Beauty startups have to compete with well-known legacy brands and one another. They all want to become the world’s next beloved brand and sell in the most sought-after shopping destinations. For many, field and education teams are what it takes to support that goal, especially when it comes to brick-and-mortar businesses.
Startups are famous for their agility and speed, especially in the DTC space, but how do they transition from e-commerce to selling in physical stores with the same speed and reach as their online platforms? How do brands afford to invest in both, and if not, what are they leaving on the table?
The most commonly missed opportunity is sales. Brands that support their brick-and-mortar retail are likely to have 3x more sales volume than brands that don’t.
For example, a brand with 100 doors averaging $500 per door would result in an annual sales volume of $2.6 million. If half of those doors were supported, the average weekly sales would increase threefold, each doing $1500, resulting in $5.2 million annual sales volume — and that’s with only half of those doors being supported.
Additionally, supporting in-store sales proves that those products are desirable and will sell at volume. In response, buyers will expand distribution or provide more space within the same stores, such as an additional end cap or a unit at the cash-wrap area.
“Too often, I hear brands say that they don’t need in-store support,” said Paula Floyd, CEO and founder at Headkount. “They say that their productivity is high or that they’re investing online, which is the right thing to do, but this is exactly why it’s the perfect time to invest in retail and a field team to build on the momentum. At some point, your sales will slow down, and your productivity will decline because your competitor, who has a team, will catch up. Sadly, I see this all too often.”
Build an in-house sales force — or leverage a freelance model
Building an in-house team is challenging but rewarding. The approach takes time — often years — and requires a formidable number of in-house resources to support a nationwide field team.
To start, the departments a company needs in place to support a field organization include sales, education, human resources, accounting, payroll, benefits and legal.
The first hire should be the head of sales and education. This person must have significant experience in the beauty industry, numerous retailer relationships, and the know-how to lead and inspire people. Success typically follows hiring someone who has been in the field before and knows what a high-performing team looks like; not only will they understand the roles and what to look for, but they will have instant credibility among the team they are seeking to attract.
After that, brands must determine what markets are best to support, identifying markets with the most clusters of stores and sales volume to cover more stores with the least amount of effort and fewer costs on travel and expenses.
A freelance model takes less time and money than building an in-house team, but it still requires some internal resources to support that team. Online groups such as Cosmetic Peeps or similar sites can help companies develop a freelance base. Again, hiring candidates with experience in the industry and proven relationships with retailers is critical.
Another thing some companies may need to consider with a freelance model is regional legislation, such as California’s freelance law. While these may not affect everyone, it is essential to keep in mind that some states have specific requirements around who can and cannot be designated as freelance workers, which may affect the model a company chooses.
Outsource a field sales and education team
Hiring an outsourced team allows companies to scale nationally with speed, flexibility and zero liability. A fully-trained beauty-educator team with existing in-store retailer relationships can engage with customers on day one, helping a brand get into stores within eight weeks nationally.
Given today’s climate, this is highly advantageous. If pandemic restrictions require the scaling back of resources, for example, rather than massive layoffs for an in-house team, there’s simply a pause on the contract with the outsourcing company.
For brands looking to explore this option further, it’s a good idea to ask retailers or other brand founders if they have worked with any outsourcing companies they can recommend. From there, the team can check out what brands that company represents and set up an exploratory call to see if they could be a good fit.
Beauty brands should ask for referrals and connect with some of the prospect’s current clients to understand how they collaborate and what it’s like to work with them from the brand side of things. The point is to ensure that goals are aligned and that the team understands the brand.
“What’s predictable today is that the consumer is walking into the store eager to buy,” said Floyd at Headkount. “Conversion rates are at an all-time high. For brands serious about retail, it’s time to invest, show up for your customer, attract new ones and get your field and education team up and running, no matter which model you utilize for your brand.”
Despite the unpredictable times, many brands are having record years, and field and education teams are helping them continue to be successful in 2022.
Sponsored By: Headkount