping. Repeat sales will lead to even more loyalty and more frequent visits. Over time, the smart retailers will realize that physical stores are their most powerful asset. But only those who are able to provide fascinating store experiences and harness the changes in customer behavior will survive, and even thrive, during this disruptive time in retail history. At Bluemercury, we are ready and optimistic about the future.

Correction “Building a Better Retailer: BeautyKind,” published in the June 2016 issue of Global Cosmetic Industry, misidentified the award event at which BeautyKind introduced a pop-up store. It was in fact the ACM awards. We regret the error.

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THE INDUSTRY LEADER IN PATCH TESTING TEST WITH THE BEST! • FDA REGISTERED •

“THE FINE ART OF PERSONAL SERVICE”

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BEAUTY INFLUENCERS

A new model emerges for connecting sustainable beauty brands and retailers.

Finding the right brand-retailer connection can be daunting needle-in-a-haystack process.

∑ Retailers can find the process of vetting brands and assessing wholesale terms costly and time-consuming. ∑ Fledgling brands can find it difficult to get in front of retailers without the intervention of a broker or other middleman, creating cost and resource issues. ∑ By assessing and curating brands, third parties can simplify the retailbrand matching process.

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t can be difficult for a smaller brand, especially one just starting out, to get noticed. Getting in front of a retailer without a broker or distributor—or without investing in an expensive tradeshow—can be daunting. Especially in the booming but fragmented ethical beauty care sector. Similar challenges hold true for retailers. Yes, they want to discover new brands that offer a point of difference, especially those that hold themselves to verifiable ethical standards. But tradeshows, middlemen, and the sheer volume of brands to scrutinize and asses can be overwhelming and time-consuming. Enter Kind Eye (www.kind-eye.com), a two-pronged portal that connects independent ethical beauty care brands and retailers, while also allowing facebook.com/gcimagazine

consumers to search for and purchase products. But can the brand-retailer model really be shaken up?

What Retailers Really Want Rachel Murray, cofounder and CEO of Kind Eye, Inc., recently explained that the platform can provide retailers with a tightly curated list of brands that have been assessed against a list of standards that comprise brand values (ex: charitable giving, use of sustainable packaging, B Corp. status, etc.) and product features (ex: Ecocert, organic status, etc.).* Retailers can customize their searches within the Kind Eye interface to discover brands, presumably saving time. *www.kind-eye.com/about/kind-eyestandards/ Global Cosmetic Industry (GCI)

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Murray noted that retailers are constantly bombarded by brands, creating an inefficient and expensive sorting process. And, while tradeshows can offer a more direct and human connection between retailers and brands, they also come with a time and cost penalty. What retailers really want, Murray told Global Cosmetic Industry, is a vetted list of brands with an established base of knowledge. Murray noted that, by leveraging an external resource, retailers can get themselves out of the “echo chamber” of blogs and social media, which can routinely feature the same set of brands over and over. This can help

retailers to differentiate themselves and bring on new brands that will delight their customers. Kind Eye provides retailers with brands’ wholesale information directly on the site. This allows retailers to know if they can work with brands before ordering a single sample. This can help avoid a painful and time-wasting discovery later in the process that the brand and retailer wholesale minimums won’t match up.

Supporting Small Brands Kind Eye works with smaller brands, including Made Organics, Choiselle, John Masters Organics, Thesis, Deep Steep,

Andolu Naturals, Coola and Hopscotch Kids. Some, like Badger, are in retailers such as Whole Foods or, like Fig + Yarrow, Target. But many others are just starting out and trying to get noticed. The Kind Eye platform puts these brands in front of retailers and, by providing product features, brand values and wholesale information on the site, presumably makes the matching process easier. This can save fledgling brands on unnecessary sampling and allows them to focus more on qualified and truly motivated buyers.

What the Consumer Wants In order to serve brands and retailers, Kind Eye keeps close tabs on consumer attitudes and behaviors. The portal allows consumers to shop directly from the site, browse ethical beauty care retailers and provides a blog that offers insights into subjects such as ethical beauty definitions, the concept of the precautionary principle and nonprofit organizations. Murray noted that Kind Eye’s recent research showed that ethical beauty care consumers place transparency at the top of their list of desirable product/brand attributes. These shoppers want to trust a brand, feel a connection to it and know the people who stand behind its promises. At the same time, consumers are, as always, concerned about ingredients. Murray noted that shoppers still tend to gravitate to free-from statements, which serve as a trigger of quality. They also want as much information about the product’s contents to be provided on the label in an easy-to-digest manner. The ethical beauty care space is rapidly changing, Murray noted, and sensitivity around ingredient issues will continue, as will a lack of simple black-and-white answers, creating consumer confusion. She said that in her role as an educator she emphasized positivity and never approaches topics with fear. Instead, she encourages consumers to make responsible choices that they can feel good about.

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Retailers are constantly bombarded by brands, creating an inefficient and expensive sorting process, said Rachel Murray, cofounder and CEO, Kind Eye, Inc. www.GCImagazine.com

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DISCOVERIES & BREAKTHROUGHS

Inside AmorePacific’s next phase of global Korean beauty growth. | BY LISA DOYLE

AmorePacific’s iconic cushion compact has been synonymous with K-beauty, inspiring countless imitators around the globe and helping fuel a global craze for all things Korean in the beauty space.

∑ A growing middle class in Asia and the rise of millennials in the United States are impacting AmorePacific’s growth strategy. ∑ While AmorePacific will continue to deliver Asian beauty based on Asian philosophy, each market and brand requires a different distribution strategy, from partnerships with existing retailers to freestanding brand stores. ∑ AmorePacific will continue to lead the K-wave, with a goal of achieving $12 billion in sales by 2020.

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think K-beauty—and how it’s being defined right now— will fade away,” Alicia Yoon, founder of K-beauty mecca Peach & Lily, recently explained to Global Cosmetic Industry*. “However, the conversation around K-beauty will evolve and focus on the brands that truly wow, and these brands will have staying power, like the beloved brands Stateside (and beyond).” Certainly, no brand has better defined the origins and ongoing evolution of the K-beauty boom than South Korea’s AmorePacific. The company’s iconic cushion compact has been synonymous with K-beauty, inspiring countless imitators around the globe and helping fuel a global craze for all things Korean in the beauty space. The company’s annual sales totaled nearly $4.7 billion in 2015, with strong growth ahead. Aside from its flagship brand, AmorePacific is home *“K-beauty Won’t Last Forever”; www.gcimagazine. com/marketstrends/regions/asiapacific/ facebook.com/gcimagazine

“K-beauty is not a trend that will come and go, and we’re going to ride the K-wave,” said Karen Housman, vice president of marketing—U.S., AmorePacific.

to high-profile brands such as Etude House, Lolita Lempicka, Sulwhasoo, Annick Goutal, Laneige and Innisfree. AmorePacific has continued to expand its reach, establishing a unit in Malaysia, boosting the omnichannel with a partnership with eBay Korea and launching a customizable lipstick. Recently, Karen Housman, vice president of marketing—U.S., AmorePacific, spoke with correspondent Lisa Doyle about the Korean powerhouse’s global coup. –Editor in Chief Global Cosmetic Industry (GCI)

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ON THE ROAD WITH LANEIGE AmorePacific’s Laneige brand kicked off its 11-city Beauty Road world tour in April this year, and traveled outside of Asia for the first time in August, debuting in North America at Toronto’s Easton Centre. The Beauty Road’s interactive booth delighted and engaged visitors throughout the three-dayevent, offering customized skin care consultations with Laneige’s hydration level detecting device, the brand’s Water Bank skin care line, interactive games with prizes and a custom photo booth for sharing snapshots on social media channels using the official hashtag, #BeautyRoad_CA. Strategically stationed just below the mall’s Sephora store, which sells a wide array of Laneige products, the booth attracted nearly 2,700 visitors and led to more than 100,000 digital impressions on Laneige’s Canada Facebook and Instagram channels. Keep an eye on next year’s Beauty Road, which is sure to expand its North American reach.

Laneige’s Water Bank skin care line was featured as part of the brand’s Beauty Road world tour.

The interactive event featured skin care consultations and Laneige’s hydration level detecting device.

The Beauty Road tour featured interactive games with prizes and a custom photo booth for sharing snapshots on social media channels using the official hashtag, #BeautyRoad_CA.

Lisa Doyle: What’s involved in your role at AmorePacific? Karen Housman: I lead marketing strategy for brands in the United States—I develop and execute online marketing and expand distribution channels, and for future growth, I work very carefully with media, PR and digital strategy. What’s exciting is, you know the growth of the brand in Korea, and my goal is to drive it in North America. So, I work very closely with architects and visual merchandisers. My goal is to drive brand awareness and elevate the brand. I joined at end of last year. It’s an exciting new job for me. It’s rare to find a big corporation based in Asia coming to the United States—it’s usually the reverse. LD: What’s driving the recent rapid growth of AmorePacific in Asia and North America? KH: Right now, we’ve moved [up] to the 12th largest beauty company in the world. Sales have gone up 20% year on year overall, and it’s especially growing outside of Korea—we’re focused on international expansion and globalization. In the United States, it’s taken a long-term commitment— success is not achieved overnight. Our focus is on R&D and spending time to learn the market. The other big component is the trends—the rise of the middle class in Asia, more investment in beauty in China and the changing beauty retail environment. As far as the United States [is concerned], our focus is on digital and the rise of the millennials— and our strategy is aligned with how AmorePacific as a company is growing. LD: How does your consumer base and marketing strategy in the United States vary from Asia? KH: The most important thing in both markets is that the philosophy remains the same—Asian beauty based on Asian philosophy. AmorePacific wants you to have great, healthy skin, and that has to be taken care of from the inside and out. One thing we focus on is how to take care of skin and make skin care more modern, fun and innovative. That’s a fundamental strategy for both [markets]. In the United States, awareness [of AmorePacific] is much lower, so the focus here is to educate consumers and build awareness. One strategy is to disrupt the

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starting to be known and seen around the world—it’s exciting. LD: What’s next for AmorePacific worldwide?

marketplace through innovation and offer innovative experiences to consumers. Even in a mature market like North America, people are looking for something new. In August, we went to Toronto with the Laneige Beauty Road Show (see sidebar, “On the Road with Laneige”). It’s a huge event experience—this year, we’ve been to 11 cities, including three cities in China, Malaysia, Taiwan and Southeast Asia, to offer 360-degree consumer experiences. This year marked the first time we brought the show to North America. LD: What are the plans for additional retail expansion in North America over the next few years? LH: It’s important to note that AmorePacific has more than 30 brands in Korea, and it’s very exciting to see the product pipeline. There are five global brands: Laneige, Sulwhasoo, Innisfree, Mamonde and Etude. We have two brands in the United States, plus the flagship AmorePacific brand. Yes, there will be distribution strategies in the future to grow, but we’ll also be bringing additional brands to the United States and seeing which distribution channel makes sense for each brand. We are also found in Sephora in Canada and the United States. We’re planning to renew our website and are developing our Aritaum Shops in Korea and the United States. They are our own freestanding shops that bring our brands to the United States, and are found in areas with a focus on Asian shoppers and consumers. We have 10 conversions planned this year from the preexisting Amore Shops—so that is another area we plan to focus on. Aritaum Shops will have a more modern design and are aligned with the design concept current with our brand. And, of course, we’ll be further developing our own website and ecommerce capability.

LH: This is exciting to talk about. The K-beauty trend definitely has helped with increasing awareness, as people are very curious about what it is. The way we can take advantage of it is through repurchase, as our brands have an over 50% repurchase rate. K-beauty is not a trend that will come and go, and we’re going to ride the K-wave. It’s a great way for consumers to discover products, and they believe in it after they’ve experienced the innovation. AmorePacific has a global reach, and we’ve been the number one brand in the Korean beauty market since the K-wave started. Our innovative solutions are driving the beauty market, and we’re just

LH: The goal for 2020 is to be $12 billion in sales ... Our other goal is to have 50% of our sales come from outside Korea, which means the United States will be a very important market for growth. We want to share our vision of beauty and innovative products for consumers. The most innovative product we have is the bestselling Cushion Compact, and there’s much more to come. The company is definitely focused on continually providing innovation, so that will drive global growth worldwide.

LISA DOYLE was formerly the associate editor of Global Cosmetic Industry and is a freelance writer in the Chicago area. Her work has also appeared in Skin Inc., Salon Today, Modern Salon and Writer’s Digest.

LD: How have all things “K” had an impact on the AmorePacific brand? www.GCImagazine.com

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“

BRAND STRATEGIES

HOW TO BE

A DAVID

What it takes to become a successful

challenger brand in any beauty category. ∑ Challenger brands upend their categories with ambitions that outstrip their often modest resources. ∑ Challengers can’t compete with the big fish on their own terms, so they introduce something new—a different approach to positioning, product, packaging, distribution or communication—thereby changing the rules of the game.

| BY LAURA ZIV

∑ To become a challenger, a brand must see its category with fresh eyes and proceed with a rigorous focus and obsession with detail.

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he term “challenger” was first coined by Adam Morgan, author of “Eating the Big Fish: How Challenger Brands Can Compete against Brand Leaders,”* to describe brands that upend assumptions in a given category or industry. Today, beauty is in the age of the challenger brand—companies that disrupt the dynamics of segments, or even entire industries, and unseat the market leader.

David Vs. Goliath Every category has a Goliath, a leader or dominant brand with the biggest market share that establishes the segment’s rules and conventions. Challengers play the David to their category’s Goliath. But being a small brand, or the number two or three player in a category, doesn’t automatically make a company a challenger. What defines the challenger is a mindset. Challengers define what they are challenging, so that they can introduce new criteria of choice. They also typically have big ambitions that outstrip their resources. As a result, they must think smarter and be more agile in order to challenge the category’s behemoth. Challengers can’t compete with the big fish on their own terms, so they introduce something new—a different approach to positioning, product, packaging, distribution or communication—thereby changing the rules of the game.

Don’t Fear Disruption Every industry is subject to disruption by challengers, including hospitality (Airbnb), livery (Uber), education (Coursera), financing (Kickstarter) and retail (Etsy). Larger CPG brands, in particular, are prone to challenger disruption as a result of consumers’ changing expectations (where agility is in inverse proportion to size) and fragmentation of channels that reduces barriers to entry for emerging brands. *Wiley (2009) www.GCImagazine.com

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Beautycounter distinguishes itself with its rigorous ingredient selection process and explicit “Never List” of more than 1,500 ingredients that it bans from its products.

Disruption of a category needn’t be seen as a negative thing, said Mia Davis, head of environment, health and safety for Beautycounter, a California-based beauty and personal care company with an uncompromising focus on ingredient safety and transparency. Indeed,

Disruption of a category needn’t be seen as a negative thing. Beautycounter, which sells its products online, as well as via beauty consultants, sees itself as disrupting the entire beauty industry, with its rigorous ingredient selection process and explicit “Never List” (see photo) of more than 1,500 ingredients that it bans from its products. “What we are doing is shaking things up, but it is also innovative and collaborative,” said Davis. “We want to share pre-competitive information about ingredients, and work together to improve

access to data and … ingredient sourcing. Certainly Beautycounter benefits from that, but so does any other company that wants to improve and set the bar higher.”

What It Takes to Be a Challenger Challengers live by several core principals. Here are just a few examples of how today’s beauty and personal care brands are challenging the Goliaths of their category.

1. Intelligent Naiveté Challenger brands find real opportunities for growth by viewing a category with fresh, or “innocent,” eyes. They ask simple, but intelligent questions that brands within the category may lack perspective to do. This “intelligent naiveté” is often a real advantage to a challenger brand, Morgan wrote in “Eat Big Fish,” because it takes big ambitions to change the way the world feels about a given industry. When Craig Dubitsky, founder and CEO of Hello Products—the world’s first “naturally friendly” oral care brand—first surveyed the category, he was surprised by what he saw. “The visual vocabulary was shocking to me,” he explained. “An extracted tooth is Discoveries & Breakthroughs

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BRAND STRATEGIES

the global icon for oral health. That’s the last thing I want to see on my toothpaste. Everything was fear- and shame-based— kill or be killed! If you’re not whitening, you’re fighting germs. There was nothing fun, friendly, delicious and interesting.” Dubitsky saw an opportunity to bring a friendly, human touch to the combative narrative of oral care. “I wanted to elevate the everyday, turn a commodity into a desirable,” he said. Hello Products achieved this transformation through vibrant packaging, appealing flavor combinations (including Mojito Mint and Blue Raspberry) and an eminently likable brand tone. Olly, a vitamin and supplement brand, jumped from the health aisle into other areas, according to CEO and co-founder Brad Harrington. The brand also focused on the consumer experience of taking supplements. “Instead of choking pills down, we were inspired by the gummy form,” Harrington explained. “We wanted to create a product that people would look forward to taking every day.” In addition, Harrington and his team saw the vitamin category as being divided into two uninspiring factions: scientificsounding brands such as Centrum and folksy brands such as Nature’s Garden.

Craig Dubitsky, founder and CEO of Hello Products, saw an opportunity to bring a friendly, human touch to the combative narrative of oral care.

Harrington explained, “We wanted [instead] to bring a more lifestyle approach that would appeal to millennials, who gravitate toward health, wellness and alternative medicine.”

2. Lighthouse Identity Challenger brands are rigorous in identifying who they are and what they stand for and develop a very focused “lighthouse identity” based on an “inarguable brand truth.” Challengers project this identity intensely and consistently.

“Brands to me are like people,” said Harrington. “The most interesting ones have an energy and aura around them. Olly created this aura, or identity, via a colorful brand block in a sea of confusion. Vitamin brands are categorized alphabetically at shelf, but Olly is merchandised like a system, all together. We color-coded the benefits and made them simple and clear, with variants such as Sleep, Beauty, Skin, Immunity and Energy.” Beautycounter’s Davis noted that, by prominently citing its “Never List” of ingredients, the company had created a new space in the beauty industry that was more specific than “green” or “natural.” She explained, “It is always a challenge to define a brand both by what you are—better beauty—and what you are not—protective, secretive. We show why we’re different and lead by example. We’re not perfect—this is about progress, not perfection—but we’re proud of our hard work and success to date.”

3. Sacrifice

Olly upended the vitamin category by color-coding benefits, creating easy-tounderstand variants and offering a fun chewable format.

Brands with fewer resources need to know what they are not going to do, which can be as critically important as what they are going to do. It is not a question of prioritization, but rather eliminating niceto-have, as opposed to must-have, targets. Indeed, this concentrated focus can be seen as one of the few advantages that challenger brands have in their arsenal, compared to market leaders. “With Olly, we stayed super-focused by doing an exclusive deal with Target,” said Harrington. “Our focus was, ‘How do we win at Target?’”

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“I wanted to elevate the everyday, turn a commodity into a desirable.” —Craig Dubitsky, founder and CEO of Hello Products

www.GCImagazine.com

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This meant sacrificing how quickly the brand grew in the first year, including international expansion, in order to stay focused on product, product delivery and merchandising.

4. Unlimited Obsession The flip side of sacrifice is overcommitting, driving success through a relentless drive to succeed in one or two key activities. “We are fanatical about the experience of our product,” said Harrington. “We are constantly trying to delight consumers with regard to taste, flavor and organoleptics (qualities that stimulate the sense organs).” Hello Products describes itself as being an intense listener. “We really care about being approachable and hyper-thoughtful,” said Dubitsky. “We pay extreme attention to the way we interact with people.”

Dubitsky makes himself easily accessible by Skype to anyone who contacts him, including dentists, dental hygienists, entrepreneurs, people living in China looking for Hello Products and even dads helping their kids on their school projects. He added, “The positivity that we put out in the world comes back to us in ways we couldn’t even factor.” In short, brands can never obsess too much over their area of expertise. Davis laughed, “You can’t overcommit to the marriage of beauty and health.”

LAURA ZIV is a creative brand strategist specializing in beauty, fragrance and personal care. Her work spans trend analysis, innovation, ideation and concept development for brands. Ziv has a Master of Arts from Oxford University, and previously worked as a magazine writer and editor for international magazines based in New York. SUBSCRIBE TO OUR NEWSLETTER Sign up to receive daily news, insights and trends

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How can brands innovate when the old rules no longer apply? | BY LISA DOYLE

∑ It can no longer be assumed that “shampoo first, conditioner second” is a given, due to two rapidly growing trends: reverse washing and co-washing. ∑ It’s not enough for hair care products to clean and condition the coif—they need to deliver added value, and specialty ingredients can ensure that a brand can offer consumers that je ne sais quoi. ∑ Brands can win when natural benefits come from the powerhouse ingredients intrinsic to the functionality of a shampoo or conditioner.

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hen it comes to hair care, “lather, rinse, repeat” doesn’t cut it anymore, and it hasn’t for quite some time. Consumers want true solutions to their hair dilemmas, and they want them in the form of eco-friendly ingredients, proven results and a spa-like experience upon delivery. That’s not too much to ask of a brand, right?

Switching up the Steps It can no longer be assumed that “shampoo first, conditioner second” is a given, due to two rapidly growing trends: reverse washing and co-washing. Reverse washing inverts the traditional hair care process, beginning with conditioning, followed by shampoo. The category saw a significant boost from the launch of the TRESemmé Beauty-Full Volume range. Co-washing, meanwhile, is conditioner-only washing, skipping shampoo entirely. The trend has led to huge growth in clarifying conditioners, which accounted for less than 1% of conditioner sales as of 2014. Key launches in the co-washing segment include Ouidad’s Curl Co-Wash, IGK Smoke & Mirrors Conditioning Cleansing Oil, Madam C.J. Walker Beauty Culture’s Jamaican Black Castor & Murumuru Oils Ultra-Moisturizing Co-Wash, DevaCurl No-Poo and the Unwash brand, which recently debuted its facebook.com/gcimagazine

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Bio-Cleansing Conditioner, Anti-Residue Cleanse, Hydrating Masque and Dry Cleanser at Ulta. At the time of the Unwash launch, the retailer noted, “With the launch at Ulta Beauty, Unwash is able to expand on their loyal following and provide easy access to the comprehensive co-washing collection, meeting the growing demand for this mainstream trending hair care category.” Both of these trends point to one key effect—the rising importance of conditioners. Indeed, according to Euromonitor International*, conditioner sales grew by 5% in 2015 in the U.S., reaching sales of $2.4 billion. Yet, even if they skip the shampoo, consumers still want to feel that their hair is just as clean—and that’s where improved ingredients come into play. “In co-wash hair cleansing formulations, the Endicare FB series can add richness to improve the low volume foam,” said Shannon Smith Butz, Coast Southwest’s technical director, surfactants. “Although we know ‘bubbles’ are not necessary to cleanse, consumers still associate bubbles with how well a cleanser works. By providing a rich foam in co-washing and even reverse washing products with less surfactant, we are able to meet the consumers’ expectations while providing mild cleansing.” *www.euromonitor.com

Consumers also expect that the cowashing and reverse washing will provide the same level of hair repair as before, or better. Earth Supplied Products offers Vegabead technology, created by Tycho Speaker, president of Capsulent. “Patented Vegabead polyelectrolyte microcapsules actively target and selectively heal hair damage by resealing split-ends and smoothing lifted cuticles,” explained Speaker. “Unlike synthetic polymers, which coat the entire hair like shellac, Vegabeads deposit only where they are needed. Healthy hair surfaces are left untouched and remain build-up free while damaged sites are repaired. Vegabead products are ideal for reverse-washing, and co-washing. For several years, our test panel consumers have reported that our spray formulations were ideal for pre-poo treatments and frequently eliminated the need for any post-shampoo conditioning.”

That Extra Something

At the time of its Unwash launch, Ulta Beauty noted, “With the launch at Ulta Beauty, Unwash is able to expand on their loyal following and provide easy access to the comprehensive co-washing collection, meeting the growing demand for this mainstream trending hair care category.” www.GCImagazine.com

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It’s not enough for hair care products to clean and condition the coif. They need to deliver added value, and specialty ingredients can ensure that a brand can offer consumers that je ne sais quoi. Biosil Technologies has responded to the emerging scalp therapy trend by providing hair care that delivers skin care as well via its PAE Complex line.

“The complexes contain phytic acid, aloe and a skin care active,” said Philip Chung, vice president of sales, Biosil Technologies. “The idea is that the phytic acid exfoliates and better prepares the skin for both improved acceptance and delivery of skin care actives; PAE Complex Oil Control targets sebum reduction [in the scalp].” And, while your customer base needs products that can heal internal hair damage, they equally need to protect hair from damage brought on by heat, color treatments and environmental damage. “Color protection shampoos [that do not use] sulfated surfactants, yet deliver outstanding color protection and care performance, contain unique conditioning polymer technologies like Merquat 2003PR,” said Malte Ruffing, Lubrizol’s global marketing manager, hair care. “Thermal protection solutions with Merquat polymers, without the use of silicones, are shielding the hair from heat and provide great care performance.” Indeed, offering consumers a solution they can’t find elsewhere will increase loyalty to your brand—especially if it really can deliver proven, long-lasting results. “We see a lot of emphasis on hair health—not just cosmetic, temporary approaches to cover damage,” said Speaker. “Consumers want real solutions that actually heal damage and keep it that way.” Hair Care Focus 31

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STRIKING OIL Boosted by the ever-increasing demand for organic beauty, the worldwide jojoba oil market is expected to reach $254.2 million by 2024, according to a new report by Grand View Research, Inc.* While cosmetics are expected to be the leading category to incorporate jojoba oils, hair care is not far behind due to the oil’s natural anti-aging, dandruff protection and shine-enhancing properties. *www.grandviewresearch.com

VIRTUAL COLOR EXPERIMENTATION In August, YouCam Makeup, the virtual try-on beauty app, joined forces with Paul Mitchell, which was the ﬁrst hair care brand to allow YouCam users to sample hair color risk-free. Users simply upload a selﬁe or utilize the live camera on their phone and select a color from the complete range of Paul Mitchell Professional Hair Color shades to help decide which are worth trying in real life. The app also includes a consultation icon, linking users directly to Paul Mitchell’s Salon Locator, where users can make a color appointment.

Plant-derived Promises It’s almost a given that any high-quality beauty good will be able to boast organic, responsibly sourced and/or plant-derived ingredients—and preferably, all of the above. When this can come from the powerhouse ingredients intrinsic to the functionality of the shampoo or conditioner, it’s even better. This year, Ajinomoto North America launched its Amisoft ECS-22W, a mild, amino acid-derived, sulfate- and petroleum-free anionic surfactant. “It has excellent foaming properties even in the presence of oils,” said Divya Namjoshi, the technical and marketing specialist for Ajinomoto’s specialty and personal care group. “It is a multifunctional ingredient—it is a mild surfactant, and at the same time, it has excellent skin and hair conditioning properties. It is also an Ecocert-certified natural ingredient.” 32

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According to Lisa Jones, regional vice president, general manager, Coast Southwest, “We are expanding our patentpending aqueous foam boosting series of ingredients, all based on vegetable carbohydrates, and produced through the hydrolysis of corn starch. These materials allow formulators to reduce the amount of harsh surfactants in a formula while improving the structure and lubricity of the foam.”

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Experience it at IFSCC in Orlando, booth #202

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REASONS

Multicultural Consumers are Driving Hair Care From natural locks to hair repair, consumers of all ethnicities are inspiring new innovations.

| ∑ African Americans and Hispanics are critical to the hair care segment both because of their vast populations and their relatively high use of beauty care products. ∑ As hair care focuses increasingly on multicultural consumers, it must offer new solutions for hair protection and repair, as well as natural curls. ∑ Because of the great variation in hair types and needs, product developers and marketers must test products across a range of groups to ensure efficacy.

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orth America has been a melting pot of cultures and ethnicities for centuries, but it wasn’t until now that the continent’s diverse minority groups became prominent drivers of trends in the personal care industry. The strong influence minority groups have on the industry is expected to keep growing for several reasons.

1. Growing Populations The United States is forecasted to become a majority-minority nation with the next 30 years, according to the U.S. Census Bureau (www.census.gov). As of 2014 census numbers, African Americans facebook.com/gcimagazine

are the second-largest minority group in the United States, making up a bit less than 15% of the population. The largest ethnic minority is Hispanics, which make up 17% of the population, with forecasts predicting that share to grow to 28% by 2050a.

2. Increasing Product Use African Americans may make up a relatively small slice of the current U.S. population, but that hasn’t stopped them from becoming a heavy influencer of cosmetic trends. Think about all the attention that color cosmetics for darker a Sources: Census.gov Facts for Features: CB15-FF.18 Sep 2015

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| BY JENNIFER DONAHUE, Croda International skin tones and hair care products that address multicultural needs have been getting—they’re popping up on store shelves more quickly now than ever beforeb. According to Kline research, Hispanics are the most brandconscious ethnic group, in part because they’re rooted in a culture with a strong focus on beautyc. U.S.-born Hispanics outspend both foreign-born Hispanics and non-Hispanicsd on personal care products. As a result, multicultural personal care products are projected to grow at a higher rate than the general industry. Consider, for instance, Pantene’s partnership with R&B/soul singer Jillian Hervey for its #StrongIsBeautiful campaign, which offered insights into strengthening curls and fighting frizz, Sephora’s “It’s a Curl Thing” textured hair care online portal or, most recently, MAC’s partnership with Empire actress Taraji P. Henson on a line of products including mascara and lipstick, highlighter and bronzer, and liquid eyeliner. –Editor c See Aleena Astorga Roeschley’s “What’s Influencing Latinas in the Beauty Aisle?”; www.gcimagazine.com/marketstrends/consumers/women/ d Nielsen Newswire “Hispanic Consumers are the ‘Foundation’ For Beauty Category Sales” Feb 2015 b

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3. Natural Resurgence Mintel reports that 50% of black consumers agree that their hair is an important part of their identitye. That’s one reason why many smaller brands are doing very well in the marketplace—they’re focusing on connecting with consumers Mintel GNPD, August 2016; www.mintel.com

on a cultural level and addressing their customers’ specific hair concerns. These brands’ success is also due to the fact that the natural hair look is trending for both African Americans and Hispanics. After the craze of the keratin-straightening system, the current natural trend, which is stronger than ever among minority groups, is all about

liberating hair’s natural curls. As a result, many consumers are transitioning from a relaxed to a natural look, which drives sales of products designed for curly hair and products that repair dry and damaged hair. Maintaining curls requires additional styling products and conditioners. Leave-in conditioners are an extremely important application to consumers in Latin America and especially in Brazil, where they’re referred to locally as combing creams, and make up 38% of all conditioners, according to Mintel. Combing creams are applied to wet hair before styling and offer a variety of benefits including detangling, moisturization, shine enhancement, antifrizz and enhanced curl definition. Used in addition to a leave-in conditioner, a combing cream can be reapplied throughout the day to refresh curls. Combing creams aren’t just a Brazilian trend—they’re also coming to the United States to meet the needs of Hispanic consumers who are embracing the natural hair look.

4. Strength and Repair We also see an increase in the use of styling products that allow for hairstyle variations, as well as general conditioning, strengthening and moisturization for hair that is typically dry and prone to breakage. To support this need, 26% of global hair care products launched in 2010 through the first half of 2016 used claims for damaged hairf. Moreover, use of claims for damaged hair globally rank in the top five hair claims for products launched in 2016. As a result, formulators and brands require excellent, proven conditioning solutions for damaged hair. Ideally, these solutions have been tested on a broad range of hair types, including colortreated hair, and are globally compliant, high-performance, cost-effective and customizable to support brand positioning with additional actives like proteins, botanicals or oils that cater to customer needs and drive purchasing behavior.

The Innovator’s Role The marketplace for ethnic hair care is certainly a place every savvy innovator The natural hair look is trending for both African Americans and Hispanics and is all about liberating hair’s natural curls.

Mintel GNPD, August 2016; www.mintel.com

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According to Mintel, 26% of global hair care products launched in 2010 through the first half of 2016 used claims for damaged hair; pictured is TRESemmé’s Thermal Creations Instant Heat Tamer Spray, which protects hair from heat damage associated with ceramic irons, blow-dryers and other styling appliances.

wants to be, but formulating for a wide range of ethnicities can be a real challenge for brands. Unique ethnic groups have specific hair characteristics and morphology. The shape of the hair cuticle can be round, oval or flat, and can span a large size distribution even on the same head. Hair types vary in level of oiliness and overall style from curly to wavy to straight, and in some cases can be a mixture of each. These variations result in distinct hair needs and can cause performance variations in ingredients used in hair care products. For these reasons, it is important to test products on different ethnic hair types to show efficacy. To address the hair care needs of the multicultural consumer, formulators are building formulations with versatile products that stand up to testing, meet global regulations and cater to the unique needs of these growing populations. It’s important to keep in mind that hair

from different ethnicities has distinct conditioning needs, based on the differences observed in morphological characteristics—this is especially true when hair has been damaged from thermal styling tools, chemical processes or hair coloring.

Staying Relevant To continue to gain traction and remain relevant in a changing cultural landscape, formulators are catering to the needs of the growing multicultural population. Using versatile hair care products that work for a broader range of ethnicities and focusing on repairing damaged hair is a must in the current marketplace.

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Despite tepid growth projections for the category overall, opportunities exist for brands to innovate and achieve growth.

| BY HANNAH SYMONS, Associate Beauty and Personal Care Analyst, Euromonitor International

∑ Consumers are beginning to see their hair care as an extension of overall wellness, which advantages natural offerings and expanded care routines. ∑ Opportunities also exist to service Western and Eastern men who are setting new grooming standards in their cultures. ∑ While customization is hot in other beauty care categories, true personalization can be a challenge in hair care, especially within the mass space.

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lobally, hair care has been on a trajectory of moderate growth in recent years. Last year saw a slight slowdown, recording year-on-year value growth of 2.9%, and, with a projected CAGR of 1.9% in constant terms over the 2015–2020 period, things looks set to continue in the same steady vein. While the category might not be enjoying the dynamism of other parts of the industry, hair care still has ample opportunities to branch out.

care, and products that assert health benefits, a natural composition or take preventative measures are becoming a priority. Globally, Shea Moisture was the fastestgrowing hair brand last year, with the products utilizing natural ingredients, chiefly plant and food extracts, to target specific hair concerns. Likewise, OGX’s model of pure and simple formulations

Hair Care as Wellness Observing that dermocosmetic brands have been gaining popularity, hair care brands are also heightening their remedial claims as consumers take a more holistic approach to their wellbeing, viewing hair as an extension of the skin. Basic cleansing and scent properties are now expected rather than desired in hair facebook.com/gcimagazine

Globally, Shea Moisture was the fastest-growing hair brand last year, with the products utilizing natural ingredients, chieﬂy plant and food extracts, to target speciﬁc hair concerns.

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placed it amongst the top five fastest-growth brands (F-1) and saw it garner international attention, eventually being acquired by Johnson & Johnson earlier this year. This appetite for natural formulations in hair care is encouraging, in anticipation of the predicted growth in fermented beauty ingredients. Likewise, the market is awash with innovative offerings that no longer just remedy post-damage but also act to prevent future ill hair health, adding an extra step to the daily routine. Schwarzkopf ’s Extra Care Purify & Protect anti-pollutant range creates a thin film to protect hair against contaminating agents, while its Essence Ultime Omega Repair Beauty Balm is essentially an anti-ageing BB cream that fights seven signs of hair ageing.

Expanded Hair Care Routines Inspired by Asian practices, which incorporate a multitude of formats and textures, there remains scope for greater sophistication in hair maintenance to become normalized in the West, for example scalp scalers, essences, serums, rinses, tonics, foams and masks. Adapting targeted skin care regimen sets and systems to work for the hair, like those by Murad and Skinceuticals, could provide the ideal encouragement for consumers to adopt an extended hair care routine.

Men’s Category Outgrows All Men’s hair care is forecast to grow at a constant value CAGR of 3.6% in the 2015-2020 period, ahead of the overall growth prospects for hair care. In the West, a progressive culture is playing into this trend, as the stigma of male grooming is being lost and men no longer have to subscribe to a cleanly shaven ideal to be considered smart in the workplace. This movement is giving men a renewed confidence to experiment and, increasingly, many men simply have more hair to maintain. In the United Kingdom this year, Estée Lauder Companies announced it will be investing in men’s reignited interest in hair care by opening Aveda barber shops in London. www.GCImagazine.com

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In the West, a progressive culture is playing into the male grooming trend; the stigma of male grooming is being lost and men no longer have to subscribe to a cleanly shaven ideal to be considered smart in the workplace.

In emerging markets, meanwhile, growth is fueled by economic and political change. The prospects are encouraging, particularly for the Middle East and Africa, which is projected to be the most dynamic market for men’s hair care over the next five years. In Saudi Arabia, for example, the category saw strong 24% current value growth last year, albeit from a small base. The category has reaped the rewards of the “Saudization” of the workforce, a government drive to reduce reliance on expatriates, which has sent local men into white collar jobs in droves, with a newfound need to groom.

Consumer Calls the Shots All across the industry, brands have looked to personalization in a bid to engage a consumer group that is becoming increasingly unresponsive to mass marketing, although this concept remains niche and largely inaccessible within hair care. There have been various attempts to explore personalization, such as System Professional from Wella, which maps the energy profile of hair to generate a personal code from more than 174 million combinations. This is a step in the right direction, but the service has limited reach, owing, in part, to its premium positioning.

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Given the similar demands and concerns of consumers for hair as for skin, there exists great potential for hair care to prove itself an exciting space to play in.

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The demand for bespoke products and services is driven by a younger consumer, yet their income bracket is being overlooked. Problems arise in scaling a personalized model to the mass market, primarily because widespread adoption inevitably dilutes the degree of uniqueness. The limitations of mass personalization can be seen in customizable hair brand The ShampYou range, launched in Ulta in spring of this year, ShampYou, launched in Ulta comprises four shampoos and eight targeted “serum shots,” in spring of this year. The mass which points to the limitations of genuine personalization in move comes at the expense of hair care. the core of the personalized model. Carrying only four shampoos and industry in terms of both innovation and eight targeted “serum shots” in the range, its responsiveness to evolving lifestyles. the extent to which these products can claim However, given the similar demands and to be genuinely personalized is questionable, concerns of consumers for hair as for although the opportunities remain. skin, there exists great potential for hair Seemingly, hair care lags a little behind care to prove itself an exciting space to some more progressive areas of the play in.

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BRAND STRATEGIES

THINK DESIGNER LIKE A DESIGNER DESIGNER

Applying design thinking can ensure that brands remain cohesive, from packaging line organization to retail.

| BY SHERI L. KOETTING, MSLK

“D ∑ Design thinking can be applied to all of a brand’s business objectives, from packaging to formulation to line organization and beyond. ∑ This requires creative teams to be closely aligned with R&D, product development and other critical groups. ∑ Successful application of this thinking can achieve brand cohesion and consumer delignt.

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Brand Strategies

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ecoration” has been a longstanding industry term for the visual aspect of packaging. Unfortunately, this arcane term represents everything wrong with the old way of thinking—that design is merely a façade to “gussy things up.” If a brand views design merely as the exterior of its packaging, they’re missing out. Design goes deeper, and is integral in helping brands achieve business objectives. Design can inform product organization, retail appearance, and even the product itself.

Telling an Ingredient Story Design thinking was recently put to use when our research team discovered that the point of difference for a new brand was its key ingredient story. This facebook.com/gcimagazine

ingredient, a superfood, was poised to be the next hot thing in its category, and a main differentiator from competitors. The research clearly indicated the advantages of a single ingredient story to retailers, consumers, and public relations. However, the client didn’t realize the value of this ingredient, and had even planned a line extension without this component. Once seen in this light, the brand agreed to feature this material as the backbone of its story. Upcoming launches would be formulated to ensure that all products would contain this superfood. Meanwhile, our creative team reworked the product name and logo to reference the key ingredient story. The result is a stronger, consistent brand story that resonates with consumers at every touch point, creating an overall designed experience. Global Cosmetic Industry (GCI)

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Brand Architecture Matters Many times, fledgling brands have a great idea for one, two or even three main products comprising their entire line. However, experience shows us that retail buyers want more breadth and options from the brands they carry. Brand architecture and planning,* which employs design thinking, can help you anticipate how products will be added and presented in the future. A brand’s breadth of offerings should be well thought-out—in other words, designed. As a design firm we are often asked to help brands consider how to best position and present their products from the retail standpoint of overall category, department and merchandising. During a recent branding audit for a prominent skin care brand, we helped uncover the reason why, at retail, their body wash had not been performing as well as their other skin care offerings.

a matter of bringing in a new ingredient, or differentiating the offering based on concentration levels. Whatever the case, you must think like a designer and take a hard look at where new products fall into the larger picture of your offerings. This may even mean creating sets and POP displays that position a new product into a new category.

It’s About the Consumer, Not You Great design from a consumer’s perspective should translate to a lucid, seamless experience. Ultimately, it should bring joy. To do so, brands must remain flexible and anticipate their audience’s needs. When a brand finds success with one hero product, there must always be a complimentary product, or “next step” product, to anticipate a consumer’s reaction of, “I love it! What is next?”

Too often there is a disconnect between the brand’s promise and the reality of the user experience. While this SKU was well-represented online, it was only upon our store visits that the problem became clear. This single SKU was separated from the other products in their line. As a result, it was trying to compete against robust offerings from other brands. The consumer perception was that the brand was a dabbler, rather than a leader in that category. The lesson was that more body wash SKUs were needed to increase the presence at retail. When it comes to the number of products a brand should offer, there is no pat answer. As a guide, too few SKUs means there are not enough choices, whereas too many SKUs can overwhelm. Sometimes it’s only a matter of reformulating the scent. Other times it’s *Read “4 Ways to Organize Your Brand around the User Experience” at www.gcimagazine.com/ business/marketing www.GCImagazine.com

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Occasionally, you might need to shift formulations or product assortment to make regimens clearer. This subtle shift in mindset is part of a mantra we help instill in all our clients: “It’s never about you, it’s always about them.” The overall design of a line’s brand architecture has everything to do with the way you intend the user to shop the line. A few of the more common ways are: by key ingredient, by step in the regimen, by skin or hair type, by efficacy level (basic vs. pro) or by user benefit. Wise brands choose one main approach and stick with it throughout their entire line, as opposed to reinventing a new system each time, which only leads to consumer confusion.

Packaging and Product Experience For beauty brands, packaging must convey the entire product experience Brand Strategies 45

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BRAND STRATEGIES

from the outside in. If your formulation is designed to be the most efficacious on the market, your packaging must use all the tools available to convey this: color, images, materials, words, etc. Even the selection of the packaging components can add to the user’s experience of how well-designed the product is overall. If you are trying to convey a sense of convenience, the packaging components should be easy to use. Too often there is a disconnect between the brand’s promise and the reality of the user experience. It is almost as if the people making the product have never spoken to the people designing the package. Formulation, brand architecture (i.e., the line’s overall organization), and packaging must work together to deliver on the brand promise. Sometimes, formulations need to change in order to help a brand have a unified look across the whole line. Outlier products and formulations can be challenging, as brands seek to build a cohesive look. For example, a cream may need to be made to a thinner consistency in order to flow properly out of the same pump you’ve already sourced for another product. That way, consumers can have a more unified experience with all your offerings. In addition, you are able to keep costs down and avoid the sourcing nightmare of unique cases for each product. More commonly, design reinforces the brand story in ways that words cannot. For example, color-coded caps can be useful for educating consumers about regimens, ingredients, strength, etc. A gold-lined cap can often convey a pro-level in a more effective way than words. Perhaps a brand is all about giving the consumer choices and control, and a “dial your own strength” cap or pump could further convey this, reinforcing the marketing concept. For natural brands, the selection of recycled and recyclable components is essential in achieving a consistent brand promise. Discordant components, especially from a materials standpoint, can leave a bad taste with consumers if they are not in line with the rest of the brand’s ethos.

Instilling Holistic Design Thinking With all the advantages we’ve seen, it would seem that taking a holistic view of

Design thinking will result in a brand that beckons shoppers from afar with packaging that communicates clearly.

design would be a brand’s top priority. Then why are there so few cohesive brands? Most companies are likely too caught up in the scramble to innovate, rushing the design process and not realizing their full potential. Fear of losing control to the creative team may also be a factor. They are often seen as prone to wasting time and money on costly dreams. Too often, companies are developing brands with a manufacturing-centered mindset. They’re in the business of making things, and introduce new products with rapid succession without much consideration for the consumer’s needs. Marketing departments must then create stories around the products, and the “decoration” is applied. The result is a number of similar products with no clear differentiation from the consumer’s perspective. Many design teams now have clear strategic processes to help focus creative exploration in a holistic manner. The creative team must be given access to all key decision makers and influencers. This allows them to ask crucial questions and innovate with experts from all arenas—R&D, product development, manufacturing, sales, etc. The result will be a brand that beckons shoppers from afar with packaging that communicates clearly. Consumers will become interested in other offerings

from their product line. At home, they will find that the experience of the item delivered the promise of the packaging. The consumer will then become a fan, and actively seek out the brand, which would be easily recognizable by its packaging.

Keep This in Mind If you and your team are still questioning the greater value of design and design thinking, consider this: One hundred percent of your customers will see your packaging. They may never see your advertising or visit your website. But they will see your packaging, which should be the distillation of your entire brand story and experience. Every investment you’ve made in your brand to date is riding on the magical moment your customer encounters your packaging for the first time. How can you afford not to invest in great thinking and design?

SHERI L. KOETTING is the co-founder and chief strategist of MSLK, a branding agency based in New York. MSLK specializes in helping beauty brands find their voice in today’s crowded marketplace through 360° brand positioning—from overall brand strategy to brand identity, packaging, retail experience, websites and social media campaigns. Contact: sheri@mslk.com or visit http://mslk.com/beauty-packaging/

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MARKETING STRATEGIES

In-home usage studies put your beauty care brand to the test and yield compelling consumer claims.

∑ In-home usage studies, or beauty product testing groups (BPT), can provide more targeted, intimate consumer feedback on products that can be applied to the claims that both retailers and shoppers demand. ∑ BPTs can be applied to every category, from skin care and makeup to more novel offerings such as ingestibles and beauty devices, the latter of which may benefit immensely from claims. ∑ Using clever strategies such as longer study durations, multi-product testing and targeting of male consumers, brands are discovering economies of scale that produce richer test results.

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| BY DENISE HERICH, TBC

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ast month, I took a close look at the evolution of focus groups, and how brands can use this powerful tool to gather critical qualitative data about their products*. This month, we turn our attention to other half of this equation—in-home usage studies, or beauty product testing groups (BPT), which put your product into consumer’s hands for the quantitative proof of efficacy that retailers and consumers demand.

Claims Matter BPTs are a powerful way to capture your buyer’s point of view and what she intimately thinks of your product—and, more importantly, of using your product. Like focus groups, this method is a timetested and vetted process that has been utilized by marketing directors and brand managers for decades. However, unlike a focus group, which is conducted in a controlled setting (such as a testing center) and guided by a moderator, BPTs free up your panelists to interact more organically with your products from the comfort of their own homes. As a result, they share far more intimate, targeted feedback, which you can then channel into compelling consumer claims. Why are consumer claims important? Because they help sell products in today’s competitive “prove it” shopper mindset: 94% of Sephora shoppers surveyed say seeing “honest feedback from consumers like you” is important for making a purchase decision, and 88% of them say that positive consumer claims are important to their decision**. 91% of women say consumer claims from women their own age influence their beauty product purchasing decision***. 91% of women look for strong consumer claims before buying a prestige beauty or personal care product. * “Tell Me How You Really Feel,” September 2016; www.gcimagazine.com/magazine/pastissues **2015 PinkReport: The Sephora Shopper, online quantitative study with 5,000+ U.S. female respondents, 2015, by The Benchmarking Company ***Online survey of 2,128 U.S. female beauty buyers, May 2014, The Benchmarking Company. www.GCImagazine.com

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How BPTs Work Often used to prep products for launch, as well as to breathe new life into existing products via updated consumer claims, BPTs have a traditional process: consumers are given a set of your products to use at home and then, at regular intervals, are sent survey questions which let them self-assess on a range of factors, including packaging, formulation, texture, scent and, perhaps most importantly, the results they see and that you want to claim. While it’s great to follow this time-tested method, there are exciting changes coming down the BPT pike that only make for stronger groups, and results.

Validating Novel Products In the past, many brands gravitated toward BPTs for a general category of topical products, such as cleaners, moisturizers, creams and serums. Today, that categorization has grown exponentially.

Now, brands are opting to get every sort of product possible into the homes (and hands) of consumers, including electronic personal care/beauty devices and ingestibles, to name a few—and with good reason. Devices, in particular, benefit from the kinds of intimate, personal claims and feedback BPTs generate. These products are one of the fastest growing beauty segments today. Consumers can now purchase devices for almost every part of the body, which address nearly every health or beauty concern, including cleansing of the skin, hair removal/hair growth, age spot/pigment lightening, wrinkle-fighting/anti-aging, general wellbeing and even mani/pedi benefits. These products, like ingestibles, are often completely foreign to a new user. Consumers want to hear how they worked on real people before they plunk down sometimes hundreds of dollars to make a purchase.

Another big evolution in beauty product testing is the rise of multi-product or system/set trials that are specifically designed to prove that a set of products work better together, versus when used apart or with other products. Marketing Strategies 49

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MARKETING STRATEGIES

The lines are blurring between women and men’s skin care, hair growth/removal products, hair care in general and even, to some extent, makeup, which means it’s time to start incorporating a broader consumer sample and netting even more powerful consumer feedback and claims as a result.

No matter if you are testing a more traditional product, a hair removal laser, a feminine care treatment or an anti-aging ingestible, a BPT can be constructed to meet even the most stringent testing protocols, and give you the kinds of claims that your target audience is seeking.

Slow Down Timing is another aspect of BPTs that has evolved. In the past, brands may have focused on testing one or two products quickly in an effort to gather the targeted data as efficiently and expediently as possible. Now, it’s not uncommon for brands to slow down, take their time, and conduct BPTs that last three, four or even eight weeks long.

Products with a longer efficacy timeline (such as 56 days) can easily be paired in one test with products that have a shorter efficacy timeline. Case in point: a company has a long-wear mascara, an anti-aging facial skin care serum and a hair thickening product that they want to test. Each of these products appeals to the brand’s same target demographic: prestige beauty buying women, ages 30–65, with concerns about skin aging and fine and thinning hair. A single test can be run on one panel group with these products being used in tandem and tested at differing intervals, along with different testing end points. The mascara portion of the test can end after one day. Did the mascara last a full 12 hours without reapplying? Did the

bold color last? The anti-aging serum portion of the test can last for 28 days with appropriate “fine lines and wrinkles” claims. Finally, after 56 days does her hair feel fuller? Is there a noticeable difference? Does she feel more confident about her hair and her appearance? Brands are discovering economies of scale with beauty product testing as well as richer test results.

Proving the System Works Another big evolution in beauty product testing is the rise of multi-product or system/set trials that are specifically designed to prove that a set of products work better together, versus when used apart or with other products.

50 Marketing Strategies GCI October 2016

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Get Men in the Mix

Brands are discovering economies of scale with beauty product testing as well as richer test results. A key part of this kind of trial is careful splitting of panelists into groups that test particular groupings of products in order to garner feedback on how well products do (or do not) work together. For instance, in a test involving a system of three products, group A might use the branded, three-product system, while group B might test two out of the three products, as well as a third, non-brand product.

www.GCImagazine.com

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By testing the entire system together, as well as testing components of the system with outside products, brands are able to capture vital consumer feedback that specifically speaks to the system overall. This feedback will not only inform consumer claims, it can also help consumers better understand how the system works, period—and hopefully convince her that your system is going to answer her issues and concerns.

Although female beauty consumers have traditionally been the sweet spot for brand managers and marketing directors, male consumers are quickly becoming a bigger presence in the beauty landscape overall. And not just for “men’s products,” either. The lines are blurring between women and men’s skin care, hair growth/removal products, hair care in general and even, to some extent, makeup, which means it’s time to start incorporating a broader consumer sample and netting even more powerful consumer feedback and claims as a result. Based in sun-seared San Diego, DENISE HERICH is co-founder and managing partner at The Benchmarking Company. The Benchmarking Company provides marketing and strategy professionals in the beauty and personal care industries with need-to-know information about its customers and prospects through custom consumer research studies, focus groups, its annual PinkReport, and consumer beauty product testing for marketing claims; www.benchmarkingcompany.com.

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INGREDIENTS & CLAIMS

Evonik has created several formulation concepts specifically designed to provide multifunctional male grooming. For example, the all-in-one Hair & Beard & Body Shampoo & Shower Oil combines the benefits of shampoo with those of beard grooming and shower oil. The oil formulation develops into a light foam and gently dissolves dirt from head and facial hair without drying. It is based on TEGO Sulfosuccinate DO 75 (proposed INCI: Disodium Ethylhexyl Sulfosuccinate), which solubilizes oil and provides efficient foam, and TEGOSOFT PC 31 (INCI: Polyglyceryl-3 Caprate), which reduces stickiness on skin.

Ashland has launched ChromoHance 113 polymer (INCI: Polyquaternium-113), a patent-pending technology for shampoo and conditioner products to shield oxidative color-treated hair from surfactant stripping. The technology maintains color vibrancy by forming a hydrophobic surface on hair.

Revolymer’s RevCare NE 100S (INCI: Sodium Polyitaconate) is a naturally derived film-forming technology that can replace petrochemically derived equivalents, while matching or exceeding their performance. According to the company, the ingredient has proven itself to be a versatile and powerful hair styling resin. The polymer is also a highly effective anti-frizz agent and can be used in a wide range of hair care formats including sprays, mousses and gels.

Mibelle AG Biochemistry has introduced RoyalEpigen P5 (INCI: Pentapeptide-48), which captures the epigenetic activity of royal jelly, which is responsible for queen bee development in nature. Recent scientific findings have shown that the component of royal jelly that drives queen development is the protein royalactin. The RoyalEpigen P5 ingredient was designed to use the power of royalactin to restore a youthful, even skin.

A new alternative to animal testing for skin sensitization, the human Cell Line Activation Test (h-CLAT), has been jointly developed by Kao Corp. and Shiseido Co., Ltd. Skin sensitization, or cutaneous allergic reaction, is a complex cascade of biological reactions, which has made the development of an animal test alternative to determine systemic effects difficult. The new h-CLAT test was adopted as the world’s first alternative method to test skin sensitization, focusing on the in vitro replication of functions in immune cells.

52 Ingredients & Claims GCI October 2016

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PACKAGING INNOVATIONS

Stella McCartney’s POP features a round fuchsia spray cap designed by Axilone and inspired by the brand’s iconic medallion.

Quadpack’s ash wood cap was recently used on Lalique’s Encre Noire à l’Extrême, a woody scent comprising cypress and vetiver. The cap, sourced from sustainably managed forests, is debossed with the brand’s logo.

API’s holographic technology, Holonique, was used to provide a 3D design to a recent Givenchy launch.

Geka Beauty has introduced epicEYES Mascara featuring its sensitiveFIBER bristles, which have an irregular surface that absorbs more mascara formula, thus transferring a greater volume to lashes. Toly’s round pinned hinged compact range, Anthea, features a curved split line between the lid and base. The compacts are available in four design variations, including a large size with a slim lid for face powder and a deep lid for a sponge. The compacts can be supplied with or without a mirror.

NovaLash has introduced packaging for its “Winks for Pink” Program. The brand will make a $5.00 donation to the NBCF (National Breast Cancer Foundation) for each Lash+Doctor sold.

Groupe GM has introduced its new design for the Eau Impériale collection of bathroom amenities, which was created for Guerlain in 2009. The Guerlain hotel line includes Eau de Cologne Impériale, and a new shampoo, conditioner, shower gel and body lotion design in 55 ml, 75 ml and 130 ml sizes, a 45 g glycerine filmed soap, as well as 40 g and 80 g vegetable cardboard box soaps. The range is now presented on a bespoke tray, with each bottle embossed with the Guerlain logo. www.GCImagazine.com

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Qosmedix ‘s mini natural colored polyethylene dramming bottles are squeezable and appropriate for serums, sampling foundations, lotions and other liquid-based formulations. The bottles are available in 2 ml (Part # 74230), 3 ml (Part #74231), 5 ml (Part # 74232 ) and 7 ml (Part # 74233) variations, along with a corresponding Dropper Tip Orifice Reducer (Part # 74234 ), a Black Screw Cap (Part # 74236) and a White Screw Cap (Part # 74235).

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PRODUCTS and SERVICES

showcase

CONTRACT MANUFACTURING

To reserve space in this section, contact

Kim Jednachowski kjednachowski@allured.com

1-630-344-6054

54 Products and Services Showcase GCI October 2016

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PACKAGING

PRIVATE LABEL

SERVICES

@GCI_MAGAZINE

www.GCImagazine.com

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Products and Services Showcase 55

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AD INDEX The Advertiser Index is provided as an additional service for readers to obtain information on companies and their products. The publisher assumes no liability for omissions or errors.

PAGE

ADVERTISER

PHONE

WEB SITE

BASF

1-973-245-6000

www.carecreations.basf.com

Bioscreen Testing Services

1-310-214-0043

www.bioscreen.com

Biosil Technologies, Inc.

1-201-825-8800

www.biosiltech.com

Brookfield Engineering Labs, Inc./AMETEK

1-508-946-6200

www.brookfieldengineering.com

Brownyard Group

1-631-666-5050

www.brownyard.com

Campo Research Pte Ltd.

11-656-383-3203

www.campo-research.com

Centerchem, Inc.

1-203-822-9800

www.centerchem.com

Classic Cosmetics, Inc

1-818-773-9042

www.classiccosmetics.com

Covestro/Bayer Materialscience AG

49-2148-4766-9757

www.baycusan.com

Deveraux Specialties LLC

1-818-837-3700

www.deverauxspecialties.com

Elé Corporation

1-708-442-9100

www.elecorporation.com

Fenchem Biotek Ltd.

86-2584-572-922

www.fenchem.com

Fusion Packaging

1-214-747-2004

www.fusionpkg.com

Cover 3

Inoac Packaging Group, Inc.

1-502-348-5159

www.inoacusa.com

Cover 2

JSN Packaging Products, Inc.

1-949-458-0050

www.jsn.com

Lipotec, LLC

1-201-850-1213

www.lipotec.com

Lubrizol Advanced Materials, Inc.

1-216-447-5000

www.lubrizol.com/personalcare

Mane USA

1-973-633-5533

www.mane.com

MORRE-TEC Industries, Inc.

1-908-688-9009

www.morretec.com

Pilot Chemical Co.

1-513-326-0600

www.pilotchemical.com

Sogecos/Cosmoprof Asia

Spectra Colors Corp.

1-201-997-0606

www.spectracolors.com

Spectrum Chemical Mfg Corp.

1-800-839-8774

www.spectrumchemical.com

Sun Deep Cosmetics, Inc.

1-800-985-2228

www.sundeepinc.com

U.S. Nonwovens Corp.

1-631-952-0100

www.usnonwovens.com

Vantage Specialty Ingredients, Inc.

1-973-345-8600

www.vantagegrp.com

28–29 Cover 4

3 47

5 51

www.cosmoprof-asia.com

56 Ad Index GCI October 2016

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THE ANATOMY OF A LEADER IN PREMIUM PACKAGING

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SYN®-COLL

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New efficacy study on Chinese volunteers reveals fascinating results In a new efficacy study performed on Chinese volunteers, SYN®-COLL confirmed its anti-wrinkle efficacy and delivered new results. After only one month of application, SYN®-COLL outperformed a market benchmark in a fight against lines and wrinkles. At 2.5% concentration, SYN®-COLL also helps reveal a more lifted, sculpted look , and refined pore appearance for smoother, younger-looking skin. SYN®-COLL is a patented, synthetic tripeptide that helps slow down the skin aging process. It mimics the body’s own mechanism, simultaneously boosting collagen production and protecting against collagen degradation*. Contact us to learn more insights on this product. *demonstration in vitro

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