Beauty is a multibillion-dollar global business dominated by a few massive brands.
Competing with the likes of L’Oreal (LRLCF), Estee Lauder (EL) and Shiseido (SSDOF) is tough, especially for smaller companies. But one Singaporean startup, Allies of Skin, has managed to take on big beauty by building a global network.
The company started out in 2016 with just three products.
“It was a little unusual for this industry because you have brands usually launching with eight or ten products,” said founder Nicolas Travis.
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Allies of Skin now has seven products, and they’re not cheap. Prices range from 50 Singapore dollars ($45) for a small bottle of cleanser to 159 Singapore dollars ($120) for an overnight facial product.
In the beginning, getting noticed wasn’t easy in a crowded industry where three companies account for over 25% of the market, according to research firm Euromonitor International.
But Travis said he was persistent, repeatedly calling and emailing buyers. He eventually persuaded high-end retailers in a dozen countries to start stocking Allies of Skin products.
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The company was also tapping into a growing demand for niche and indie products. Cult brands like Glossier and NYX in the United States, and Charlotte Tilbury in Britain, have seen massive growth thanks to word of mouth and so-called online influencers.
The global industry for beauty and personal care products is expected to grow about 4% annually, reaching $430 billion dollars by 2022, according to Allied Market Research.
Digital sales are driving that growth. Shoppers are increasingly bypassing department stores, once the main place for selling high-end beauty products, according to a report last year from consulting firm Deloitte. Now, four out of five beauty shoppers research and buy products online.
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Allies of Skin is riding that wave: e-commerce accounts for more than half of its total sales.
Travis said he expects revenue to grow from $700,000 in the company’s first year to at least $2 million this year.
CNNMoney (Singapore) First published April 16, 2018: 4:27 AM ET