Gen-Z beauty brands are growing up

When the InnBeauty Project launched in November 2019, it was one of the first beauty lines to market itself exclusively to Gen-Z.

Although the founders, beauty veterans Alisa Metzger and Jen Shane, fell squarely into the Millennial demographic, they brought to their brand an unapologetic, more-is-more aesthetic and a reasonable price point meant to appeal to customers under 20. Products like Face Glaze, a highlighting cream, and Slushy, a moisturizing serum, packaged in neon green and yellow, emphasized a sense of playfulness for under $30 a bottle.

What was relatively new in 2019 is mainstream now. InnBeauty struck a deal to sell at Sephora in April 2021. On Tuesday, the brand announced a $12 million Series B funding round led by Alliance Consumer Growth. And the InnBeauty Project is hardly the only Gen-Z beauty brand to catch the eye. Last month, Topicals, a chronic skin care brand, closed a $10 million round led by Cavu Consumer Partners. In January 2022, Oddity Tech, the parent company of color cosmetics line Il Makiage and its new Gen-Z beauty and wellness brand SpoiledChild, closed a $130 million round, valuing the company at $1.5 billion. Less Gen-Z-focused brands are also raising money: grooming brand Frontman and Experiment Beauty, a sustainable beauty line known for its reusable sheet mask, raised $1.2 million and $1 million, respectively, earlier this year.

InnBeauty will use its capital to create a larger footprint in Sephora and expand into Sephora Canada. Topicals is also focused on international retail, with a focus on Africa.

These brands are gaining traction by doing the opposite of their millennial-focused predecessors. In the 2010s, direct selling was the future; now, brands are vying for space at a major retailer within a year or two of hitting the market — if they don’t launch with one in the first place. Where Glossier’s white boxes and sans-serif font made its website and stores feel almost unattainably cool, the bright, bold packaging of Gen-Z brands is designed to pop on Sephora’s Next Big Thing wall.

“I think what made early Gen-Z direct-to-consumer brands successful is that they knew consumers didn’t want the millennial, hyper-minimalism that was devoid of emotion,” said Larry Milstein, co-founder of next-gen marketing agency Przm. “Consumers wanted brands that had a strong perspective, that emphasized the community and the people behind it, not a hero product.”

An energetic, imperfect aesthetic

Faded, a dark spot and discoloration serum sold by Topicals, has a pink, toothpaste-like tube accented with reds and lighter pinks, while High Roller, an ingrown hair treatment, comes in a light blue bottle with orange lettering. Models are people of color, who happily show off their dark spots along with electric blue eyeliner and glossy lips.

Olowe, 26, is on the edge of Gen-Z. But Topical’s idea is to stand out in a crowded skin care market, a message that aligns with the brand’s mission to address skin care concerns once reserved for the dermatologist’s office.

“I never wanted to be a trendy brand … I hunt for what the customer wants,” Olowe said. “We create trends … when we look back at skin care, people will say that the industry is different because of Topicals.”

Bucking the trend is becoming a trend in itself: new brands are coming up with their spin on the “imperfect” aesthetic to capture consumers’ attention.

Insanely Clean, a Gen-Z skincare brand aimed at men that launched on Nov. 30, features bright blue branding and squiggly italics in the hopes it will resonate with young customers. SpoiledChild’s multicolored, metallic hair and skin care jars look like pills.

But as more brands opt for neon green or bubble letters, the question is whether they can also keep customers’ attention. Brands like Topicals, founded in 2020 and therefore a relative veteran in the industry, have an advantage.

“More than any previous generation, the Gen-Z trend cycle is so much more accelerated, where something that was trendy six months ago or three months ago has quickly become ubiquitous, discussed and unpacked. The risk to business is that if you base the whole “your visual identity around what’s popular now, like early cyber nostalgia or Y2K, can seem very dated, very quickly,” Milstein said.

Insanely clean products.

Deployment of capital

As Gen-Z beauty moves from niche to the norm, brands are using investment dollars to strengthen their positions in the market.

The InnBeauty Project’s latest fundraiser will be used to raise awareness in Sephora stores as well as fuel an expansion of Sephora Canada. Sampling will be a key component: the brand aims to distribute 400,000 samples of its 10+10 moisturizer, Green Machine serum and Retinol Remix into the hands of Sephora and its own website customers next year, Metzger said. The company also plans to hire talent to lead the Sephora business and transform the e-commerce site into an education-focused digital headquarters.

But as higher gas prices and mortgage rates leave consumers with little room for non-essentials, the InnBeauty Project uses sampling to emphasize its value proposition.

“We know there’s less disposable income,” Metzger said. “We’re seeing a lot of commerce where people may be loyal to something that’s core to their routine, but want to explore new products like retinol at a more reasonable price point.”

Focused on international expansion, Topicals plans to sample and sell products at Afrochella, an event in Ghana focused on African entrepreneurs and creatives, later this month. Olowe is the daughter of Nigerian immigrants. It also plans to spend more on larger inventory orders to support existing products and new launches.

“We’ve been selling out since we launched,” Olowe said. “Selling out is really sweet when you’re a fashion brand and can manipulate the price, but for a beauty brand, we only make money when we sell a product.”

Moving past Gen-Z

SpoiledChild launched in February with 17 products, including an F38+ Anti-Aging Retin + Night Rewind Serum, $69, and S33+ Anti-Aging Collagen Burst Serum, $59, which might seem out of place for a brand aimed primarily at wrinkle-free teenagers.

The brand is built around the idea of ​​”preventive beauty,” said Suzanne Fitzpatrick, co-general manager, emphasizing “age control.” The site features the slogans “age is an old idea” and “mature in reverse.”

The message is designed to insulate the brand from ever-evolving TikTok trends and changes in consumer preferences.

Several Gen-Z beauty brands are expanding beyond their original customer base. The InnBeauty Project launched its Retinol Remix in May. Although the brand prides itself on affordability, the product retails for $48 — a price point better suited for slightly older Sephora customers. Metzger said InnBeauty’s biggest demographic is 18 to 35-year-olds, spanning the Gen-Z and Millennial generations.

“When we first started, we were that Gen-Z brand … but the Sephora consumer is in their late 20s to 40s,” she said.

Olowe argues that Gen-Z has less to do with age than mindset. The brand underwent a refresh in August to have more mature skin in its marketing.

“Gen-Z doesn’t mean you’re a specific age. You’re someone who believes that skincare is a journey and your routine is constantly evolving,” she said. “We don’t have to be everything to everyone, but we have to be everything to our customers.”

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