Skinification, premiumization and ritualization are the trends driving the prestige hair care business, said JuE Wong, chief executive officer of Olaplex.
“Women today are asking — if I can get so much for my skin care, why can’t I do the same [for hair], especially considering the scalp is a continuation of the skin,” said Wong, discussing skinification — referring to the rise of sophisticated formulas used in hair care products that have typically been utilized in skin care.
“The other thing is, when you are willing to look at skinification of hair, you’re also willing to pay a little bit more,” she added, conversing with WWD’s senior editor, Allison Collins.
Consumers are willing to pay a premium price for technology, quality and result-driven products that work, she told the crowd. And, similar to skin care, there’s an element of ritual that’s embraced with hair care, allowing for a returning consumer.
Founded by Dean Christal in 2014, Olaplex — a patented bond-building hair brand — dominated headlines this year after going public on the Nasdaq, raising a $1.8 billion IPO with a valuation of around $16 billion. The company predicts that it will end the fiscal year with at least $580 million in net sales.
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“The majority of that growth is with our core customers and in our core growth products,” said Wong.
A major key to the brand’s success — now a team of 120 (all working remotely since 2014) — has been linked to its initial popularity in the professional hair community who used Olaplex on their clients to repair hair damaged by color and bleach. In fact, 35 percent of Olaplex customers are referred by professionals, revealed Wong.
“They are willing to refer their customers to us whether it’s online or to brick-and-mortar and 50 percent of our direct-to-consumers actually told us they also buy at professional and specialty retailers,” she said. “So that synergistic omnichannel is really powerful.”
The professional world offers the brand “authority and credibility,” Wong added, while specialty retailers like Sephora create brand awareness, and the direct-to-consumer channel provides consumer insights.
The company is looking to drive its hero product as well as launch a steady stream of newness. “We will continue to look at two to four products a year, and one specific for professional,” Wong said of product development — a one-to-two-year process. “But it has to be incremental to our business. It cannot cannibalize what we already have. And in the case of an event that there is a product that you think might cannibalize, we would like to make sure it also attracts a new customer.”
The executive lists North America, Italy, Germany, Spain and Asia — particularly China — as leading prestige hair care markets today and moving forward. “China is a $9 billion market,” she said. “The total prestige hair care market is 77 billion. China is already more than 10 percent of that total prestige.”
Discussing the differences between markets, Wong said: “North America and Europe look at it more as a damaged hair…because they are doing things to damage their hair. The Asian community doesn’t recognize that there’s damage, but what they do recognize is they can prevent damage.”