The Glossy Beauty Podcast

Ted Gibson and Jason Backe had to close one business to make another work.The married couple (a hairstylist and colorist, respectively) and business partners say it took closing down their flagship salon location on Fifth Avenue in New York City in 2017 to allow them to rethink their futures. What they landed on was a L.A. smart salon "powered by Amazon," that had no receptionist and no inventory -- their hero product, the Shooting Star Texture Meringue, was not sold in store, but on Amazon."We knew that that model of 25 chairs, 12 assistants, a huge front desk staff, the overhead of the product -- we knew that that model was a dinosaur," Backe said on the Glossy Beauty Podcast.In the latest Glossy Beauty podcast, Gibson and Backe talk about bouncing back from having just $2,500 in the bank because of Covid-19, how some beauty companies are all talk when it comes to supporting Black businesses and what the salon of the future looks like.

Uoma Beauty founder Sharon Chuter is more than ready for the reckoning coming to monocultural corporations in America."Now I can be more vocal about it because I have little to lose," Chuter said on this week's episode of the Glossy Beauty Podcast. "I didn't start my business to be a billionaire. It was part of me using a platform to speak up against what was going on."The Nigerian-born founder launched the #PullUpForChange campaign earlier this month, calling for the brands that had come out in support of Black Lives Matter to disclose the number of Black employees on their own payrolls, including those at the corporate and executive level."You're not giving them jobs," Chuter said about the brands. "You take their culture, you repackage it and you sell it back to them at a premium. Meanwhile, you're not employing them."Some beauty companies divulged these statistics, alongside promises to improve, but for Chuter, "pulling up" also means being held accountable for that down the line -- every six months, specifically."In six months, some people won't have made much progress. That's reality. Especially right now in the Covid-19 era," she said. "So we want to establish two national days where all national companies pull up for the Black community and let us see."The Black population makes up 13.4% of the country as a whole, but Black employees only account for 8.6% of Fortune 500 board seats and 3.2% of senior managers, according to data reported in The Economist. According to McKinsey & Company, only 1% of Black business owners get a bank loan in their first year of business, compared with 7% of white business owners. And The Washington Post found that only 1% of founders who have raised venture capital are Black; in 2018, 81% of VC firms didn’t have a single Black investor.Chuter is ultimately optimistic. "I have to be," she said. By way of solutions, she urged companies to develop executive talent from within a company's ranks while putting out calls for employment at historically Black colleges and universities; to front ad campaigns and messaging with Black models and organizers even at the cost of alienating certain consumers (or investors) who don't understand the moral urgency; and creating diversity boards that exist outside a company's own workforce."Unless they're independent, they do not have power to implement change because they answer to you, so they're going to give you the answers that you want to hear," Chuter said. "And that's something that every big company should be thinking of right now."

Beauty companies that fail to bring diverse employees into their teams, for executive-level to entry-level roles, aren't just at risk of failing on a moral front -- they're also leaving money on the table, according to Mented co-founders KJ Miller and Amanda Johnson."Money talks. So maybe you don't understand why it's important that I have a lipstick that works for my skin tone, but you can understand that black women outspend their non-black counterparts by 80%," Miller said on this week's episode of the Glossy Beauty Podcast. "The smart investors got it and they are now investors in a really successful brand, and the other investors didn't. And that's on them"Miller and Johnson graduated from the same 2014 class at Harvard Business School, and launched Mented in January 2017. Sales grew by roughly 400% in the following year, during which -- after pitching 80 VCs -- they raised a pre-seed investment of $1 million. In 2018, the company raised $3 million in further funding.In Johnson's view, "Diversity in beauty has always been 'a trend.' Sometimes it's really up, sometimes it's really down. It depends on what models are on the runway, what's chic in a season," she said. "But the reality is people of color have always been around."Regarding the killing of George Floyd and the protests that continue to sweep the country, Johnson acknowledged the gravity of the climate, especially as black founders and leaders."We’re making it," she said. "The thing that continues to brighten the day and push us forward is obviously, our families and our passion for the thing we’re building, but also our customers. We have had some of the most heartfelt emails and social comments over the last couple of months and weeks, whether it was about Covid[-19] or about social injustice, encouraging us to keep going, to keep fighting, that our company matters, that what we're doing is important. Sometimes just that one message is the thing that can keep you going in what is an incredibly difficult day."

The coronavirus pandemic has created more uncertainty for brick-and-mortar locations, but it's an opportunity for companies to ramp up the expertise and service stores were known for digitally."That is not going away," Unilever Prestige Group CEO and EVP Vasiliki Petrou said in regard to virtual consultations and other digital innovations. "It just will grow stronger. Being future fit is definitely taking that muscle to the next stage," she said on the Glossy Beauty Podcast of the group's brands such as Tatcha and Murad.And while that aspect of a brand's presence demands evolution, Petrou thinks that conversely, consumers these days are especially attracted to hero products from the brands they know and love."In crisis people tend to go back to the bigger, credible, iconic products versus, let's say, the more 'discovery' ones," Petrou said. "Consumers want to go to a safe haven."Petrou wouldn't confirm or deny rumors that Unilever Prestige was in talks to acquire British makeup brand Charlotte Tilbury, only teasing that "some [rumors] are true, some are not." But she did explain the company's overall approach to M&A."We're always about founder-led brands. We're always looking at new business models, new approaches, whether there's a big idea that's globally relevant, and definitely looking at all categories," Petrou said.

When Murad CEO Michelle Shigemasa turned the skin care company's focus to direct-to-consumer sales versus wholesale last year, it was with the goal of getting to 50% DTC within five years.Now Shigemasa estimates a much faster timeline. "I think that'll happen in the next two years, max," Shigemasa said on the Glossy Beauty Podcast."We've seen digital sales that frankly surprised us. We knew that they would accelerate, but to this degree, I don't think we understood," she said. Sales on Amazon and Murad's own website have also at last doubled, Shigemasa added.Like just about every company in the industry, the Unilever-owned brand is aiming to take as much customer engagement as it can online with the onset of Covid-19. Shigemasa called virtual events "One of the big challenges we have on our list that we're working on."Virtual "skin check-ins," an effort that involved shifting personnel from frozen brick-and-mortar outlets -- including Sephora, Ulta, Macy’s and Nordstrom -- have led to 300-400 appointments a day, she saidConsidering the uncertainty caused by the pandemic, Shigemasa sees no reason to look back. "When we look forward at brick-and-mortar, I'm not sure they'll ever be the same, to be frank."

In beauty, Biologique Recherche is the industry's definition of a cult brand. The French skincare company's products are only available in a limited assortment of spas globally, despite regular inbound requests from retailers. And on partners' digital sites, product prices are at first hidden; viewers must log in to see what they're in for. That might seem like a tough sell in a world where brick-and-mortar is struggling or still shut down because of Covid-19, and every beauty brand is multiplying its online reach to keep customers engaged and purchasing.But interest in Biologique Recherche's kind of beauty is on the rise, according to U.S. general manager Laura Gerchik. This is especially true online, where the the treatment brand has found a voice by leaning into virtual consultations and social media posts led by aestheticians."The online piece of the puzzle for us has always been about not diluting our brand equity, meaning that we really want online to be like a store experience," Gerchik said on this week's episode of the Glossy Beauty Podcast.

Telemedicine visits may be up, but people have less usual access to their doctors and other hair specialists (like stylists and plastic surgeons) for less than urgent care.Hair and wellness company Nutrafol works with more than 1,500 specialists, using them as their frontline to reach consumers with their clinically tested products. "We started to sell in doctors' offices, we started to sell in salons, because people trust their stylist," Tsetis said on the Glossy Beauty Podcast. "Their stylist is never going to recommend something that they truly don't believe in. They're not salespeople."At least, that was before the coronavirus pandemic took hold and lockdowns around the world began. Nutrafol reacted by creating a platform for those experts on its DTC site. "We did this in about three weeks. And this platform really enabled product sales in the professional channel while salons and offices are closed," Tsetis said. "It's a typical drop-ship model."A slump in customer acquisition costs "because a lot of other companies reduced advertising spending" has helped contribute to it. In April, according to Tsetis, Nutrafol's CAC cost fell 30% alongside a tripling of new customers.Tsetis talked about the importance of treating hair loss, especially as stress is at an all-time hight, steady sales growth on Amazon and how the company has avoided Covid-19-related layoffs.

Biossance president Catherine Gore has always considered skin care as medically significant, and believes customers will be more inclined to share that thinking as coronavirus lockdowns continue around the world. "Our skin is our largest organ, and it's also our first line of defense against outside aggressors," Gore said on the latest Glossy Beauty podcast.Education is a big part of Biossance's marketing strategy and value to customers. One of Biossance's central ingredients for skin care, for instance, is squalane, which it derives biochemically from sugar cane -- the larger cosmetics industry sourced a similar squalene (with an e) from a not-so-vegan source: shark liver.That makes a big difference for the typical customer who has more time to do her research, according to Gore: "What's actually driving her is a curiosity to do better for her own skin and the planet and to make better choices," she said.

Korean-based and -inspired beauty companies expanded rapidly in the U.S. and globally in the last few years, but AmorePacific turned to e-commerce sooner than others, a saving grace in this coronavirus climate."E-commerce was already very top of mind for us. This just sped that up. Right now, our penetration of our own brand dot coms has already doubled for year to date," Jessica Hanson, the company's U.S. president and general manager said on the Glossy Beauty Podcast. "In the U.S., Amorepacific sells its portfolio brands Amorepacific, Laneige, Sulwhasoo, Innisfree, Mamonde, Primera and IOPE. The company closed all 10 of its brick-and-mortar Innisfree stores in the U.S. on March 17, the same day as Sephora, where five of its brands are sold.And though the pandemic has halted those retail sales, Hanson said that customer loyalty is strong enough to keep sales afloat, especially on the domestic front. "The biggest piece of the luxury business has been in that traveler. And that's what is lost right now," Hanson said. "The level of travel is just not happening anywhere in the globe. But domestic sales have not shifted."

Beautycounter isn't your typical beauty brand. Given its network of roughly 50,000 independent consultants marketing and selling its products, company founder and CEO Gregg Renfrew feels "an enormous sense of responsibility to make sure that we are operationally sound," she said on the Glossy Beauty Podcast."I say it's both our opportunity and our responsibility right now," she said of the company's place amid the current coronavirus' outbreak. "Because it may be just a three-month, short term gig for them." But for others, she added, it could be a way to "continue to pay their mortgages, their rent, when other things have dried up."Renfrew said Beautycounter has seen a rise in younger consultants joining as a way not just to make money, but to find community in a time of frequent isolation.Overall, she thinks the pandemic will amplify the advantage of direct-to-consumer businesses like hers. "I think the wholesalers in general are in a lot of trouble right now. I hope some of them weather the storm. I think some of them will not, unfortunately," she said.