A 2023 McKinsey & Company report revealed that the beauty market generated approximately $430 billion in revenue, and is expected to reach approximately $580 billion by 2027, growing by a projected 6% a year. The report also showed that e-commerce in beauty nearly quadrupled between 2015 and 2022, and its share now exceeds 20%, caused by a number of factors including increased digital sophistication from direct-to-consumer players fueling this growth. This research is not exclusive to brands in the Global North or countries like India and China, as recent reports and industry observations indicate that in recent times, a paradigm shift has occurred within the retail space, and young brands are increasingly embracing a direct-to-consumer (DTC) business model. For young African beauty entrepreneurs entering the beauty industry, the DTC model offers unparalleled opportunities for growth and innovation.

Having set things in motion to fully launch during the summer with a tanning hero product, Chioma Ndubisi and Chineme Elobuike, Nigerian-American co-founders of beauty brand Deeper Skin, are deciding to kick off with the DTC business model. “Accessibility is really important to us,” Ndubusi tells BeautyMatter. “We want to make sure that we’re able to create a space where people are able to access our products using DTC, but also activating via Amazon, and just ensuring that we’re able to reach all people,” she continues.

Deeper Skin prides itself as a clean, vegan, cruelty-free, naturally derived DHA+ booster brand whose product contains ingredients like hyaluronic acid and South African collagen booster, all aimed at correcting hyperpigmentation for medium to deep skins. According to a study published in the Journal of Clinical and Aesthetic Dermatology, dermal pigmentation affects up to 75% of individuals with skin of color. In solving this problem, they were 2023 semifinalists for Pharrell Williams' Black Ambition Prize, and have also won first place at the third edition of PitchHU, which came with a $15,000 grant. The duo has since raised an accumulated sum of $40,000 in grants.

This departure from traditional retail channels signifies a strategic pivot towards a more direct and intimate relationship with consumers, and enabling brands to exert greater control over their distribution, products, messaging, and overall brand experience. “I think it really comes down to distribution,” Liz Kressel, founder and CEO of e-commerce and live shopping agency Lizard Strategy, tells BeautyMatter. “When distribution channels start to get cut off in a lot of ways, it makes more sense to go direct to the consumer, because they own the relationship with the consumer. But if it's in the store, then they own that relationship so brands have no control over that relationship,” she continues.

Kressel also opines that one of the primary driving forces behind the shift towards DTC is the evolving behavior of consumers. “With the rise of digital technology and social media, consumers are increasingly seeking authentic, personalized experiences from brands,” she says, “and by bypassing intermediaries and establishing direct relationships with consumers, DTC brands can deliver tailored experiences that resonate with their target audience, fostering a sense of connection and loyalty.”

By limiting the use and need for traditional retail infrastructure and distribution networks, DTC brands are significantly reducing barriers to entry and scale more rapidly. For example, launching with retailers requires specific amounts of commission and cost-cutting, which may significantly chop into the brand's finances, with little to no promise of a substantial ROI. This democratization of access allows emerging entrepreneurs to bring their unique visions to market and compete on a level playing field with established players.

Princess Ebi, founder of Nigerian beauty and bodycare brand Blank Body Beauty, tells BeautyMatter that upon its launch in Q3 of 2024, their choice of  business model in the African market, which is worth well over $62.14 billion, would be a DTC model, largely because of how inherently flexible it is. By maintaining direct control over their supply chain and production processes, she reckons that Blank Body Beauty could easily adapt to changing market trends and consumer preferences. This agility enables DTC brands to experiment with new product offerings, formulations, and marketing strategies, fostering a culture of innovation and creativity within the industry. “It allows us to have that closer touch when it comes to elements like packaging, for example, where we can write really nice handwritten notes, and give very nice personal touches,” Ndubisi chips in.

Also, central to the success of DTC brands is their ability to deliver exceptional consumer experiences. “Experience management is big for us,” Ebi says, “and we have found that sometimes, with the few retailers that exist here, they may not have enough investment or training to staff, who would deliver the kind of experience you want for your clients.” From seamless online shopping experiences to personalized product recommendations and responsive customer service, young DTC beauty brands in the continent are intentional about the needs and preferences of their customers at every touchpoint, and believe that they may have to take it on themselves. By cultivating strong relationships with consumers, brands are fostering loyalty and advocacy, and driving long-term sustainable growth.

However, while the DTC model offers numerous benefits, it also presents its own set of challenges, particularly in the African context. Infrastructure limitations, including unreliable internet connectivity and logistical constraints, can pose hurdles for brands seeking to establish a strong presence. “Running a DTC especially in Nigeria may mean that there’s a loss of focus in a way, as you would almost become a logistics business,” Ebi says. “It takes you away from your core, and the lack of infrastructure maybe means that you’re managing your own fleet, except you look for partners,” she continues. Additionally, building brand awareness and trust in a crowded marketplace requires strategic marketing and branding efforts. “The plan for our first year after launching is to create pop-ups and gather consumer insights and data on what our best methods of approach and standing out would be,” Ebi adds.

Ndubisi emphasized the importance of authenticity and transparency in building trust with consumers. “In the age of social media, consumers are more discerning than ever,” she remarked. “By being transparent about our ingredients, sourcing practices, and values, we can establish credibility and resonate with our target audience." Kressel highlighted the role of community-building in driving brand loyalty. She says that “brands need to actively engage with their customers through social media, events, and educational content. By fostering a sense of community, they not only deepen their connection with customers, but also leverage their feedback to iterate and improve their products.”

This shift towards a DTC business model represents a transformative opportunity for young African beauty brands. By embracing digital technology, fostering authentic connections with consumers, and prioritizing innovation and agility, these brands are not only redefining the traditional retail landscape and the access of customers to products, but also rewriting the narrative of the African beauty industry. As the DTC movement continues to gain momentum, it is essential for brands to remain agile, responsive, and customer-centric to thrive in this dynamic and ever-evolving marketplace.