Sweet Tarte: Taking Inside-Out Beauty to Heart

Back to the October issue.

Maureen Kelly arrives at a Midtown Manhattan restaurant for a scheduled interview, glowing and wearing a smile that should be protected by trademark or other legal device. She quickly reveals that the glow comes in part from her second pregnancy. The rest of it surely comes from her passion for the beauty business and the success of her own growing enterprise. The creator and CEO of tarte cosmetics is having a very busy year, but from the look of things, she thrives on it. Kelly is accompanied by tarte vice president Alexis Mezzina DiResta, who exhibits her own kind of energy, leaving little doubt that this duo is a force to be reckoned with.

The company got its start back in 1999 in Kelly’s one bedroom New York apartment. Its first product, a cheek stain, was designed as an alternative to available stains that Kelly says streaked and were generally difficult to use. The latest-generation cheek stain launched recently, and incorporates some of Kelly’s new thinking in response to trends she feels strongly about: the new stain is all natural and preservative-free. What’s more, the colors come from tarte’s proprietary t-5 super berry antioxidant blend. So, how did tarte grow from its first cheek stain to proprietary blends in just a few years?

Business 101
The number and range of products in the tarte line suggest a passion for product development, an area where Kelly and DiResta make no bones about how their current process differs from the early days. Back in the day, they would find a unique packaging component and decide which product would work best in it. “This actually helped us create some great products in a really organic way,” says DiResta. “It helped us to think outside of the box, which I think is crucial for a young company.” Today, function comes first, starting with selecting a great formula and adding skin-benefiting ingredients. Their focus is on delivering a consistent message about the ingredients they use and matching up a great formula with packaging that DiResta says is chic, user-friendly and visually supports the message they’re trying to send. Kelly elaborates saying they have refined their process over the years to a set of questions relating to new products. The main focus of the questions is whether the packaging is aspirational and fashion forward and whether it is derived from healthy, natural ingredients. The importance of refining their product development process is just one of the important lessons the pair have learned over the years, and not all have been learned on the job.

Both Kelly and DiResta acknowledge the influence of some important men in their lives on the success of tarte. Kelly cites her husband, who, despite being educated at a top business school and possessing a widely varied business background, believes that humility and being a team player are the most important leadership qualities. “He is forever encouraging me to see things from my team’s point of view and to be a good listener, so I have multiple opinions before I make a decision,” she says.

DiResta gets her passion for work, and for marketing in particular, from her dad, and says they both enjoy analyzing the DNA of a brand. But the most important lesson she’s learned from her father echoes the guidance given by Kelly’s husband. “He just has an innate sense of fairness, and was always putting the well-being of the company and the employees before his own,” she says.

DiResta says people remember her father because he listens to what they have to say and truly takes their opinions to heart. “As a manager, I really try to emulate him in that respect.” DiResta is grateful to Kelly, too, for insisting she attend a broad range of meetings, including PR and product development, from the moment she joined tarte in the very early days of the organization.
For her part, Kelly has learned that business owners are only as good as the people they bring on board. “It’s so important to hire people that complement your weaknesses,” she says, “and believe me I have many!” Believe what you will about that, but also consider that she has also learned a thing or two about the power of giving back. “We’ve upped the ante every year since we launched, and I’m so proud of our partnership with Habitat for Humanity over the past few years,” says Kelly. “Last year we donated our holiday budget to help finance a new home for an underprivileged single mother, and my team all participated in the actual build.”

Whether pounding nails for Habitat for Humanity or hammering out the next year’s business plan, building is something Kelly and DiResta seem to be pretty good at. The occasional figurative crooked tile or paint drip can be chalked up to learning and preparation for the next challenge. Neither one spends time on regrets, nor are they looking for any “do overs.” DiResta says when you have no choice but to figure something out on your own, you do it—and that can be empowering. Kelly has learned from her mistakes and believes they make her a more effective manager. But judging from all the media attention the young company has been getting, successes have outweighed mistakes by a wide margin.

Rewarding Experience
Recognition comes in many forms, and over the years, tarte has tallied up an impressive array of awards. The cheek stains and tinted moisturizers have garnered their share of praise, including “cutest packaging” from Shape magazine, and earlier this year, a new lip product, fRXtion, took home a Cosmetic Innovators of the Year (CITY) Award for Color Cosmetics Package Design from ICMAD.

There’s been no shortage of kudos for the products themselves, and now they are getting recognition of another kind. As this issue of GCI magazine was wrapping up, word came of the kind of notice that speaks to business growth and dynamism. When Inc. magazine published its Inc. 5000 list of fastest growing private companies, tarte was listed as number 994. According to the report, tarte has enjoyed 354.3% growth and posted 2006 revenues of $5.7 million. The whole beauty inside and out notion figured into this recognition. In citing what they found noteworthy about tarte, the list makers said, “A trainer comes in twice a week to help employees stay healthy and keep fit. Inc.’s findings suggest that the company is growing because trendy packaging and lots of all natural ingredients win customers.” It just so happens that the importance of natural ingredients is on Kelly’s short list of key trends.

 “Naturals and the whole green movement is a huge trend, and one I believe is here to stay,” she says. “Fortunately for us, we’ve been focusing on natural ingredients from the start.” DiResta says they are ahead of the curve on this one, and are “keeping pace” with their original plan. Sephora was amazed by their ingredient story, and encouraged them to share that information with its customers. “Now, we’re shouting it from the rooftops—or at least from our unit cartons, Web site and gondolas,” says Kelly. “Every one of our products has [our trademarked] skinvigorating key on the back detailing all of the healthy benefits such as minerals, all natural SPF, vitamins, whether it’s dermatologist-tested, etc. That way [the consumer] can make an informed decision about what she’s putting on her skin.”

Trademark Chic
tarte’s main focus is making sure that its products are really demonstrative of what it calls health couture, a trademarked term defined as “fantastic product with great skin-caring ingredients in chic, fashion-inspired packaging.” DiResta and Kelly are adamant that what consumers put on their skin must enhance their natural beauty and actually deliver ingredients that work.

Naturals topped DiResta’s trend list, too, but she rounded hers out with education and finding inspiration in the past. Customers want to know more about the products they buy and she credits that need to know with the success of distribution channels such as QVC. Customers now learn about brands straight from the creators. “I think we’ll just be seeing a huge proliferation of information in the coming years—more detailed Web sites, online videos, more ‘magalog’ type catalogs,” she said. She believes customers will continue to align their personal philosophies with those of a brand.

For DiResta, finding inspiration in the past translates into digging into the beauty archives. Companies with rich, long brand histories, she says, are looking to the past for inspiration to further build up their brands. Newer companies are giving a nod to the past by reinventing classic products, best seen in what she calls the re-emergence of lipstick: better formulas, better packaging, but still the ultimate iconic beauty product.

Multichannel distribution rounds out Kelly’s top trends. Traditional department stores are losing some of their luster, and with mass-market beauty companies putting out more innovative products, CVS and other pharmacies will grow in appeal. Home shopping channels, infomercials and the Internet have also grown in importance.

A focus on ingredients in general and actives in particular also made the list of powerful trends, and Kelly isn’t just giving lip service to ingredients. She recently partnered up with pal Scott Vincent Borba, creator of the eponymous line of drinkable skin care, to send a message to her customers that she is serious about beauty from the inside out, and tarte has capitalized on Borba’s investment in research and testing of nutraceuticals. tarte’s latest lip gloss offering, Inside Out, includes natural ingredients from BORBA’s Age Defying, Replenishing and Clarifying lines, aimed at diminishing the appearance of fine lines and wrinkles while helping to protect against environmental attack. When Kelly says “your makeup should be working for you,” she means it. DiResta believes the association works because both BORBA and tarte are crossover lines that “manage to capitalize on aspects of the zeitgeist while still remaining current by virtue of their high-quality products.”

“Maureen and Scott Vincent have a very natural partnership, too,” says DiResta. “They are both so passionate about their businesses and about creating products that will really benefit the customer, but they are also very easygoing, laid-back personalities, so working together has been a lot of fun.”

And the move is paying off. Lip gloss sales are up 90% and garnering heavy coverage from beauty, fashion and lifestyle magazines—including Allure, Vogue, In Style, Elle, Marie Claire, Self, Shape and Health. The new glosses were featured on the Today show and the Rachael Ray Show. “We’re even adding three new shades for the holiday season per customer request … or should I say demand,” quips Kelly. “Our customers can be pretty feisty.”

Good to the Core
The desire to produce products that benefit the consumer is part of what makes this the right time for nutraceuticals. “Nutraceuticals are natural, bioactive chemical compounds that have health promoting, disease preventing or medicinal properties. There has been so much research devoted to discovering what various food products have to offer in keeping us healthy and beautiful. Feeding your skin by topical application is something that has been done for thousands of years by various cultures,” says Kelly.

Kelly and DiResta agree that today’s savvy consumer is demanding more from the food she eats and the products she uses on her face and body, and that nutraceuticals offer a natural way to fight the onslaught from free radicals and pollution. “With the proliferation of information about environmental and health concerns as well as beauty blogs, TV shows and magazines that translate what was once industry jargon into laymen’s terms, women are demanding more from their beauty products,” says DiResta. “It’s no longer enough to create a lipstick that makes you look pretty—it needs to make you look good, feel good, and, hopefully, be good for you, too. As a result, healthy beauty and environmentally friendly beauty have become huge trends.”

Next up, tarte is launching an antiaging, natural lipstick with a BORBA nutraceutical core—it’s the first ever lipstick, according to the company, that will nourish, moisturize and rejuvenate lips while helping to protect against environmental attack. It’s preservative-free and chock full of vitamins and natural extracts such as grapeseed, chamomile, acai, green tea and lychee.
And tarte products seem to be resonating with customers. “We’re sort of in our own little sphere, with the cool products now combined with naturals,” says DiResta. “What Stella McCartney did for skin care, we’re doing for makeup.”

DiResta believes the Inside Out vitamin-infused lipgloss was the first product that helped customers connect with the “skinvigorating beauty” message. “We got a tremendous positive response on our Web site,” she said, “and ultimately, the proof is in the pudding—the sales on the lipgloss were and continue to be fantastic. Our customers are giving us great feedback.”

Instant Feedback
Much of tarte’s customer feedback comes through its Web site. Kelly believes the Internet levels the playing field by helping brands reach customers outside normal distribution channels. It helps tarte to gain valuable instant feedback about its products while providing a platform for educating customers about brand initiatives.

DiResta is less restrained in her appraisal: “The impact of the Internet has been colossal. It basically seeps into nearly every area of business and culture these days.” She points out the sheer volume of online information available to businesses and customers alike, making it difficult to know where to begin. A key development is the growth of a whole new way to comparison shop. It requires that companies step up their e-tailing game, says DiResta, adding promotions and features to build brand loyalty.

Beyond Web sites are blogs, Web communities, Wikipedia and more, putting all kinds of information at consumers’ fingertips. “Depending on where they’re finding their information, this translates to either a more educated or a more confused consumer,” says DiResta. “So beauty companies have a responsibility to tell the product story they want to tell on their own Web sites and in their retail merchandising.”

DiResta’s experience predates the blog craze, dating back to the early online makeup communities. She believes that beauty brands can’t underestimate the unfiltered feedback found on blogs and online communities. “At tarte, we welcome that kind of feedback—that’s really what helps you take your products to the next level,” says DiResta. Many bloggers develop loyal readers who trust them because they know that in most cases the writers aren’t catering to advertisers. In that way, she says, the bloggers are brand ambassadors.

Ever Higher
Even with all the awards and financial success, Kelly isn’t one to rest on her laurels, to relax and say, “We’ve made it.” She works every day to raise the bar, pushing things to the next level. Her days have been pretty hectic, as they focus on tarte’s multichannel strategy, working nonstop with QVC and Sephora. “With all of the wonderful new natural offerings and advanced technology, there is always room for improvement,” says Kelly. “It did help, however, when Oprah Winfrey chose our lipgloss for her O list—I’d be lying if I said I didn’t do a little dance when that issue came out!”

It seems as though there is no shortage of things to dance about: she’s giving new meaning to living the inside and out beauty notion, but the new baby isn’t the only thing on Kelly’s calendar for 2008. She and DiResta also look forward to expanding tarte’s natural product offering and to taking the brand global.

Back to the October issue.

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