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How do beauty gurus launch their products?

Looking into the world of cosmetics, we can see an enormous, growing economy. The personal care products industry is now valued at $237 billion of the US GDP and supports 3.6 million jobs that earned $144.3 billion in wages and incomes in just the US alone.

2019 was a busy year in the beauty industry. We’ve got makeup launches from Tati Westbrook, Jaclyn Hill, and even Selena Gomez… It’s a crazy year.

Now, how do beauty entrepreneurs and beauty gurus (well, usually their managers) launch their products? Let’s look at the steps involved if you want to launch your own cosmetic product. We’re going to look at the physical steps, assuming you already have a million-dollar idea.

First, start a business. Pick a type of business to set up. Depending on your free time, financial abilities and recognition, you want to choose between a sole proprietorship and a partnership (which is owned and operated by you, or you and a friend), or an incorporated limited liability company (LLC). Most of the bigger beauty companies we know are LLCs. Aside from this, you want to gather enough finance and specialized professionals. This is where things become tricky for small entrepreneurs. If you’re not a millionaire, a beauty guru, a celebrity, or all three, you’re going have to look into debt fracturing, bank loans and venture capital, which often comes with a bit of a risk. So, after a tedious legal process, you have your company.

Second, create a brand that stands out. A brand needs personality. This comes through a good name, a good logo and a good image (well, sometimes, because apparently a bad image does better at attracting engagement these days). Now, let’s look at some examples. When we think of Jeffery Star, we paint a luxurious, extra, boogie kind of picture, and that is exactly what his brand expresses. His brand stands out because of the extravagance of the design, the boldness of the color choices, the ingenuity of the themes and Jeffery’s explicit, personal involvement in the brand. We see minimalistic themes in brands all the time, and Jeffery has a point of differentiation from the generic brand. A bad example could be Tana Mongeau’s recent perfume launch, featuring a very commonplace design and a rather lousy (or nonexistent) backstory. It doesn’t connect to Tana, and consumers don’t see anything special, anything to remember about it. Alright, after conceiving of a brand full of personality, you could get it trademarked and registered, after which you can start profiting off of it.

Third, define or determine your target customers. We have to pull the Tana Mongeau example back in here. Every successful brand or line of products has a target market. The products themselves and the price of the products need to adhere to the preferences and purchasing abilities of the targeted customers. Tana’s perfume, on the other hand, has no clear target market. Her audience mainly consists of teens, but her price tag is set at an astounding $48. Those who want her products can’t afford it, and those who can’t don’t necessarily want it. How are you supposed to profit this way? This illustrates lethargic (or nonexistent) market research. Good targeting (or market segmentation) could involve, for instance, teenage vegans, or people with curly hair. Products and prices could be tailored to fit the audience in this way.

Fourth, creating the business model. A business model is basically your company’s mode of making money (how your business makes money). For example, the traditional 4P’s (product, price, place, promotion) is a way to make your coins. Consider how you address these facets of your business in your business model and be creative and daring. Every company makes money in different ways, and there are no rules to follow.

Fifth, product development. Now we get to the exciting part. This is where your product really comes to life. Let’s look at some of the least costly and time-consuming options.

Private labeling is when you partner with a co-packer who already developed formulas and has a lot of “stock” formulas available at hand. You can select what you like, and the manufacturer would produce the product with you brand name on you preferred packaging. This is what smaller or busier beauty gurus usually choose. It is the fastest and most convenient way to launch your product.

Now, some beauty gurus may choose to collaborate with co-pack manufacturers in the research and development phase. This is where you see all those pictures of the beauty gurus in labs, poking at syringes and all of that. This is also more cost effective than starting the whole process on your own, as producing in bulk can save you a lot of money.

When developing an original formula (like Jacqueline Hill did with her 2017 eyeshadow palette launch, you should expect huge amounts of investment but a very exciting result (if management is sufficient). Select a good cosmetic chemist, or someone with cosmetic chemistry experience, and be involved, communicative and engaged in the process. Once your prototype formula is complete, you could move onto package selection. This part may be where people have the least incentive to invest, but it is almost as important as the formula itself, and should require just as much effort and money input. Now, with a prototype and packaging, it is then time for due diligence, stability, microbiological, safety, consumer, claims and scale-up testing, which will help ensure that your product is authorized and safe to put onto shelves, and will also help mitigate future risks with your product. And… you are now ready to make the launch happen.

Whew! So, these are the five steps in launching a cosmetics product. If you have a million-dollar idea and, hopefully, a million dollars, would you give it a try?

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