NEW YORK — The tides of change aren’t slowing down — at least in the beauty industry.
“Our dynamic industry is changing profoundly, and that process will only continue,” said Estée Lauder Cos. Inc. chief executive officer Fabrizio Freda, the keynote speaker at the dinner Monday night ending the first day of the two-day WWD CEO Beauty Summit here. “Change is flowing like a current of the ocean — the question for us as leaders is how to harness these currents to better serve our consumers?”
“Leading change includes recognizing what should not change,” he said.
Freda suggested the way to make it through changing times was to remember what never changes — the importance of consumer loyalty versus novelty (moving customers from trial to replenishment), volatility as the new constant, and the benefits of a diversified business model, which Freda said is the “best way to rise above disruption.”
“My advice to legacy and pioneer brands alike — remember quality product and performance matter,” Freda said. “[But] creativity is still the differentiator that sets great brands apart…today a consumer wants a wow experience…[the] how of wow is creativity.”
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Weiss, who founded Glossier in fall 2014 and beauty web site Into the Gloss three years before that, might have launched her brand on social media, but still knows the importance of the physical shopping experience.
She maintained that she plans to “invert” the off-line beauty experience — and hers is not like a regular beauty store. Glossier’s SoHo showroom has a 65 percent conversion rate, likely a result of the strong connection Weiss has built with her consumers since the beginning.
“With Into the Gloss, I wanted to start creating this conversation where you’re really making beauty the main event as opposed to the ugly stepsister to fashion,” Weiss said during the sessions Tuesday morning, calling the destination the brand’s biggest social platform — despite it being a content web site. “I say that it’s a social platform because you can comment…we have a really robust comment section.”
Similarly, for geisha-inspired beauty brand Tatcha, customer intimacy is key as well.
Years after she sold her engagement ring, car and furniture to start the business, founder and ceo Victoria Tsai still responds to customer Snapchat messages herself — something she contends is scalable as the company continues to grow.
“Intimacy is very scalable,” Tsai said, adding that having people in place with the same customer-centric values system — such as the company’s Customer Love team — coupled with technology, allow the business to get customized messages to its clients.
Karin Tracy, head of industry of beauty, fashion, luxury and retail at Facebook, also stressed the importance of using technology to have a personal connection with consumers.
With more than 526 million beauty posts across Facebook and Instagram, Tracy discussed how traditional marketing is no longer the norm, as consumers receive almost all content through their mobile phones. As mobile becomes the primary channel where consumers are, brands need to adjust to their decreasing attention span and increasing demand for instant gratification.
“Consumers have bottomless makeup bags. There is room for all of us,” said Tarang P. Amin, chairman and ceo of E.l.f. Beauty.
While Amin is optimistic about the state of the beauty industry right now, he prefers to do things a bit differently and experiment.
“We hire from many big CPG [consumer packaged goods] companies….We ask them to do what used to take four weeks to do in one,” he said.
Another example, he noted, is that instead of E.l.f. having annual performance reviews, the team gives each other feedback. “We experiment a lot…we fail. But we fail small and early.”
Alan T. Ennis, president and ceo of Glansaol, talked about how he was “writing a new book” with Glansaol — a company he established with Warburg Pincus “to be the next great world-class beauty company,” he said.
The company has acquired Clark’s Botanicals, Laura Geller and Julep and is looking for new companies to buy to add to its portfolio, where the “ultimate exit would be an IPO,” said Ennis, former ceo of Revlon Inc.