The beauty box concept started in New York just three years ago, with companies across the globe following suit and looking into the sampling business model following the success of main player Birchbox in the US. Birchbox currently has a subscriber base of over 330,000 to its name, a large number considering the entire Australian market is under 100,000 subscribers, according to Bellabox business partner Lance Kalish.
The beauty box concept sees subscribers paying a monthly fee (normally between $15 and $20) to receive a box of beauty samples delivered to their home. The last 18 months has seen a number of companies attempting to start-up the business model in Australia, but only a few have managed to survive. But those survivors are now reaping the benefits. Violet Box has seen sign ups increase by 50 per cent month-on-month since its inception in January, Bellabox’s membership numbers are constantly growing, and subscriptions for Lust have it! have risen by more than 1000 per cent in the past year.
bd spoke to the top beauty sampling boxes in Australia and some of the brands that get involved about the benefits to both customers and brands, the hard-hitting combination of e-commerce and sampling, and the projections of the new player on the market.
Beauty box benefits a two-way street
There are no losers when it comes to beauty boxes. Consumers receive the win of receiving a package of beauty samples each month for a small fee, while brands get to market their products to a highly fragmented market much more efficiently than with any other method. Marketing-wise, it’s the best return you’ll get on your investment. Get the product into people’s hands and they’ll start using it,” says Kalish.
Beauty boxes give established brands the ability to better connect with consumers through product surveys and social media feedback from the boxes, while also giving new brands the chance to reach customers that may not have heard of them or their products. This type of sampling service also helps reduce wastage. With traditional promotions, the brand may give away thousands of sample products with 80 per cent landing in the wrong hands and going to waste. When the Birchbox [US beauty box] concept was invented, basically you were targeting the right people with the right sample. If you put a sample into a box, you’re going to get less than 40 per cent wastage,” according to Kalish.
PINCHme executive chairman Jeremy Reid agrees that sampling is the most effective way to promote a beauty product. If you’ve been using a particular cream for five years and you’re happy with it and I come along and say, Hey, I’ve got this new one with new technology you should give it a go”, you’re not exactly going to go out there and spend $20 and buy the cream because I said so. If I can give you a sample and you have a good experience, then you have the confidence to go do it,” says Reid.
And the success of the sampling box market comes down to a simple point: consumers like to sample a product before making a financial commitment. Women like the beauty box concept because we like to try before we buy, especially beauty products. For a small fee women, can experiment with new products and brands and then purchase online with confidence,” says Jo Radcliffe, managing director of Violet Box who will be launching their first box in May. Bellabox founder Sarah Hamilton adds, People love the service as it is a way to trial products from home, remain on trend with the latest in beauty and discover new products that they wouldn’t have the means to. Plus, everyone loves a little gift box as a small indulgence in their hectic lives!”
Sampling and e-commerce
Digital media, social networking and ecommerce are dramatically changing women’s beauty shopping habits. Rather than relying on magazines and retail store personnel recommendations, consumers are turning to beauty sites, bloggers and social media, says Lust have it! CEO Greta Stojanovic. The problem with this is that they often find the variety of options become overwhelming and want to dabble with a few different products before choosing one. We believe sampling and digital marketing services like Lust have it! are a new solution to help beauty brands reach consumers in the digital age. The unique combination of real world sampling along social sharing and video content will play an increasingly important role in marketing and sales channels for the local beauty industry,” says Stojanovic.
Radcliffe agrees, saying the beauty box will revolutionise the online sale of beauty products. Up until now the beauty industry has been struggling with e-commerce. The main problem with beauty, as a category, is that women want to feel, smell and try the products before they buy them. This ultimately limits online purchases to products they already use. That’s okay if you just want to sell to your existing client base but no so good for growth. Some brands spend millions each year on marketing to the masses, most of it a very low return on investment. With a beauty box, the brand gets to watch the whole buying cycle from sample to feedback to purchase and have the analytics to prove it.”
From the brand’s perspective
Brands have chosen to get on board beauty boxes for various reasons. For Pure Fiji, sampling always gets the best response for their products as it gives people the chance to try how it feels on their own body. It’s hard to describe a product’s touch and feel in a glossy ad,” explains Pure Fiji’s Daniel Anania.
Beauty boxes were all about increasing brand profile for professional hair care brand . We wanted to get involved to reach a new target audience in a way that was measurable and in order to create brand awareness. We found it leads to online conversations and generating word of mouth,” says De Lorenzo marketing manager Bridget Bajada.
As well as increasing brand awareness, and Klorane both decided to get involved due to social media and PR exposure and the chance to gain testimonial feedback via market research that could be used elsewhere. marketing manager Emma Sykes believes beauty sampling is good for start-up businesses as it is a good awareness driver and provides an economical trial.
The flow-on effect
While brand awareness and data feedback is all very nice for brands, at the end of the day, the big question really is whether beauty boxes are leading to sales. Absolutely,” says Radcliffe. A recent statistic out of the US suggests that nearly half of all subscribers go on to purchase a full-sized product at some stage and nearly 90 per cent of subscribers are trying the brand for the first time.”
Lust have it! has witnessed this firsthand. During a recent campaign with a new Australian brand, 99 per cent of our members had never heard of the brand or tried their products before the campaign. After the campaign, 77 per cent were likely to purchase the product in future, 82 per cent intend to recommend the brand to family and friends and 20 per cent had already done so,” reveals Stojavonic.
The new player
A new sampling service called PINCHme officially launched in Australia last week, offering a revolutionary sampling and digital marketing platform that sees members able to choose from a selection of leading branded products to trial free of charge in return for their insights on the product. Rather than consumers paying for the samples, brands pay to be involved in the service in order to raise awareness and receive valuable customer feedback.
If you think about it, the top rating TV show would have several hundred thousand viewers. We’re able to give the brands similar audiences and we’re getting very good engagement from the consumers. The brand knows exactly where their product is going, so there’s very little wastage. The brand can see what the experience has been, who claimed their product and if they’ve gone on to purchase the product or not,” says Reid.
Into the future
With all new concepts, there are sure to be some hiccups along the road but for Violet Box, Lust have it!, Bellabox and PINCHme, the only way is up. Some may believe that this could be another e-commerce fad and that they don’t want to align their brand with something that may not be around in a few years time. I can categorically guarantee that the beauty box is not going away any time soon,” concludes Radcliffe.