Our free on-demand webinar, “Beauty x Omnichannel”—sponsored by Oracle + NetSuite and now available for on-demand viewing—generated a range of audience follow-up questions. Our editors consulted with industry experts to gather answers and provide some resources for further research.
Q: Is there a way for any agencies to actually create a consumer segmentation based on different kinds of cohorts a brand may want to target?
A: There are a number of agencies that focus on generational marketing or strategies centered on specific lifestyles, regions, income brackets, etc. While Global Cosmetic Industry does not endorse specific agencies, it would benefit a brand to explore working with groups that specialize in the cohorts you want or which have had success with brands targeting your desired consumer segment.
Q: Since there are so many influencer agencies now in the market, do you have recommendations on which ones to work with?
A: Brands we’ve spoken with are of two minds regarding influencer partnerships. Some hire an agency to help speed up the process of onboarding and managing influencers. There are many examples of agencies, including HireInfluence, Get Engaged, Viral Nation, 6Degrees, etc.* These groups offer the services of beauty-specific and lifestyle influencers, alike.
Other brands focus on developing paid and unpaid influencer programs via internal social media teams. As algorithm changes across social media platforms continue to make organic reach difficult to achieve, these brands have found that creating large, fragmented networks of micro influencers have created the best reach. Many of these have been achieved without the aid of an agency.
Whether a brand ultimately works with an agency is dependent upon its goals and the resources it is able to devote internally. In addition, the quality of an agency is just one element to be considered; so too is the quality of the influencers—both macro and micro.
We also received a comment asking about a recent study from GVG Digital, a “digital transformation group” founded by retail guru Love Goel, which suggests that multi-company retail is the future, while omnichannel strategies have yet to create “Amazon-beating” companies.
The report, which can be found here, argues that “only four traditional companies have ever beaten Amazon in a large digital market and unlocked billions of dollars in shareholder value.” Among those is B2W Digital, the e-commerce affiliate of Brazilian retailer Lojas Americanas.
Lojas Americanas’ strategy centered on spinning off its e-commerce activities into a separate company, B2W, of which it owns a 60% share. (The remaining shares are in the hands of public investors.) The retailers operate as separate companies with different boards and teams and limited overlap of brands, inventory and customers.
Further reading: How Do You Beat Amazon? Go Low ... and High.
The specialization of the two groups allows them to optimize their operations for the business they’re in—physical or digital retail—a direct affront to the seamless integration of omnichannel. GVG Digital calls this the “multi-company” strategy and suggests that it prevents Amazon from using a “retailer’s operating margins against them” in the cutthroat e-commerce world.
The key features of multi-company strategies are a focus on customer experience and growth, as opposed to cost and operations, GVG claims. In multi-company retail, separate companies run stores and e-commerce, respectively, which feature brands, inventory and customer profiles that are distinct from one another.
The report also argues that, ideally, these two companies should not overlap product assortments by more than 15%. Finally, each company should foster their own core teams and be managed by separate boards.
While the report centers on retailers, the GVG analysis provides food for thought for brands. How might this impact brands seeking to succeed in multiple channels? And how might these principles be applied to brands, product assortments, etc.?
While omnichannel concepts rule the day, the analysis certainly offers an interesting counterpoint to prevailing wisdom.
*Mentions of any agency is not an endorsement.