Transcript
+
The subscription business model that disruped the cosmetics industry
Romy Gingras, Caitlin Todd, Lisa Troy, Mia VollanDarpan Agarwal Borislav Blagoev, Darko Smilevski
+
AGENDA• INTRODUCTION• BUSINESS MODEL• COMPETITIVE STRUCTURE• VALUE CHAIN• HOW THEY USE I.T.• INTERNET MARKETING• CHANGING INDUSTRY STRUCTURE• CONCLUSION
WHAT IS BIRCHBOX ?
+BIRCHBOX DEVELOPMENT
2010 : Birchbox launched with 1,200 subscribers, 20 brand partners, and 6 employees
2012 : Birchbox for Men
2014 : Store opening in NYC & Washington D.C.
2015 : Over 1 Million subscribers, 800 brand partners, 600 employees in six countries
Valued at $ 485M with $ 71.9M raised.
+BUSINESS MODEL Key Partners Brands
Key activitiesCurating and creating relevant beauty boxes targeted for each consumers
Value propositionHelp customers to discover and try the best new beauty products from the comfort of their homes
Customer relationships• High level of
customization • Strong community
built on social media• Reward system
Customer segments • Women who enjoy
beauty products but don't want to work too hard to find them
• Men aged 25-35 who are willing to try new things in regards to their shaving routine, hair, and skincare
Key resources• Partnerships with
brands • Beauty knowledge• Customer data
Channels• Mailbox• Website • Social media• Brick-and-Mortar
Stores
Cost Structure• Logistics • Technology • Marketing • COGS• Labour & HQ
Revenue Streams (Estimated in 2015 $170M a year)
• Subscription fees • Online Sales (30%)
+COMPETITIVE STRUCTURE
Five forces analysis:
Buyer PowerLow
Threat of Substitution
High
Threat of New EntryHigh
Supplier PowerLow
Competitive RivalryHigh
+Direct Competitors
GLOSSYBOX
BEAUTY ARMY
IPSY
+Value Chain
+Primary Activities
Operations
Outbound
Logistics
Marketing &
Sales
Service
Inbound Logistics
• Selected Samples• Outsourcing of
Packaging• Free
Samples/partnership
• Inventory Wholesale
• Outsourcing of distribution
• E-commerce Platform
• Targeted samples• Surprise effect• Product category• Discount points• Feedbacks
• Editorialized description
• Tutorials
+How they use IT
Push Communication
Customer Satisfaction Conversion Rate
Optimization Problem
+Internet Marketing” Starting with the content will reward you as you grow, as well as later on. “
+E-mail Marketing
Still one of the most important lead sources.
• Follow up emails“We forgot something in your February box” • Sense of urgency
“HURRY!” “SAVE TO DAY!” “LIMITED NUMBER”
Holidays/seasons Rating Customer purchasing journey
+Affiliate Marketing
Commission when they generate a sale
Outsource Pros and cons
+Website development
Inverted news writing pyramid Informal tone Videos Personal profileIts likable, sweet, demonstrative, simple and focuses on content.
+Social Medias
Content created for Social Medias Tailor to each platform Tutorial videos
Influencers• Instagram takeovers Birchbox points
+Changing Industry Structure for Cosmetics
PAST
PRES
ENT
FUTU
RE-Limited options for
retailers
-Trends driven by
celebrities
-Internet used only
in the marketing
strategy
- Bloggers and trendsetters play an important role
- E-commerce as another way to reach customers
- Customization and recommendation software
- Omni-channel retailing
- Innovation through technology for engaging client
- Blurring borders to reach new markets
+Thank you for
listening !
top related