German-born HelloBody embodies a new generation of DTC brands—a profitable business model, demonstration of scalability across channels/products/countries, and a competitive advantage. Founded in 2016, the Invincible Brands-backed company claims to be the fastest-growing brand in Europe with €65 million ($73 million) in sales.
For HelloBody, community drives everything. From day one their focus was on building the brand, not just selling products on a nice website with cool marketing. They take community so seriously that every new geography is launched with a market-specific website, social platforms, and a local team to support the business and future the community. They are in numerous European markets such as Germany, Austria, Switzerland, Italy, France, Belgium, and Poland, and opened an office in Los Angeles in 2019.
We caught up with the dynamic CEO of HelloBody Monique Hoell to talk entrepreneurship, market nuances, and their winning DTC business model.
Can you share a bit about your background and how you found your way to the beauty industry?
I started my career in the German start-up scene when I was about 24 years old. Before this, I earned a bachelor’s degree in Business Administration and Management (2011) from Otto-Friedrich-Universität Bamberg. I have always been a very hands-on and pragmatic person and started to work on different projects as soon as I was legally allowed to do so—in Germany (that’s where I grew up) that’s from the age of 14. I have over 14 years of experience driving strategy and business growth in Tech (B2Btech, ADTech, HRTech, and BeautyTech.)
Prior to joining HelloBody, I was already very involved in the blooming Berlin start-up scene. I co-founded and was the Managing Director of Sixtyone Minutes, a marketplace (app and desktop version) for personal assistants. At Sixtyone Minutes, I scaled a team of 25 in Business Development & Customer Support and led the acquisition and implementation of 300+ cooperation partners. With Sixtyone Minutes I won international start-up awards and was even featured on the German Shark Tank. None of the jury members invested in the project at that time, nevertheless I took this supposed setback as a learning experience and an opportunity to grow.
After that, in 2016, I took over the then-unknown HelloBody—back then only a small e-commerce project—and the story began.
Have you experienced any differences in start-up cultures and the investment community in Germany vs the US? Europe tends to be risk-averse when it comes to making investments—that can be helpful as it creates a value-driven environment that’s looking for profits instead of wages. On the downside, it can lead to a potential setback of land grab or innovation. It starts with investing parties being very careful as to whom and what to invest how much in; it does not end with founders being too afraid to take (calculated) risks that could be the groundbreaking development your company had needed in order to reach an important threshold or differentiate itself from its (international) competitors. These characteristics interact with each other and of course they play into a bigger macroeconomic picture, that’s being influenced by additional stakeholders such as politics, society, or economy itself. I don’t want to point fingers and vouch for the one or the other—there are negatives as well as positives to be found on either side.
You mentioned two very interesting learnings from your previous start-up; one was the impact of a dysfunctional founder team. This is often not talked about, but it is a very common issue and a reason many start-ups fail. Would you share any insights from your experience?
Your personality contributing to the reason why something is not working out is a very intimate topic and not an easy pill to swallow. This is not about blame or pointing fingers. I believe everybody is good at something. But sometimes the strengths of different individuals are not compatible. When you’re building a business, an organization, and a team, you will go way beyond a regular 9 to 5 job. Being an entrepreneur is a mindset. Your business and its ups and downs will be your steady companion. It is crucial to be on this journey with someone who shares similar values, views, or work ethics. When you’re in a dysfunctional setup it takes time to start realizing something is not working out interpersonally. And it takes even more time (and guts) to really acknowledge that fact and take action.
The second learning you discussed was the product-market fit. Can you share where you when wrong in your last business and how you approached building the HelloBody brand differently?
In my first company, we had not really identified a need in the market and then developed a solution for it. We had first developed a product and then looked for problems in the market it could solve. Problems, however, are diverse, and trying to solve them from the top rather than from the root can be frustrating. With HelloBody I identified the need—in Europe there was no natural skincare brand for young women—yet young people increasingly started to care about conscious consumption, and with that, about conscious skincare routines.
How would you describe the DNA of the HelloBody brand?
I am not a person of big words. I am down to earth, authentic, and I believe nature is the key to beauty—any kind of beauty. There are a few beautiful brands out there that catered to the segment of natural skincare, yet I was lacking the pinch of boldness. Of quirkiness. I wanted to give young women the opportunity to have fun with skincare. I wanted natural skincare, high quality, and high performance—yet with a pinch of fun. That’s why HelloBody is colorful and loud—and high performing and qualitative. And very authentic.
And with an increase in reach I have become more and more conscious about one thing: With HelloBody, I have a great responsibility towards the world in which we operate as a business and as a brand. Especially in the cosmetics industry, there are still many stereotypes and idealized types of beauty to be found. In no way did I want to support this. So I increased the corporate values: body positivity, i.e., a positive attitude towards my own body, and female empowerment, which meant the worldwide support of women, quality, and fun. Because I’m an entrepreneur, I have influence. I can make a positive contribution! That is my goal for HelloBody and that’s what’s rooted deep within its DNA.
What is your product strategy and formulation philosophy?
One of our core values of course is the quality of our products. All of our products are dermatologically tested by an independent German institute—the Dermatest Institute—and all received an “excellent” rating.
The earth’s ecosystem can be described as a complex organism in which different cycles interlock to create a stable system. People must integrate themselves responsibly if this stability is to be maintained—and that goes for us as a company, too. That’s why mindful and responsible interaction with people, animals, yeah, and the environment, is the basis for all our decisions. The best natural ingredients are the signature of our treatment range, because of their exceptional benefits for skin and hair. On each of our product pages, you’ll be able to discover, in detail, their benefits for your skin.
All of our products are made in Germany and we measure the ingredients of natural origin according to strict industry standards. Our goal is to reach 100% ingredients of natural origin in our products. Currently, the average percentage of natural ingredients in our formulas is 98%—this small difference is necessary to ensure the sensorial qualities and the best preservation of the formulas. Because we want only the best for the skin and the environment, we refuse to use the following in our products: parabens, sulfates, microplastics, and aluminum. We do not resort to irritating ingredients such as denatured alcohol, or mineral oils and waxes, whose benefits on the skin are low. We attach great importance to making our product packaging more and more sustainable. And we constantly work to implement our plans to be increasingly sustainable.
A DTC brand that was launched just four years ago, scaling to 65 million euros in revenue while reaching profitability in the first year, is impressive. Can you share your secret sauce?
The unique brand and product positioning of HelloBody is one of the key elements. Authenticity is a major reason for consumers to like or dislike brands. This unique positioning builds the base for this new generation of DTC brands: profitable business model and the demonstrated scalability across channels, products, and international regions. From day one we have had a conservative mindset about money spending, and we have analyzed every piece of data we have generated. With this mindset we have until today executed more than 50,000 social media-led marketing campaigns and sent over three million parcels with products throughout Europe and the US.
Your marketing mix is similar to most DTC beauty brands consisting of social media, influencer, content, and community. However, one distinct difference is that as you have expanded across Europe and the US, you have established market-specific teams to run the marketing activities and build the social channels and communities. What informed this strategy and what role has it played in your success?
We have established this DTC strategy to be a very efficient channel to reach our target consumer group. However, markets and market dynamics in Europe are different from region to region. Just two of the examples are different consumer behavior or competitive environments. Since it is important for us to have a trustful relationship with our consumers, it has proven crucial to be able to understand their individual needs. One of the elements of this strategy is to be able to communicate in their native languages.
You launched the brand in 2016 scaling across Europe, and made the decision in 2018 to allocate budget and expand into the US building an infrastructure and team. Why did you decide to establish your team in LA over NYC?
Many trends in the industry come out of California in general and Los Angeles specifically. Los Angeles is an incredibly diverse city and it is home to a healthy way of living. It is a great place to be and benefit from for a conscious and holistic beauty brand such as HelloBody.
Are there any significant differences between the US and European markets that you’ve experienced?
There are many differences between all markets that vary in micro- or macroeconomic developments. In our D2C way of approaching the market, there is no such thing as a “Europea”’ market. Germany differs from Italy just as much as it differs from the US.
Would you consider a move towards traditional retail expansion?
I believe our products look as nice on a shelf as they do in our beautiful pink shipping parcels. However, the agility, the adaptability, and the resilience of our DTC model have once again been confirmed over the last few weeks. Retail is something we might be eying towards at some point when we see how the future will evolve.
What is the next market you have your sights on?
I believe HelloBody has the potential to become a global player. Our model gives us the backbone to tap into quite a few more untapped areas in Europe. There is a lot of potential still to be explored in the US. And thinking further globally, I can think of quite a few further promising regions.
We are doing this interview in what will prove to be a defining period in people’s lives and in business. How has the coronavirus pandemic impacted your business? On the other side of this, what do you think the new normal will look like?
HelloBody is affected in very similar ways as other DTC brands. Since we are producing our products in Germany, we are in the lucky situation that our supply chain has not been affected. However, we have of course taken a conscious effort to secure health and safety for all people involved: Globally we started to work from home already by mid-March. Our production sites and warehouses have been prepared and equipped with further shifts, more process time, and increased security distance and hygiene measurements. We have donated close to $150,000 to numerous charity organizations for their fight against the coronavirus. Consciousness is the core of our DNA and of course this also shows during the current crisis.
Is there anything else you’d like to add?
During the COVID-19 crisis, we really want to support those in need, so we have set up donation campaigns to support those who have been affected by this situation. We have chosen to donate $1 of every order to No Kid Hungry for the entire month of May.
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