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Can Marcia Kilgore do it again? The UK-based Canadian serial entrepreneur has raised an additional $ 100 million for Beauty Pie, her disruptive direct-to-consumer brand that’s building a loyal membership in the US and UK. She now she wants to develop it into what she calls Netflix for beauty. As always, Kilgore thinks big.
Beauty products are usually conveyed from the manufacturer to the supplier to the brand and then to the retailer, with costs multiplying with each step. A typical markup is 10 times the cost of making a product. Kilgore, who also founded Bliss, Soap and Glory, Fitflop and Soaper Duper, tried to tackle “crazy top ups” when it launched Beauty Pie in 2016. The company sources and purchases high-end products from a range of manufacturers. , selling them under its own private label directly to the consumer.
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Now, Beauty Pie will test the waters this month with clothing and accessories, starting with pajamas and an electric cleaning brush. In the summer, razors, refills, a bucket and towels will follow. Underwear, dresses and other basic clothing may be offered in the future, Kilgore says. The launches come from the latest $ 100 million injection, a Series B investment round in September 2021 led by Index Ventures, which has invested in Farfetch, Glossier and Josh Wood, and Insight Partners, which has stakes in digital companies like Shopify and Flip.
Kilgore’s goal is for Beauty Pie to become a one-stop shop for luxury beauty. Its offer to consumers is made up of quality products, conveniently available in pharmacy prices. Paid members have access to tinted cosmetics, skincare products, and fragrances at factory prices, while non-members can purchase but will pay the retail price. Beauty Pie has higher customer retention rates than Spotify and Netflix, according to Kilgore. The business became profitable in 2021, with membership numbers and revenue more than doubled, he says. The next phase of the company’s growth will be based on expansion and whether or not Beauty Pie can successfully launch its beauty spinoffs, in a difficult subscription landscape.
The convenience factor
Even as the pandemic is ending, consumers are still spending more on home life and online shopping, according to a 2021 study by Deloitte. Convenience and speed allow brands to stand out in an ultra-competitive market, says Kilgore. “It’s inconvenient for our shoppers to have to go to the store to get razors because we don’t have them. From now on, he can grab his blades while shopping for everything else. He doesn’t have to worry about doing everything. Plus we can get most things for half the price or even less.
Going beyond a brand’s core category requires an established level of trust among shoppers, says Candace Corlett, president of WSL Strategic Retail. “If you develop a solid reputation and follow buyers for your service, you can sell people a lot more.”