Hitting 100x revenue growth over a year is major for any company — but especially so for beauty brand Allies of Skin, which shifted its focus during 2020 to center less on their retail partners and more on their Direct-to-Consumer (DTC) strategy.
Founder Nicolas Travis launched Allies of Skin in 2016 as a result of his own negative experiences with the existing products available to treat his severe acne concerns. The Singapore skincare brand was born with a simple goal: to create smart, effective products for the modern-day multi-hyphenate.
Like many other fast-growing businesses and startups, Allies of Skin’s main challenge was figuring out what kind of resources they needed to succeed online and secure more DTC sales.
“The big issue was figuring out how to grow our direct to consumer business. When we started, our company was mostly centered around our retail partners around the world. Back then, 80% of our sales were coming from retail partners and 20% from our DTC channel. That was a big reliance on external channels which can always be a risk as a brand”, shares Travis.
Today about 35% of Allies of Skin’s revenue comes directly from direct sales on https://alliesofskin.com/ and 65% from their retail partners. At the end of November 2020, the brand passed a new milestone as it was the first time when their DTC sales doubled their other sales channels.
Crucially, this hasn’t come at the cost of taking users away from existing acquisition channels like wholesale partners. In fact, it has helped grow B2B and offline revenue sales because their paid marketing efforts continuously reach a wider audience that Allies of Skin wouldn’t typically market to.
Allies of Skin’s accelerated growth
In 2019, Travis discovered one of the big issues with running a paid marketing strategy that works: it requires not only an ever-growing budget but also demands full attention from an expert team. If you want results, you need to invest in your paid growth budget, choose the right channels for your brand and constantly review your action plan.
“We had good products, we had the social media to communicate with our audience, but figuring out how to optimize campaigns for each channel (Facebook, Instagram and others) was a challenge for us and we really didn’t want to focus our team on that”, says Travis.
Until November 2019, Allies of Skin didn’t have a dedicated investment and growth partner to operate its digital channels. But during the holiday season of 2019 Allies of Skin teamed up with DRVE to work on their paid growth strategy and drive more online sales.
As their business ballooned after that holiday season; their executive team was looking to continue the growth with a partner that would help them expand into new markets and grow their DTC sales even further.
“We’re really glad we met DRVE. At this moment, we have 100 times increased revenue between December 2019 and December 2020. So that means that for the past year working together we have all been doing something that’s right. Working with DRVE has allowed us to focus on what we are good at which is crucial as a startup because as a small company we have limited hours per day and a limited amount of people in our team. This partnership allows us to do what we do best and leave the rest to people who are experts in performance marketing”.
One key factor that shaped their online revenue growth was increasing its budget to work with influencers. For any small company, influencer marketing is a costly strategy with results that are hard to measure therefore having an investment and growth partner to lead the way is a big win for ecommerce startups.
As Travis puts it: “For us, this year was the first year we had the luxury to invest in influencer marketing. It was the first time we could see how our product interacted with their communities, allowing us to estimate how much sales we can drive from this channel. In addition, the data collection you get from influencer marketing is crucial and being able to do that as a small company was a game changer.”
While influencer marketing is a well-known strategy and it can amplify a brand when used properly, companies should be aware that this type of social media endorsement will only work if the company also builds up the right amount of trust with other efforts. Influencer marketing is not a stand-alone approach but it can deliver outstanding results when the company also dedicates a significant amount of resources to product, design, traditional marketing, sales and other operations efforts.
The next phase of growth
Allies of Skin’ original sales strategy was to get the best retailers worldwide to sell their products in different markets. But after a quick surge in online sales and retail relationships with giants like Sephora and Douglas, the global pandemic had other plans.
“Due to the COVID19 and the global lockdown we realized we needed to shift our focus and reconsider our sales strategy. In a time when people don’t leave the house to buy, especially if they can’t test products in a store, there is a clear change in shopping habits. When we saw people were shifting towards buying everything online, we realized we also needed to review our sales process”.
Now their next phase of growth is balancing their main sales channels. Travis observes that the goal is “to get a split of 50% DTC, 50% sales partners channels. That’s a healthy baseline.”
Because of the pandemic, Allies of Skin not only started to focus more on direct sales but the brand had to also change a lot of its plans to avoid inventory constraints thanks to the higher demand.
“For instance, we produced 5000 units of one of our products and we thought that would last, based on historical data, for around three months. It turns out, we sold 3000 units in 5 weeks. So that sums up one of our biggest challenges: realigning our production and ensuring we have enough stock”.
These types of disruptions to the ecommerce industry were a very common side effect of 2020’s increase in DTC sales. For Allies of Skin, the key to deal with this struggle was to increase production and “work hard to minimize all types of pain points”.
The brand kicked off 2021 focused on what they do best: create stellar formulations that solve the problems and pain points of their customers. Even if beauty is a multibillion-dollar business dominated by the likes of giants like L’Oreal, Shiseido, Estée Lauder and LVMH, Allies of Skin has managed to grow into a successful global brand. With a very high retention rate (around 85%) among their loyal customers and a growing base of fans in new markets, the Singapore-based company continues to take their high-quality products to the next level.
Allies of Skin’s best-sellers
“We don’t really have a hero product because all our products sell very well, but if I were to pick, our serums are some of our customers’ favorites. For instance, the mandelic serum is one of our top sellers”, confirms Travis.
According to the retail marketing technology company Bluecore, beauty was the category that saw the biggest increase for year-over-year online growth during both Black Friday and Cyber Monday. For Allies of Skin, the top three best-selling products during the 2020 holiday season were the Daily Treatment, the Overnight Mask and the Night Serum.
A daily leave-on treatment (pH 5.0-5.4) supercharged with multiple peptides, 7 Brighteners, 9 Antioxidants and a 16.5% Repair Complex to firm and repair all skin types and conditions. It reduces all signs of premature aging. Fat-soluble Vitamin C, Teprenone, and Palmitoyl Tripeptide-5 reduce the appearance of imperfections, large pores, and wrinkles. With daily use, the health of the skin is enhanced, for visible resilience, radiance and firmness.
Supercharged with a time-release 0.05% Retinaldehyde, 13.5% Peptide Complex, 9 Antioxidants, & 5 Brighteners, this multitasking overnight mask hydrates and brightens stressed-out skin, while reducing signs of premature ageing. It offers all the reparative and renewing properties of Retinol without any of the traditional irritation.
This next-generation overnight serum (pH 3.5) is supercharged with a hardworking blend of 11% Mandelic, Lactic + Salicylic Acid, 1% Bakuchiol, 8 Brighteners, and 7 Antioxidants and Peptides, that reduces the appearance of stubborn dullness and discoloration for brighter, even-toned skin. Reduces the appearance of wrinkles and fine lines, whilst improving skin’s elastic feel.