BEAUTY

More Skin in the Game

It turns out mask wearing is encouraging a different kind of mask wearing. Three skincare brands just announced major updates to their US expansion formulas. 

In funding: Estee Lauder is increasing its stake in Deciem with a cool $1 billion investment, bringing the brand’s valuation to $2.2 billion and Lauder’s ownership to 76%. The motivation? Makeup sales are trending down, while skincare’s trending up. 

In distribution: French DTC brand Typology started selling in the US on Monday. Its web-first approach has worked in the UK and France—so its founder has no plans to change course.  

In franchising: NYC native Heyday is expanding nationally under a franchise model after raising $20 million. Investors are buying into its expert-led approach, both in brick and mortar and online. 

Remember when we said skincare is trending up? The global market is projected to increase from $134.5 billion in 2018 to $180+ billion by 2024, per Statista. And the US skincare market brought in ~$17 billion in 2019. Again, this growth comes at a time when more cosmetic beauty products are flagging.  

Democratizing skincare

With so much attention focused on reducing under-eye circles for Zoom calls, the three brands above want to set their serums, toners, and masks apart from the crowding industry. And like the skincare aficionados they serve, they’ve fine-tuned their routines: 

Partnerships: The Ordinary was Deciem’s 11th brand launch, but online Ulta and Sephora partnerships propelled it to the top of the heap.

• The brand is mulling more product expansions after its hair density serum went viral on TikTok. 

Data driven: Typology provides customers an online skincare diagnostic test. This gives the company valuable consumer data, such as identifying 24 different skin types.  

Unit expansion: With at least 40 new locations opening in the next five years, Heyday wants to be the Warby Parker of skincare. The company provides an in-person touch with help from professional estheticians. 

The takeaway: Today, these brands own niche market segments. Tomorrow, they hope to overtake the biggest drugstore brands. To get that counter share, they’re emphasizing personalized and affordable products.

DTC

No Pain, No Rogaine

Every DTC healthcare brand says it fills a bald spot in the market. But in hair loss treatments, the No. 1 spot officially goes to Keeps.

Keeps, the first of three brands to launch in Thirty Madison’s portfolio, told Retail Brew it’s the largest DTC brand in men’s hair loss care. 

• Revenue tripled from 2019 to 2020—and Keeps became profitable last year. 
• Keeps said sales “substantially” passed the $48 million that competitor Hims generated from its segment including hair loss products. 
• Subscribers increased 125% to more than 260K last year; Keeps also passed one million product shipments. 

Back to its roots. Keeps has combined clinician-recommended, FDA-approved treatments and discreet home delivery since 2018. That’s all it took to outpace its SPAC-ing competitors last year: “The aspects of the core value prop that were strong prior to the pandemic were just made stronger in the pandemic,” Keeps general manager Matt O’Connor told Retail Brew.  

Looking ahead…O’Connor said that “moving beyond DTC is part of the strategy for 2021.” We’ll see whether that means bespoke treatment centers or yet another wholesale bullseye.

SPONSORED BY ASANA

Flexibility Is the Future

We do yoga for the glorious five minutes at the end where you get to lie down, close your eyes, and do absolutely nothing. 

Most people do yoga for actual benefits like focus and flexibility—which we’ve heard is pretty transformative. 

Turns out, flexibility is equally important for how all of us will work in the future.

Asana is like the savasana yoga pose of your work management life. They understand the stretching, bending, and balancing required to thrive in the future of work so well, they created their Anatomy of Work Index report. 

Asana’s report underscores the idea that flexibility is now essential for businesses to flourish. In fact, one-third of employees surveyed say flex remote work setups help them focus more, and 35% say flex working hours also improve their remote work-life balance.

What yoga is to physical flexibility and focus, Asana is to work flexibility and focus. Meditate on that. 

Position yourself into a more flexible, engaged workforce with Asana. 

Q&A

Soho Sweet Home

Loeffler Randall built its customer base the old fashion way: wholesale first, with partners like Neiman Marcus and Barneys (RIP). But after 16 years of sharing space, the footwear and apparel brand is opening its first standalone store in NYC. 

About the timing…sure, the pandemic’s sent other brands packing for suburbia. But the new Soho storefront brings Loeffler Randall closer to its core customer, cofounders (and spouses) Jessie Randall and Brian Murphy told Retail Brew. 

+ The independence angle: Going IRL alone is one step in a broader DTC-focused plan. This way, Loeffler Randall can prioritize customers’ real-time wants instead of wholesale buyers’ demands—a move that’s already resonating through its website.

• Loeffler Randall’s DTC sales have increased 30% YoY, Murphy told us. 
• Pandemic pivot items, like a new line of slippers, quickly sold out.  

Looking ahead...Loeffler Randall is “going to be a direct-primary business within the next twelve months,” Murphy said. 

Loeffler Randall’s team had a lot more to say about adjusting their brick and mortar debut for the pandemic and evolving from footwear brand lifestyle brand. You can read our full conversation here.

WHAT ELSE IS BREWING

• TJX lost $1 billion in sales due to store closures in Canada and Europe.
• BigCommerce merchants can now list their products on Walmart’s marketplace.
• Home Depot said patio furniture and grills buoyed Q4 sales. 
• Shippo, a shipping software company, raised $45 million for a $495 million valuation.
• Macy’s expects online sales to reach $10 billion in the next three years.
• Walgreens secured its third same-day delivery partner: Instacart. 

SPONSORED BY ORACLE NETSUITE

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COMMUNITY

It’s time for our segment highlighting the best part of Retail Brew: you, the readers. We’d love to feature you in an upcoming edition—so why not introduce yourself here? 

Today we’re catching up with Raj Nijjer, CMO at e-commerce marketing platform Refersion (and CEO of adorable pupdates). 

Describe your job in a sentence: I help the coolest consumer brands on earth partner with influencers and their best customers.

Something we can’t guess about your career from LinkedIn: My love for product and engineering. I hold 10 patents from the US Patent Office!

Favorite project you’ve worked on: Launching DTC campaigns (over three years ago) and the “Amazing Women in E-Commerce” program at Yotpo. My aim is to create more programs that highlight underrepresented demographics and push for more D&I!

One retail account everyone should follow: Digitally Native.

One emerging retail trend you’re bullish on: Your best customers as your influencers and ambassadors! One example is Blenders Eyewear. They turned word-of-mouth advertising into a global phenomenon, with 4,000+ ambassadors promoting their brand.

SWAPPING SKUS

Major retailers have a case of consumer FOMO, but current supply chains can’t meet rising demand. As foot traffic ticks back upward, they’re scrambling to upgrade their supply chains. 

• On a quest to e-comm profitability, Walmart unveiled plans to invest $14 billion in supply chain and logistics this year. (FreightWaves)
• Earlier in the pandemic, manufacturers shrank inventories to shore up cash, which is now straining supply chains with returning demand. Some will need to ramp up production in the coming months. (WSJ)

ICYMI

Catch up on the Retail Brew stories you may have missed.

• Nuggets, Forts, Foamnasiums: The State of Children’s Play Furniture
• Small Retailers Heavily Rely on E-Comm, Facebook Survey Finds
• Yeti Launches New Travel Bag Collection