RAW IS EVERYTHING: Using Data To Start My Own Skincare Company
How I have used customer data to start my own skincare company and figure out what women really want.
It is obvious to anyone starting a business now that data is crucial in evaluating your product, go-to-market strategy, market trends, and customer response. As more and more consumers turn to the Internet to buy products they have previously purchased in physical stores, data collection and analysis is becoming increasingly important as a way to evaluate the stickiness of your offering and sustain your vision. I am preparing to launch my own e-commerce company this year at HBS, and I have used data analytics every step of the way.
My company, RAW IS EVERYTHING is attempting to disrupt the skincare industry. The problem my company is addressing is the fact that the European Union has banned 1,373 chemicals from skincare and cosmetic products, and the FDA has banned 8 and restricted 3. Product safety legislation has not changed since 1938, and many of the ingredients in our cosmetics and personal care products have been linked to cancer, neurotoxicity, and reproductive harm. The average woman puts 515 chemicals on her body every single day. Up to 79% of women report having sensitive skin, and 97% of women believe personal care products should be regulated.
The corporate beauty industry is one of the biggest and most powerful industries in the world. The global beauty care market is anticipated to reach $461 billion by 2018. The U.S. market for organic skincare products is expected to grow at a rate of 10.2% per year from 2014 to 2018. Though there are no barriers to entry and competition is fierce, there is a growing need for safer and more accessible products made by women, for women.
RAW IS EVERYTHING is pure, powerful, unformulated skincare. We have searched the globe to find the highest quality organic oils extracted from nature. Our oils are so powerful they can stand alone, untouched, without any additives or preservatives. Each product contains only one cold pressed, unrefined, multi-functional oil sourced sustainably from communities around the world. These ancient beauty secrets have been used and tested by women for centuries, prized for their ability to heal, moisturize, and protect all skin types for women of all ages.
So how have we used data to drive value creation and value capture? During FIELD 3, we conducted a beta test of five facial oils with 160 women, across 25 states and 7 countries. 146 customers filled out a thorough survey describing their skin types and concerns in exchange for one free product sample. We used customer data to match users with a product that would benefit their skin type the most. Customers were told the product’s function and were given instructions on how to use it and when, but they did not know the product’s ingredient for three weeks, or that the product only contained one ingredient. 80% of our testers found the product to be highly effective, and 80% said they would buy the product.
These surveys provided valuable data and feedback for our design process, as customers shared advice for alternative packaging, reaffirmed our commitment to oils in an unrefined state, and confirmed our hypothesis that raw, single-ingredient oils can serve every function in a woman’s beauty routine. We used this invaluable customer feedback to pivot and switch out two of our oils to more luxe, exotic offerings. We also hired a professional design team to redesign our logo and branding in order to achieve a higher-end brand perception.
Data has also helped to clarify our marketing plan. Instead of following the corporate industry standard and hiring passive models to pay to publicly endorse our products, we partnered with four RAW “role models,” real, inspiring women who love our products and want to authentically represent our brand. We could not decide which model should be on the homepage of our website, so we decided to crowdsource the options and use customer data to help us choose. We posted the photos on Facebook and Instagram and put the power in the hands of our followers to “like” the one they liked the most.
As you can see, the photo of Atima received the most likes, so her photo will be on the homepage of our website. We plan to do the same evaluation with future product launches, packaging decisions, and strategic partnerships.
Data has been at the forefront of our development of RAW IS EVERYTHING. Moving forward, we plan to use the data we have collected to guide our decisions and drive our understanding of what women really want.
First of all, what you are doing is awesome and I really admire you for speaking truth to power!
This sentence in particular really stuck out to me: “The average woman puts 515 chemicals on her body every single day. Up to 79% of women report having sensitive skin, and 97% of women believe personal care products should be regulated.” I am right on board with this, yet I still use many of the chemical-laden products that I am used to. I am trying to switch over, but I find that sometimes the more natural products aren’t as effective. I think part of it is that I am hesitant to believe that a natural product could work just as well, if not better, given the lack of side effects. The industry is sticky in this way. Once a woman finds a product that works, she is hesitant to drop it for something else.
One question I would have is how to overcome this initial hurtle – will you take a similar approach to selling as you did with your survey testing? I think that this could really drive adoption by offering a risk-free means of trying out a new product. Maybe it’s even a multi-stage trial period, which involves trying one product, providing feedback, and then receiving another that is even closer to what the user needs. So the product evolves from “learning” from the consumer. Seems like each product would be customized in this case though!
Another fascinating question would be how to apply data collected from the physical body in creating these natural products. I’d love to know how putting chemicals on our skin effects different organs in a real-time way. Maybe this is a marketing video with the help of a skin care scientist / specialist? Food for thought.
Beautiful, Atima!
I like how consumer-centric Raw has been through the product development phase. I was thinking how you could use your data to run regressions to find statistically significant trends, because that would be extremely powerful to your brand and mission. One opportunity is to target consumers on the fence.I bring this up, because the first set of consumers seem to have been more open-minded to organic skincare given the fact that they were willing to use a product on their body without knowing what it was. Therefore, they self-selected in, which makes sense for figuring out how to make your target consumer happy. However, to bring in consumers that are more hesitant, Raw can purposefully test skeptics (extreme users) and measure their subjective feedback as well as an objective professional’s feedback after using the product for a certain amount of time. You can then run a regression on this set of consumers to learn what demographics are skeptical as well as gain supporting research to show them that shouldn’t be. Good luck!
Thanks for sharing this, this is awesome! I suffer from sensitive skin due to atopic dermatitis since I was born, and finding quality cosmetics is very challenging. To this day, I have found a few brands that I use, but still not one that works well enough that I think I will stick to it forever. I agree with Tikola’s point that the “hesitant users” or skeptics might be a potential large market, which is harder to convert than the volunteered test takers who are already in an open mindset to try a new product. The skeptics are the people who haven’t found the perfect product, but is reluctant to try something new because the current product they are using isn’t “that bad” either. To these people, concrete proof is the key element to persuade them to take action and this is where data from first movers comes into play. I think the sequence of your market testing is correct, but maybe as the data shapes up, it is good to keep in check whether your target customers aligns with your brands core mission, and they might not be the first movers.
Can’t wait for the launch! I wonder what ways RAW might be able to use, um, raw data (hehe) to actually serve as a differentiator in the marketplace. Using data as you mention is table stakes for doing business in this era, could RAW be built around this principle and marketed as such to the consumer? People can be sensitive about data use, especially when it comes to personal data, but in aggregate it seems that people like the validation. Maybe an operating principle of your company is to use efficacy studies in a new and different way than how the traditional industry operates. January cannot come soon enough!