Questions for discussion
Bloomberg Businessweek Case in the New In Style: Beauty Brands with Social Media Cred Author: StephanieWong n half a century ago, director at TSG Consumer Partners innovation: Ho says. They also founder Charles Rev. LLC, which bought a minority stake want what's called "authenticity. s Lo 71,7-2,7-3.7-4,7-5 Revion f famously described the true in a little line called IT Cosmetics in which roughly translates into an of cosmetics makers: "We 2012. The company reached sales interesting backstory from a pho- Today the same could of $182 million last year, when TSG togenic founder who applies the son sel hope sald about what the large. orchestrated its sale to L'Oral SA personal touch. At Huda Beauty. established beauty houses see in for $1.2 billion. "There's a lot of founder Huda Kattan, an Iraqi mall social media-driven makeup capital chasing investments, says American who lives in Dubai, stars companies. The prospect of woo- Welch. in video tutorials demonstrating the millions of millennials whoBig cosmetics companies used how to use her latest products: to turn up their noses at any acqui- purchase decisions on online likes, sition with less than S100 million customers on her blog, beginning follows, and reviews from influenc- in annual sales, says Vennette Ho, her responses with "Hey honey" a managing director at Financo. Now there's practically no bottom because revenue can climb fast base their makeup and skin-care she also answers questions from ers has sparked a feeding frenzy for small, hip brands. The 52 acquisi- tons in the beauty and personal- care industry last year were the most in a decade, and some of hottest targets were private ands with massive social media Her Instagram followers exceed Authenticity is what makes it if a line suddenly catches digital work says Claudia Soare, presi- 18 million. dent of Anastasia Beverly Hills, ptive to social the celebrity salon empire her mother, Anastasia Soare, founded Los Angeles, Anastasia now oper- fire. That's because millennials and teens are so rece media tips on what to buy, and an bases, according to investment because word-of-mouth is the pri- in 1997. Started in a rented room in mary factor behind as much as 50 bank Financo LLC f there's any slowdown this year, percent of their purchasing deci- ates Brow Studios in 80 Nordstrom fl only be because demand for sions, according to McKinsey&Co. stores nationwide. Anastasia Beverly Hills-a favor- buyout candidates outstrips sup- These days, "consumers are y says Colin Welch, a managing gravitating to smaller brands with ite of many Alisters, including Kim 253