FOUR CONSIDERATIONS FOR LAUNCHING A BEAUTY BRAND IN A PANDEMIC
I’ve been speaking to a few people these past couple of months regarding business launches.
Without a doubt, starting a new business requires many considerations regarding timing, market opportunity, product innovation/differentiation, funding and so forth. But the current climate - with the economic and social impact of COVID-19 - complicates this further, and deserves some additional considerations.
No one - no matter how much experience or success they’ve had - knows what product will be a success, or whether you should or should not launch a business. However, we can arm ourselves with better contextual understanding of the environment in which we launch a product or brand.
So with that being said, here are four variables we can examine, that will shape any business opportunity right now.
CONSUMER BEHAVIOR
As countries around the world implemented lockdowns, we faced numerous restrictions we had never faced before. This has resulted in adjustments to our daily routine, including changes to our purchasing & social behavior. Online purchases have surged, and virtual gatherings have increased exponentially over the past few months.
What does this mean?
Many retailers and brands have been forced to pivot rapidly in an effort to meet our needs. Launching now, means we can take our knowledge and own familiarity as consumers to apply them moving forward, without having to breakdown pre-existing practices and habits.
MARKET ACTIVITY
Marketing budgets are being cut left and right - and with that comes a domino effect for industries like digital or social media advertising, as the cost is often tied to demand. In the past, we’ve seen cost go up, in parallel with increased demand. Currently, brands from various industries are reporting decreased CAC (Customer Acquisition Cost), given that media prices are dropping.
What does this mean?
With CAC decreasing, ROI can increase and present a huge opportunity for some companies. Additionally, as brand chatter potentially decreases, it opens up space for new brands to have meaningful conversations with consumers.
NEWNESS
Humans, like you and I, love discovery.
Target, is a perfect example of a retailer that has capitalized on the joy of discovery. Speak to just about any woman, and they will tell you that they end up buying more than what was on their list.
Additionally, initial reports are indicating that customers are exploring new products and product alternatives. This could be the result of anything from your go-to product being sold out; your current go-to retailers having different selections; social or philanthropic considerations, as well as health/safety considerations, etc.
What does this mean?
New brands present new stories, new causes, and new emotional connections. There are many “new” needs that are not being met, which present an opportunity for new players. This could be a perfect time to be the “better option” given consumers’ shifting priorities.
REDEFINING SPENDING CRITERIA
Speaking of priorities, most everyone has had to re-evaluate their purchasing criteria. Some of these are driven by:
Cost
Quality
Convenience
Availability
While some customers find themselves purchasing the “next best thing”, one of the major considerations we need to keep in mind is that everyone’s definition of “essential” or “discretionary” is different. While on one hand consumers are forced to cut their spending, stressful times also lead to seeking comfort and striving to incorporate little indulgences.
What does this mean?
There are a variety of needs to be met. And as customers are left hanging by some brands/retailers (including top retailers), these represent opportunities for new and more agile players. Given a choice between Merchant A and Merchant B selling the same or comparable products, customers will choose the option that meets their needs the most.
Here are some challenges/needs I’m seeing to get you started:
Shipping and fulfillment delays
Insufficient/lack of communication
Shifting needs to accommodate WFH
Inaccessible/poor customer support
Tone-deaf messaging
If you’re considering a launch, what are your main concerns? Drop me a line here. 📨