My inspiration for what you are about to read is borne from personal experience in the beauty business. In reflecting on my own career and in working with dozens of brands over the years, I realize that most entrepreneurs are driven by a dream or passion and always a gut sense of opportunity. They also tend to lack visibility or a clear sense of how they are going to get their business from where they are to where they want it to be (no end game in mind or plan). In many cases they don’t quite know how they got their business to where it is in the first place. Sometimes this is result of classic left brain / right brain conflict – creators and visionaries are rarely skilled in the nuts and bolts of business – and other times it’s a matter of savvy business people having little to no knowledge about this particular category of business. Regardless, knowing what you don’t know always helps to increase the potential for success.
With so much at stake including time, energy and capital, a framework for thinking about a brand and business is warranted. After all, success isn’t just something that happens, but rather a function of a clear plan, a lot of hard work, a little bit of luck, and patience. Herein are some of the essentials to get you thinking about your business and while not all inclusive, I encourage you to actively explore them on your own as well as with your team and your advisors:
1. Motivation: Why Are You Doing It? I know this isn’t a left brain focus area BUT it’s really important to be clear on why you’re in the game. It may be riches and fame, passion for an idea, an unmet consumer need or dream of being your own boss. Regardless of what it may be, there are no shortage of reasons that may have inspired you to get up off your seat but no matter what it is, building a brand (and business) is super hard work and the road will be bumpy. Getting clear on your personal motivation is critical to evaluating your true commitment and a valuable reminder along the journey. This is one area where your heart can lead so the more authentic your purpose for engaging in the venture, the better.
2. White Space: What Is The Opportunity? There are no shortage of brands in the market so what’s so special about yours and what is the consumer motivation to purchase what you’re selling? Articulating your brand’s unique attributes is critical and aligning everything from your top line positioning and messaging to promotional strategy and package copy and everything in between is key to success. One way to focus in is to focus out to understand who your customer is, where you can reach them in ways your competition isn’t currently doing so, and how you can market and sell in out of the box and in unexpected ways. You’ll also want to look at who is in your competitive set as well as their position, claims, pricing, distribution, POV, and product architecture. Key into the differences and include them as basis in your plan. Spending time looking at the world around you will help you see what you are doing much more clearly and will inform every decision you make.
3. Brand: What's Your Story? What are your brand’s DNA, core values and philosophy? Is your brand concept strong enough to be category changing or transforming? How are you different from the others? Do you clearly express these attributes through all touch points like packaging, collateral, training, and customer service? Is your messaging consistent across all touch points and audiences – trade, consumer? What’s your hook, leverage, hero, and voice? More often than not, brands don’t dive into these questions and simply getting aligned in these areas can be transformative to awareness and growth. Getting your story straight and telling it over and over again to all audiences across all channels is one of the most important things you can do right now.
4. Product: What's So Good About It? Whether your product concept is category creating or refining, there really needs to be some “there there” as the basis for what you’re selling. Often times, it’s not enough to put a pretty package on a shelf because while you may get a sale, this business is about repeat purchase. Do no harm and be deliberate. Make sure you can answer what is special about your product and why anyone should care. Make sure your product concept and architecture aligns with your overall brand, market opportunity and revenue projections. If it doesn’t, your business may be very short lived. Remember: the world doesn’t need another anti-wrinkle cream but if yours actually does something…well then that’s a whole other story.
5. Pricing: How Much and Why? Research the market to price your products and think about a few key things: Can you price much higher OR lower? Why or why not? With your current pricing and COGS, can you afford to sell in the channels and outlets in your distribution plan? Most international distributors command at least 75% off US SRP. Can you build an international business with your current pricing and COGS or will you lose money? The great majority of brands I have worked with did not give pricing and COGS much thought relative to their distribution strategy and in some cases, it was a business killer. Nail this part of your business down and ask for help if you need it. Even if you’re in the market already, it may not be too late to make a change. I increased SRP twice in one year and lived to tell the tale.
6. Marketing: What's the Plan? If you even have one, you’re off to a better start than most. A marketing plan and annual marketing calendar keeps your brand and business programmed and your marketing initiatives consistent and measurable. In this multichannel, global marketplace, your plan will address all communication and sales channels and range from social platforms and online to PR, retail and trade events. Syncing up your product launch schedule to PR strategy and all the above requires that you’re clear on a number of the items I address within as well as your distribution strategy. Ultimately, your marketing plan should be deliberate, repeatable, measurable and directly tied to your revenue objectives.
7. Distribution: Where and When? We have all heard the saying you can always go down market and it’s true. Figure out your distribution strategy early and if you’re already in the game, where can you go from here. Which channels, which retailers, and when? Distribution drives everything including revenue, marketing, inventory, funding requirements, field/team resources and so much more, all of which are major areas so without visibility, you can’t plan. Get smart here and model your business around this. If your objective is to sell you need to leave something for the next guy.
8. Operations: How Will You Push The Rock? Your brand needs smarts and resources. With clarity on the key areas of your brand and business, you can best address your team and operational needs as well as effectively lead and execute against it. I always vote for as little fixed overhead as possible but be careful not to cut too deep – without talent to plan and execute your business, you won’t go far. One way to get smart is to outsource. There are a number of options out there in marketing, back office and operations, and brand management that allow you to access the talent, operational leverage, and expertise you need without fixed overhead. The advantages of outsourcing are unlimited and include focusing your time and effort on what you’re strongest at while accessing resources you couldn’t afford or find.
9. Capital: How Much Gas Is In The Tank? One of the greatest things about having a well thought through plan for your brand and business is being able to thoughtfully rationalize the business opportunity. This also allows you to get clear on how much capital is required to start, grow, and manage towards your goals and objectives. If you can get this far, you’re ahead of the game. And, unless you have a rich uncle, you really need to cover off on this. I cannot count how many brands I have seen who not only live hand to mouth with no sense of their capital needs (and mostly because they haven’t had the tools to think it through) but also those who have blown through all their capital resources on packaging and inventory with nothing left to run their businesses.
10. End Game: Where Are You Going? In my experience, one of the single most important things to get clear on is what your goal for the business is because so few brands I have worked with are actually solid businesses. Is it to build a long term profitable enterprise that can support you for years to come? Is it to create value for shareholders and exit to a strategic or private equity firm? No matter the case, defining your end game provides context and the basis for your overall brand and business plan and should be one of the first things you think about before you even pass go. With the end game in mind, you are well positioned to consider large strategic issues along the way that impact your chances for success.
In my experience, addressing the key essentials herein and getting help to clarify the things you don’t know are crucial steps to increasing your potential for success. The business of building brands is hard work and if you’ve come this far, I’m eager to hear where you take yours from here.
