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0:00:06 - Brian Becker
All right, what's up everybody? Welcome back to why Brands Work. I am here with my co-founder, Will. How's it going, Will? 

0:00:13 - Will Evans
What's up? 

0:00:14 - Brian Becker
All right, we're jumping into another brand today, going to explore elf, a huge brand in the cosmetics, beauty, skincare industry. Lots of really interesting stuff to talk about, doing over a billion dollars in revenue every year, $5 billion market cap something really, really cool to look into and see what they're doing and how they're making this work. Why does this brand work? Let's jump in and take a look and just as a reminder, so we're going to be going through so many resources. Today we're going to be talking about stuff. This is best listened to while also watching the video. So if you're listening to this as a podcast, yes, you're going to get a lot of value out of this, but just remember as well, there's a full video recording this entire thing and we're going to be showing you examples. There's slides that go along with it. There's going to be a full funnel breakdown. 

We have hundreds of emails from Elf as well. We do a full audit of their entire site and there's going to be just a lot of value stuff we pull up. You know, as the conversation goes on, we go to their social media or we go to their website and we look through different things, and so if you really want to get the full experience, I'd recommend watching this on YouTube or going and grabbing the video recording from our website, and all of that can be found at FlowCandycom backslash elf and you'll be able to access that at any point. And just as a reminder, so you know, brian, I'm Brian and Will is my co-founder. We're both from Flow Candy. We're an e-commerce marketing, email marketing agency that services people using Shopify and Klaviyo. So if you have any needs, any questions, want to jump in and talk about that. We're always available to do this kind of stuff, so just let us know and we'll get you set up. 

0:01:48 - Will Evans
But let's jump into Elf. Yeah, okay, where do? 

0:01:58 - Brian Becker
we begin, so we'll just start at the top. This is about a 20 plus year old business, yep. 

0:01:59 - Will Evans
Founded in 2004. Three guys, three guys right Two NYU students and their dad. 

0:02:05 - Brian Becker
Yep, yep yeah. 

0:02:06 - Will Evans
They had noticed. I don't know if you know the the story behind this they had, they were looking for an opportunity and they noticed that, um, there were no beauty products at the dollar store. That was the original sort of hypothesis theory around it. 

0:02:23 - Brian Becker
Yeah, yeah, and I think that there's. There's, you know, like you said, just people looking for an opportunity, trying to find a gap in the market, which is kind of where a lot of great businesses start of. You know, okay, what is this opportunity? Sometimes it comes from people scratching their own itch and other times it's that identification of like, hey, you know, I see this happening right now why isn't there an opportunity to buy these kind of things at this price point? And since then, you know they've grown hugely. You know, big, big shift in what they were doing, from trying to get into dollar stores into, now, a market cap of almost $5 billion. 

0:03:00 - Will Evans
Yeah, they originally wanted to be only like everything was priced a dollar. 

0:03:04 - Brian Becker
Yeah. 

0:03:05 - Will Evans
They were only going to be like mostly an online store, but now they're actually 88% retail. We're going to dive into all of that. But yeah, I mean right off the bat you said it almost $5 million. This company is literally worth almost $5 billion. It's a publicly traded company and last year they did over a billion dollars in sales and it was up. They were up 77%. 

0:03:30 - Brian Becker
Yeah, yeah, and it's great that. I mean there's a lot of interesting things that they're doing. There's some acquisitions that they're making as well that are that are really cool. You know, alongside already having a huge product line of their cosmetics and their skincare with, you know, like over 300 products, they're expanding internationally now as well, trying to get a lot more presence outside of the US, and one of the best parts is, you know, they're wildly profitable while doing this. 

0:03:59 - Will Evans
Yeah, yeah, a hundred. You don't see this a lot. Even some of these, these, a lot of these DTC brands are famously unprofitable. You're not going to think of like Warby Parker, but these guys that's like. I mean, if they're doing a billion, that's like 12% profit margins, it's pretty good. Um and they. You know, one thing that like really stood out to me was only 339 employees. 

0:04:32 - Brian Becker
Yeah. 

0:04:34 - Will Evans
You know we had talked about. We talk about this a lot like how many employees are there, yeti or no? Yeah, yeti, the previous brand we did, had tripled this, almost 1,000. They were a little bit more in sales like $1.5 billion in sales but tripled the amount of employees. And we were already talking on that episode. We were already talking about how low their headcount was compared to the competition. I mean this is crazy 339 employees, $1 billion in revenue. 

0:05:08 - Brian Becker
And you're typically looking more at thousands of employees for this revenue level. There are people doing hundreds of millions that have 1,500 employees. So doing over a billion and only having 339 is pretty wild. 

0:05:19 - Will Evans
Yeah. 

0:05:20 - Brian Becker
A lot of efficient use of capital there. 

0:05:22 - Will Evans
Yeah, some other things that stood out to me, brian, as I looked at their balance. They have they're sitting on about a hundred million dollars in cash too. 

Um you were talking about acquisitions. So, um, who knows, like, what they're going to do this year? Um, also, they're pouring 24% of their sales back into marketing Interesting. I looked at some stats. I looked at the average company I think would be lucky to put in 10%, 15%, so this is already pretty high. I think L'Oreal that's how you pronounce it really the market leader in terms of just like pure sales in the makeup category. They do about $40 billion, I think, in sales a year and this is like a hundred plus year old company, but they put like 30% in back in. Yeah, I think that there's a lot of focus here on expanding market share. 

0:06:25 - Brian Becker
You know they know how big this industry is. Their products are. You know, as we'll talk about here in a second, average price is about $6. And that means that they need volume. You know you need tons and tons and tons of people buying to really hit the revenue targets that you want to hit there, and so pouring all that money back into marketing makes sense because you're looking for continual expansion and top of funnel awareness. 

I've seen some ads that are in German that have come out of different apparently, like reviews and things that people are saying that we'll talk about a little bit here. So they're really pushing out and trying to expand that audience because they're having a lot of success with that already in terms of social media and just being digital first, and so it's something that I think we're going to see. The game here, now that they've established themselves as a product that is reliable and has a good price point, is actually just going to be market share. How do we get as much of that as possible and continue to grow and then defend that as well? 

0:07:30 - Will Evans
Yeah, they are. I mean, you bring up a good point like how much when the average price is six bucks, how many transactions you need to do to you know scale. 

0:07:44 - Brian Becker
Totally. 

0:07:45 - Will Evans
Yeah, all right, let's move into the positioning here. So this is interesting and I think you know. Something I wanted to bring up is, if you're a guy, if you're a girl that's watching this you, you probably like you you get elf instantly. You understand it, especially if you use makeup. Girl that's watching this, you, you probably like you, you get elf instantly. You understand it, especially if you use makeup. 

A lot of guys listening, including myself at first, was like I don't get it. You know, it just looks like. It just looks like any other makeup brand. It wasn't until I had to, like, really dive into this that I really really understand their like, where their position, what's unique about this product in this brand or their products in this brand? And I think that you know, typically when we break down these brands, or typically when you think of, like D2C, a lot of these people that are trying to build D2C businesses, a lot of them want to move into this higher price, higher quality part of the market, higher price, higher quality part of the market when Elf is. 

And this is interesting because you don't always see this in some of the other categories we've looked at. They are high quality, low price or lower price, mid-low price and just to rip off some stats here, brian and I'll turn it over to you Number one beauty brand for Gen Z, and we're going to dive into why all of that in their marketing later. Number two brand with millennials. Number one brand with Gen Alpha. So these are all these different generations and they're trending with Gen X now as well. A lot of their advertising has like their Super Bowl ads, for example feature famous Gen X celebrities or even boomer celebrities. 

0:09:40 - Brian Becker
Right yeah, so this is a brand that is really really interestingly positioned. 

Agreed, yeah, so this is a brand that is really really interestingly positioned, agreed, yeah. And we, when we talk about positioning, I like to bring it back to kind of there's four really distinct categories of type of positioning that you can really, you know, tackle or have as a brand being price-based, the second being quality-based, the third being experience-based, the fourth being problem solution and the fifth being category leadership, and so, when we look at Elf through that lens, it's really really clear that they have price-based positioning. On the opposite end, as a low-cost leader, they are someone that you can go to and you can fill your entire makeup bag with, like the fundamentals, the foundational stuff that you need all the time, and then it's something that you can kind of that serves as the basis, and then you have your Chanel or your you know Charlotte Tilbury or Estee Lauder, or whatever, because you like that specific product of here and there, but you know that when you oh, I ran out of this thing, I can grab Elf as kind of my daily wear type stuff, and then you know the other side of this, though, is that they still have a quality based position here as well. You know hearing that some of these products are even better than some of the more expensive versions, while maintaining this low price point just means that they're not sacrificing quality. It's not like the reason that Elf is so cheap is because they have terrible products. It's like everything is cruelty-free and vegan. They're not cutting any corners in terms of the quality of the product. It's all about vertical integration and actually establishing a better supply chain. They have a lot more other ways of cutting costs that we'll talk about in a little bit here that have really allowed them to still kind of maintain that quality too. And so when I think of Elf, I think you know OK, cost savings while still maintaining quality. And then I would argue that there's even a positioning based or, sorry, excuse me, an experience based position that they're taking as well. 

You mentioned, you know, they're one of the top brands for Gen Z and millennials, even coming into Gen Alpha and things like that, because of how well positioned they are as a digital first, very trendy brand. They know trends, they participate in trends, they create trends. They are constantly viral, like all of their products, everything, the way that they communicate, all of their you know marketing and content that they create is all so based on exactly what's going on on the Internet right now, especially around, like the TikTok generation, especially around you know just what's happening on social media and they really capitalize on that. You know that's something we mentioned here is like they capitalize on speed and chasing trends or duping other brands. You know a very common tactic in business is seeing somebody else's product that's working and then creating a version of your own, and you know they are very, very transparent about doing this. You know I even have an image on their social media slide here they have put. You know they have a unicorn and it's like a gif of it saying duping over it. 

0:12:59 - Will Evans
You know where they are willing to say like yeah, they lean into duping they just, they're just like own it. 

0:13:05 - Brian Becker
Yeah, exactly, we are. We're duping these products because you can't you know you can't really trademark the effect or anything like that, maybe the formula, but they are. They're. They're finding ways to dupe these products. But but even better, it's, they are getting these products out in like five months. You know they see a trend and a product that's doing well, their, their, their time, their positioning is is uh, or something that gives them such an advantage is that they are coming out with an uh, an exact replica of that product or something similar in 20 weeks, which is unheard of in in this industry. You know this is normally something that takes six to 18 months to like get through, get through a pro uh, the whole process, whereas they're from concept to real product in and you know, five months or 20 weeks or so yeah, I think what, what they've, what they're doing, you know, just to like be double, just to sort of like color. 

0:14:01 - Will Evans
What brian is saying here is they're, when we say duping, they are taking some of these products, these brands that are in the higher end of the market, and when I say higher end, I'm more talking about high price point here. Specifically, they duped Charlotte Tilbury, a Milk product, a Tatcha Beauty. These are more niche players in the higher price point. I mean, you've got like the Chanel. This category is very competitive. There's brands we're leaving out here, you know. But they've taken that and they basically duplicated that product, a product that might sell for like $30. They're duplicating that product and selling it for $8. And on top of that, they're able to they call it this innovation engine that Brian was talking about where their innovation engine is 13 to 20 weeks, so they're able to go from no prototype at all to product live launched on retailer shelves in as little as 13 weeks. What was? 

0:15:11 - Brian Becker
the industry average. 

0:15:12 - Will Evans
You said 20 months, Brian. 

0:15:14 - Brian Becker
Six to 18 months is like pretty average Six to 18 months. 

0:15:17 - Will Evans
Okay, so that is a real competitive advantage, I think, for them. And there's some other things that I think that they do. I mean, we talked about the vegan and cruelty-free. A lot of these other brands. You know like they compete, like, specifically in this high quality, lower price point. When you look at that market like you got L'Oreal, maybe NYX or NYX, I think, is how it's pronounced Um, these ones are are really they're really quite competitive, especially on Amazon, which we'll dive into, um, but you know they lean in more into this vegan and cruelty-free. There, the speed to market, the tick, tock, the buyer, they're much more like viral than these other brands, social media and they're more inclusive too. Um, this is something I we're gonna have to talk about to the inclusivity, a major, another major competitive advantage they have yeah, no, I think that that's, uh, you know it's. 

0:16:20 - Brian Becker
It reminded me of skims, you know, in the way that they position themselves in the market for being for everyone. They even have their tagline it's for every eye, lip, face, and they even say paw and fin, now as well, with the cruelty-free and everything. And just to keep touching on this, because I think the speed to market innovation engine is really where this brand wins. You know, why this brand works is their ability to capitalize on trends, which we'll talk about with their social media more. But how are they actually doing this? You know, that was my first question is why isn't everyone else doing this? Why isn't Rare Beauty or Kylie Jenner's brand or, you know, why aren't people seeing elf and realizing, hey, this is an opportunity here. And the reality, you know, why does it take six to 18 months for other people? And it takes elf, you know, five months. 

And the reality of that is that, from my research, elf has like four or five third part. You know, they don't have any in-house chemists. They're not making any of these products in-house. It's all third-party vendors that they have really, really close relationships with, and then, on top of that, they are identifying a product, recognizing that a base formula kind of already exists for every type of product in the niche. So it's like all right, all lipsticks formula kind of already exists for every type of product in the niche. So it's like all right, all lipsticks have kind of these same base starts, all foundations have this, all moisturizers et cetera. And so instead of coming up with brand new formulations for different products, they work from these stock formulas, so they're never reinventing the wheel. They almost have for lack of a better term an email design system for their product creation. They have a base template that they're already using that they then move forward with. Rather than formulating, being really specific about R and D and those kinds of things, are really just looking for that result. 

0:18:27 - Will Evans
Yeah, they don't need to do it. They're just duplicating Exactly. All they need to do is take who's who's already competitive. Yeah, you know who's already got a product that people like. Then they send it to their like a like a private label, private label manufacturer or something. 

0:18:43 - Brian Becker
Yep. 

0:18:44 - Will Evans
They basically just duplicate this entire formula, uh, and just make sure it's vegan and cruelty free. 

0:18:50 - Brian Becker
Yep, and and then, on top of that, they also don't. They don't worry about packaging. All their packaging is very stock, cosmetic packaging. They're not putting any extra bells and whistles onto this kind of stuff. It's not like a crazy unboxing experience or whatever. They're again another place that they're saving money on the way that it's prepared and it really comes. It starts to show you. It's like the Zara in a way, or like the H&M of cosmetics. 

Yeah, the Southwest Airlines, any kind of comparison. Whatever industry you want to make, it's that okay. Where can we find certain things that people are doing that are extra, that build in this high price point? And they're not about, even though it's affordable prestige, I think it's more about affordable. Accessibility is even what I would put here. You know, it's like luxury for everyone. Everybody can actually access these products and have a good experience, get the look that they want, without having to break the bank on it. 

And that was one of the most interesting things to me. It's just like how can you stack everything in the background the actual supply chain, the actual product development, the process that you put into that, the research and development. How can you really narrow that down to really actually be what your customer wants and also get it delivered as fast as possible? And that's exactly what Elf has nailed between their digital, first kind of social media presence and using that as their sourcing zone for what they need to do, and then moving that into a very quick, fast, you know innovation engine. Essentially, that allows them to get that product into the customer's hands as soon as they want it. 

So very, very well positioned, they have this market kind of on lock, to the point that you know, as these, as they make these other acquisitions, they're actually acquiring brands that are more like. You know one of their recent acquisitions is a higher price point brand that they keep separate and you know they can still kind of start to integrate the supply chain. You know efficiency stuff like that, but they are maintaining a separate brand because they want to keep Elf what it is in this area of the market. 

0:21:06 - Will Evans
Cool. Anything else on positioning? 

0:21:10 - Brian Becker
No, I think we should. Uh, there's more we'll get into. 

0:21:17 - Will Evans
Let's, let's keep going. Okay, let's, let's talk about the product line. I think you kind of you talked a little bit about it. Um, you know one one thing that's like you said was the pack. They don't invest a lot in packaging, you know, right, that's one thing. It's like very simple packaging. There's not a lot of bells and whistles to it. They now have over 300 products, you know. The average price is $6. 

0:21:41 - Brian Becker
Yeah. 

0:21:42 - Will Evans
I think across their entire catalog dollars yeah, I think across their entire catalog. So there's a huge emphasis on on price. You know one thing I'm just going to unpack this for people that don't know. A lot of girls will know this, but you know I. You know eyes, lips, face. We're talking eyes. We're talking like eyeshadow, mascara, eyeliners, stuff to enhance your eyes. 

For the guys that are totally clueless to this, face, we're talking about like primers, which is, I think, what helps you prepare the skin for makeup Foundations. It's like what you put on first, then blush and bronze and then lips. You're obviously talking about lipstick, lip gloss. You know these are the types of products they're competing in. These are the type of products that they merchandise in this category. Then you have the skincare cleansers, moisturizers, stuff like that. I think that their best seller is. I mean, the reality is, through the innovation engine, they're constantly like ripping on stuff, but stuff that's been the best sellers, their primer, and they absolutely dominate this market, especially on Amazon. Lip gloss does very well this halo liquid filler filter, liquid glow filter that they launched in 2023. I think this is maybe like a concealer or it sort of helps improve the complexion. I don't know if you heard this, but in 2023, when they launched this, they sold one unit every four seconds. 

0:23:20 - Brian Becker
Wow, that's wild. 

0:23:24 - Will Evans
Yeah, I mean it comes back to your point. They need to do a lot of transactions. Yeah, I mean, their tech stack has got to be pretty robust to support that amount of transactions. 

0:23:37 - Brian Becker
Yeah, no, I mean. The reality is, though, is that people's shopping carts, especially with products like this, are not $6. You know they're doing transactions that. I would guess that their AOV is probably somewhere in the range of like $30. 

0:23:55 - Will Evans
Yeah, exactly. 

0:23:57 - Brian Becker
Because people are buying multiple products and you know, at the end of the day, you have a big advantage when your entire product line is routine. You know, at the end of the day, you can, you have a big advantage when your entire product line is a routine, you know, accessible. So it's something that people are doing every single day. It's like I don't go to bed until I've done my nightly skincare routine, which includes sometimes three, four, five, eight, 10 products, depending on how intense these skincare routines are intense, these skincare routines are. 

And then, on top of that, a lot of you know this, this these products just speak to social media. They're just so perfect for all of the trends that are so popular in beauty right now, such as the like get ready with me type stuff, or like, go through my skincare routine, or this is how I achieve you know this look, you know this makeup tutorial XYZ. And so you know, a big aspect of that is what products are people using, and so there's a lot of room for them to be able to kind of feature their you know a large amount of their product suite throughout that, throughout those processes. And so, yeah, I mean they're it's pretty straightforward what they sell. It's, you know, sell. The packaging is there. It's what other people are selling as well. They're straight up talking about how they're duping it. It's more about how they're actually doing it, how they're finding what's going to be popular and what they're going to push, and that's really where the magic happens here. 

0:25:19 - Will Evans
Correct. Yeah, anything else. I mean this is part of their product line. I think, like you've already hinted, they own other brands too, but the main winner, the main thing here, is elfcosmeticscom, elfskincarecom, and then I believe they own some other brands too. We want to cause we're breaking down the whole entire company here. 

0:25:41 - Brian Becker
Right, yeah, and so they've um. Over the last few years, I think Naturium was the most recently acquired brand Um and that was just, uh, it's a. This is the higher price point product I was talking about, um. They also own Alicia Keys uh, wellness inspired beauty line, um, and they own another clean beauty brand in, well people, yeah, um, I think natrium is, or nate if we're pronounced. 

0:26:06 - Will Evans
That's the big one here. Yeah, they acquired that for three. This was in 2023 355 million dollar transaction, um, and it's more like scientific, but it's weird. It is like a little bit more premium, but it's still not quite prestige, I would say. I mean, that's the word they describe this category in prestige, or if you read their annual report, they're using that a lot. We're talking like $20 serums, $15, not $5 or $6, yet not like $40 or $50. Right, if you went into like a Nordstrom or something, so that's the big one. And then I think the Alicia Keys one was a joint venture, if I'm not mistaken. And then, well, people is, this fits in very much with their so Natrium like immediately expanded them more into the skincare, their skincare business. They're already doing well with uh, with um, cosmetics obviously. Then I think this like literally overnight increased their sales by like 20 percent, um, and this is a tried and true playbook. You know procter and Unilever these massive conglomerates own all a portfolio of brands you know, and that's probably what they're doing here. 

0:27:42 - Brian Becker
And it makes a lot of sense in the beauty space as well. L'oreal, like, they all own multiple, multiple brands that you don't even realize are owned by, you know, because they have different brand names just under the same umbrella. And so, you know, this is a pretty tried and true playbook as far as once you hit that billion dollar mark, you just start kind of acquiring other things and merging the supply chains, you know, finding ways to kind of, you know, beg, borrow and steal from all the different brands to kind of get into one, you know, unified, very, very optimized brand umbrella, and so they're definitely moving into that space. 

0:28:18 - Will Evans
Yeah, it makes sense. You know you have Natrium that allows you to move into more premium price, because you couldn't really just be like, oh, we're going to do, they do have elf skincare, but they couldn't just like double the price point on that, you know right, yeah it would. And then they have, uh, the well people, which I think was a 27 million dollar all cash acquisition and that's more like plant-based cruelty free um I mean, all of their products are like that, but I think it really leans into that angle yeah um, and then there's the key, the alicia keys, and I looked at the traffic on all of these two and I have to me it looks like natrium naturium. 

Don't know, I might be butchering the name here. Um is uh. Really, I had actually never heard of this brand. 

0:29:17 - Brian Becker
Me either, yeah. 

0:29:18 - Will Evans
Yeah, and this is a, you know, almost a $400 million brand. Um, and this one, I mean, it generates almost alone, it generates about 750,000 unique visitors a month. Wow, okay, yeah, and that's almost 10 X the size of the other two stores that we're talking about here or brands that we're talking about yeah, Um, so that was that's the big one. 

Um, yeah, I. I think I mentioned they have about $100 million in cash on their balance sheet, so I could see them doing another transaction here, Maybe this year, who knows? But that to me seems like the playbook just acquire more brands. 

0:30:08 - Brian Becker
Agreed. No, I think that this is definitely where they're going to start heading. I think that's the path to growth for them, for sure. 

0:30:15 - Will Evans
Cool yeah, anything else on their brands. 

0:30:19 - Brian Becker
No, let's keep going. 

0:30:21 - Will Evans
Let's keep going. Okay, what do we got? We got the team. We can talk a lot about this. Well, brian, why don't you talk about the founders first? 

0:30:27 - Brian Becker
because they're no longer as involved, if I understand correctly yeah, and they were, um, you know, like we said, it was kind of an idea born out of, uh, while attending nyu, um, a little over 20 years ago, uh, you know, got some help from one of their dads and and kind of put this together. 

We were really trying to sell into dollar stores at the time, you know and we'll talk about this a little bit more in a bit but they really started to pioneer the whole digital first brand. It was actually because they had an offer from Glamour to get their products featured by Glamour, but they weren't available, the products weren't available nationwide, so they couldn't actually Glamour wasn't willing to feature them if their readers couldn't get the products, and so they had originally had kind of like a product portfolio website. It wasn't an actual e-com site. This was back in like 2004. And that was when they switched it over to an e-com site and really kind of started to pioneer that entire segment of the category. You know there's argument that elf might be like the first digital you know digital only beauty brand. So that's a pretty interesting thing. But yeah, it seemed like they had pretty, you know, just slow and steady growth until 2014 when the current CEO was appointed. 

0:31:59 - Will Evans
So if you want to go through the executive, you know even before that you know you put I think you put this in a huge focus on diversity as a strategy. That's something I picked up on too. Yeah political term, but you know, I honestly think that this is one of the only companies that I see that actually lives and breathes that Um. 

I feel like most people, they just use it as a prop. These guys, it's like clearly a competitive advantage, um, for them, um, and they actually I actually believe them and they own it really really well. Yeah, and that to me is something that did like really stood out to me. I mean, I'm going to read some crazy stuff that I that I took down here. 70% of their employee base is women. Yeah, 65% of them are Gen Z or millennial. We're not, we don't. We're going to spend more time talking about the team, not so much the board, but 80 of their board of directors is women yeah um, that is only four. 

there's only four companies of the s&p five or the publicly traded, four out of like 4,200 companies have a board that that has more than 60% and they're 80%. Um, so like when, when you hear brands talk about, oh we're inclusive, we believe in DEI, these people actually walk the walk, or this brand actually walks the walk. In my opinion, when it comes to that, and I feel like part of the playbook, I mean, this is why I think they, they really can execute so well with the innovation engine and the trend the stuff that we were talking about in the positioning when you have a team that is mostly women and mostly Gen Z and millennials. 

0:34:10 - Brian Becker
Yeah, I mean, that's actually something that Tarang Amin, the CEO, has said in an interview. I found a quote from him that he said the most important thing we do is engage young, diverse beauty enthusiasts. These are the women who are driving the entire category. So it's like, yeah, who do you? These are the people you want to be running this product, because these are the end users. These are the people that care, that align with the values you know when you talk about a culture fit for for a brand as you hire and things like that, that's exactly what this is. You know they're trying to have inclusive products, you know built for for, you know, an inclusive group, and so you need to have that be the people driving the company. 

0:34:52 - Will Evans
Yeah, so you know you bring him up. I think we'll start with him because I think he's a key hire, moving into the executive team. You know came in 2014. Another person has sort of like an executive corporate MBA from Duke type background. I had never heard of this company, but he came from Schiff Nutrition. They are also publicly traded where he grew them from. He took them from like 190 million in sales to 1.5 billion 190 million in sales to 1.5 billion and Schiff. They make like a bunch of like gummies and like low cost sort of supplements that you can buy. He also has a background at Clorox and was head of their cat. 

I think it was the food and charcoal litter business. Um so this guy has a really, really good sort of CPG executive background. 

0:35:57 - Brian Becker
Yeah, I think one more as well as he. Uh, he helped take Pantene when he was at PNG. So the um shampoo brand, uh, from 50 million to $2 billion. 

0:36:10 - Will Evans
Okay, so he was involved in that brand. 

0:36:11 - Brian Becker
He was involved in that as well and something I found really interesting about him as well. As you know, he so he's from an immigrant family. They lived in Alexandria, virginia, and what they did was that when they moved here, they actually purchased a motel and so he grew up, you know, with his parents as entrepreneurs, kind of working. You know they lived in the like manager's apartment above the hotel, you know, and he was like working the front, front desk, you know, and he has said you know the, everything he knows about cash flow, economic profit, you know how to treat people and customers and things like that all comes from that kind of you know, even though even with the Duke MBA, you know most of it comes from the that really formative, you know, 14, 15 years old, working at the motel with his family, um, so he's kind of had the entrepreneur and like drive to to build this, this kind of business, for for his entire life, um, which you know, at the end of the day, is is the kind of person you want in that seat. 

0:37:06 - Will Evans
For sure. I mean, we've, we've been exposed to these types of businesses, not elf, uh, but like more legacy, I would say legacy, uh, cpg businesses, and I'm just going to be honest, like not many people are entrepreneurial in these companies. 

0:37:26 - Brian Becker
He never. You know, I sometimes I don't love putting on oh they came from this company or this company or this company, because, you know, coming from P&G doesn't necessarily mean that you yourself know how to operate as an entrepreneur. Honestly, to me it's a signal that you don't. Maybe you know that you're, because it's such a different culture in corporate America of like what do you need to get done to look like you're getting stuff done versus what do you need to get done to really get results. 

And there's a lot of that in the industry, like even through the NBA, probably even through his like stuff at Clorox or P&G and things like that. The real, you know experience that he understands about profit, about cash flow, about these kinds of things, comes from when your skin is in the game, because you have a very visceral understanding when your parents are, oh no, we don't have enough customers, we're not making enough money, you know we don't have food on the table kind of an experience that you can really only understand if you're putting it on the line like that. And so I think that probably drives a lot of how he's built this success. So, yeah, lots of interesting stuff. You want to move on to some more people on the executive board. 

0:38:46 - Will Evans
Yeah, I watched a lot of stuff from Mandy. I think she does some of the quarterly earnings. I think I listened to one she was on A lot of the CNBC talks. 

She'll do and again you'll see woman in power high up. They walk the walk here In power, high up. You know they walk the walk here and the numbers speak for themselves. I mean, we've already gone through some of just the high level stats, but I think that you know she's been involved since 2019, right, and I think it's something like 19 consecutive quarters of growth that she's been CFO Can't argue with that. 

0:39:26 - Brian Becker
Let the numbers be the guide. 

0:39:28 - Will Evans
Yeah, yeah, yeah. But yeah, also very strong background in consumer. You know Gap, everyone knows Gap. 

0:39:40 - Brian Becker
Yeah. 

0:39:40 - Will Evans
Former VP at Ross. I think Corey is another one that's really, really interesting. The CMO Corey is another one that's really, really interesting. The CMO no-transcript about at the top of the show. 20%, 24% of their net sales go back into marketing. I don't think that it was like that five or six years ago. It was more like 9%, and I think a huge part of that is because of the success that they're having with their CMO. 

0:40:25 - Brian Becker
Right, Right, yeah, no, I agree, I think that there's, you know, the. We focused a lot last time on the on the board of directors, when we talked about Yeti Um, and I think there's still some some things that kind of reinforce the point you just made there. Like when you start to look at the companies that their board of directors come from as well. You know, obviously, uh, companies that their board of directors come from as well. You know, obviously, Tarang is the chairman, but you have a CFO from a hospitality group, so really looking at how to service customers. They have that global head of partnerships from Netflix, so obviously very driven on the content creation. You know how do we actually produce which you'll see with a lot of their, the content that they're creating, that it is, um, it's like movie level or TV TV show level, like fully produced commercials and some of the content, Um, they have a portfolio manager from uh, environmental, social and governance, like investment fund, so it's called Parnassus, but it's all focused on, you know, sustainable investing. 

So, again, you know, deepening this kind of ideology around their commitment to cruelty-free, to vegan, et cetera. They have the CMO of Levi's and she's also the former head of marketing at Snapchat. So another youth marketing kind of cultural relevance, you know, really, really dialed in as far as, like, what is Gen Z doing? What is what are people doing on Tik TOK and things like that? They have the former CEO of Bath and Body Works on there as well. So retail expansion, you know there's. 

0:42:07 - Will Evans
I think the guy, the one from Levi's in, in terrain are the only guys on the board. Am I correct in that? 

0:42:14 - Brian Becker
is only kenny oh, kenny, I thought kenny was a woman as well, actually but because that could also be a woman's name, but you might be right. Let me see kenny mitchell oh yep, you're right, yeah, so yeah, I think that you're right. Those are the only the only men on the board of directors. 

0:42:33 - Will Evans
Um yeah, it's, it's all, mostly women after that, all these people that you're, yeah, like where they're coming from. You know. I mean we talked about it a lot like it kind of reveals the playbook. Yeah, um, my takeaway Elf was compared to Yeti, where we broke down like Yeti's board was like really like you could, like I felt like the board was really driving the company. You know, with Elf I feel like it's more like the team, like the actual day to day employees. 

0:43:11 - Brian Becker
Yeah, yeah, I think it's you're. You're spot on with that, um, especially considering they are so driven by. I think you know the team is one thing, but I think it's the team paying attention to the data, like I think it's the way that you know they are interacting with their customers and producing in a viral, you know speed to market kind of strategy which is in and they're looking to double down on their commitment to sustainability and to, you know, growing that kind of environmental awareness and the impact of what they're doing as well. And you know it's very, very cool to see how that comes together. 

And you know, I had never really thought about board of directors as such an interesting way to like put a microscope on like the more broad strategy, the like stuff that you don't really get from looking at the P&L and like the, you know what they tell you in these kind of like quarterly reports or your annual reports and things like that. 

They say the like the bare minimum on what it's going to be, but really starting to dive into what these people are doing and who it is that they want to be sitting in these very coveted spots really kind of tells you what they want to do, and it's cool with this one that it's also relatively transparent. Again, it's like all right, we know what they're kind of trying to do here. The one surprise and I might have missed it and I might've missed it is I didn't see anyone who is like an MNA kind of you know, you know, expert. That's one person that I would assume they might have on their board as well. I also didn't find any anyone that had a lot of like MNA background in on their executive board either, but maybe I just didn't dig far enough. But that is one thing that I would expect them to have a little bit more focus on, especially at this stage and with so much cash. 

0:45:18 - Will Evans
Yeah, that's a great point. Um, I don't think I saw that either, Um, but it makes a lot of sense, you know, given that they're going around, you know, 2023, they acquired the one we just talked about Natrium. 

0:45:33 - Brian Becker
Yeah. 

0:45:33 - Will Evans
You know, I would imagine that you know that overnight, like you said, grew their sales by 20%. Yeah, so I'm surprised they're not. Yeah, I mean that's that there isn't somebody. Maybe, again, maybe we missed something, maybe their CEO or their CFO. They probably got exposed to that, you know, and other stops in their journey, but it is helpful to have someone who's like that's like their bread and butter playbook on the board. You know, right, anything else you have on team? No, I don't think so. Yeah, think so, yeah. The only other thing I would say I read some stuff I think every employee gets equity it's pretty nice, okay. 

um, I don't know much about that. I just I just saw that that that might be, but I mean, they are a publicly traded company, so it's probably like easy to distribute that, yeah, and they get paternity leave for dogs. Really Excuse me. 

0:46:33 - Brian Becker
Paternity leave. 

0:46:35 - Will Evans
Paternity leave for dogs? Yeah. 

0:46:37 - Brian Becker
That's amazing. 

0:46:39 - Will Evans
How long is it? I forget what it was. I don't know if I remember it was disclosed. 

0:46:43 - Brian Becker
Man, I could have used that. Yeah, I know you remember my days of trying to manage my puppy while running Flow Candy. That was a challenge for sure. 

0:46:54 - Will Evans
Yeah, I mean I think that you know, like my biggest especially with the dog stuff, you know is I kind of come back to they. Just they really like live and practice what they preach. They're talking about diversity and inclusivity, but okay, like, go pull up our org chart, it's a reflection of that. We talk about being like animal and cruelty-free. Okay, you actually get like Paulternity leave. So I think that that's really cool, especially when you get a company. I mean you see that a lot with smaller businesses, you know more founder-led, even some of the mid-market businesses, but to see like a publicly traded company in the enterprise still have that sort of like dna is pretty cool agreed, agreed. 

0:47:47 - Brian Becker
Let's move on to branding. Start talking about what they do there. 

0:47:52 - Will Evans
Really interesting. I believe you found a brand book. We probably should disclose that I found a brand book, but it's from 2015. 

0:47:59 - Brian Becker
So it's pretty old, yeah, but you know, I think the beauty of Elf, in my opinion, as far as the branding goes, no pun intended but is that it is extremely minimalist. Right, and I might be taking some some liberties here and kind of putting my analysis on here of like why it's so minimalist, but really when I look at it it's like elf can be whatever they need it to be in certain, in certain instances, the, the logo is so basic black or white. You know ELF eyes, lips, face you know the way that they present themselves is is so monochromatic. It's very practical, it's very accessible. It's not a there's not a bunch of like colors that have to be used all the time or like you know, certain typography and fonts and like, oh, this kind of image. If you look at their Instagram or their you know their website, it actually feels like there's a lot going on because there's a lot of different styles. They're not really like held back or, you know, gated by a really strong brand personality. You know, we've seen firsthand, we've worked with a lot of brands that have the design at Flow Candy is so good that a lot of brands that have that kind of prestige feeling designs and really detail oriented design focus are drawn to us because they know that we can hit that kind of thing. 

But we know the kind of setbacks that that can have for a company, especially when you're trying to move quickly. You know, if you're trying to send, you know, five emails a week or something like that, or you're trying to get a new product out the door, you're trying to, you know, throw up a landing page or a campaign for XYZ, the more rigid your design and branding standards are, the more tough it is to keep up with it on a regular basis. There's too many checks and balances that need to be, that need to go through. You have to get approval from the creative director and approval from this person, and this designer is like oh well, this is, you know, two millimeters off, or et cetera. And so what I saw from Elf and what really spoke to me as you know, with my background in design was like we, this is something that you can use to get business done, which is really something that I would like to see more in design. 

A lot of the time it's like how do we make business the forefront of design and they reflect it in their packaging. We're not really married to having this crazy packaging kind of stuff that needs to be perfect. Every time we use stock packaging, we're going to make sure that the branding is stock and a feeling is a feeling way as well. It's more about the product themselves, it's more about the accessibility, it's more about the price point, rather than going over the top and kind of creating this you know, world or world building thing, which we, you know, which I love in its own right. But I think this is a really smart business decision. 

0:50:46 - Will Evans
But I think this is a really smart business decision. Yeah, I mean I sort of took away that their branding. I mean I think you hit the nail on the head that it's very it's almost like they don't put a lot of focus in the brand. You know, it's like just the branding is not necessarily like a lot of people when they think about branding like oh, what's my topography, what are like my, my colors, my logo, my the margins, the padding and all that stuff, it's like they just do sort of the basics to get by and, like you said, like what I would. You know I love hearing that like let's make the brand good for business, not the brand good for design, you know yeah, and it's really clear when you scroll through. 

0:51:33 - Brian Becker
You know, like their, uh, their instagram, there's so many different versions of the brand in here. You know they have poppy fun, pink stuff with, like, the megan trainer. They have more of like this darker clinical feeling with this elf von zen thing that we'll talk about. It's like 11 out of 10. Um, this like, uh, scientist kind of guy there's. You know there's this. There's a football themed one for all the stuff that's happening with the, the super bowl. You know there's really not a, a clear, defined like this is what elf is and these are the colors which you know it just oh perfect, yeah, so yeah 

as you can see, there you have the guy in the lab coat with the pom poms, you know, like a very kind of like clinical feeling, and there's more of him, but then you have, right after that, trial and terror, you know, and then you have the puppy. There's just, you know, there's so much in here that is is so different. You know, it continues to to evolve depending on the need of the brand at the time. Yeah, which I think is really beneficial because it allows you to engage wherever your customers are Considering, like one of you know, if you think back to, like the Liquid Death partnership that they did I'm sure you saw that where they Elf and Liquid Death did the whole, you know they have a whole makeup line, yeah, with like Kiss style makeup. 

So, you know, like the band Kiss, and you know they have the black kind of goth makeup and you know, if you're like a poppy, you know pink and blue. 

You know some other brands might say that that's not us. 

You know we're not going to do that type of partnership because it doesn't align with, like, our brand aesthetic and image and things, and I think that Elf has really given them a place to be for every eye, lip and face. 

You know, it's another, another way that they're really kind of tackling that diversity and inclusivity across the board is that you know, elf is not necessarily one thing. It is a guideline around a value of, you know, approachable, friendly, empowering, you know, and accessible, friendly, empowering, um, you know, and accessible. And so this is, this is something where brand brand really means a lot more than just like, like you said, the typography and the color palette, um, and and I I think they've done a really good job of kind of making themselves a bit of a chameleon to to be whatever you want elf to to represent for you yeah, it's similar in the sense where, when you were talking about how a lot of brands when we were just looking at their Instagram 30 minutes ago, we were looking at the positioning slide A lot of these brands Chanel would never put that guy with the lab coat or you know a dog on their Instagram feed. 

Yeah, yeah. 

0:54:31 - Will Evans
And I'm not, I don't think they did this intentionally, but like, in some ways it is similar to the playbook of liquid death where, if you go back to that, that brand and what was the irreverent, might've been the word that he used where it's like. 

We're just like riffing on popular culture yeah you know, just like how south park is, and south park has been around. Or snl saturday night live, like like comedy, almost um. And yeah, these brands have been around, these entertainment brands been around for 20, 30 years now. I mean, that's now like 40 50 maybe. 

0:55:08 - Brian Becker
Yeah, it's 50 there. They have an anniversary show coming up yeah, uh, and it's similar vibes here. 

0:55:14 - Will Evans
It's like the brand is is more about. I mean, the packaging is just minimal. It's almost like minimal on purpose so that it is accessible to everybody, and they're just going to sort of, you know, because of the virality and because of the innovation engine. You know that's really the brand and the accessibility that you brought up. It's not the products or the design style, and so you know they can just sort of riff on it Whatever is popular, whatever is trending. You know they can just dupe riff on it Whatever is popular, whatever is trending they can just dupe that over and over and over again. 

0:55:56 - Brian Becker
No, I mean, I think that there's a lot of similarities here to Yeti. In my opinion, actually, yeti is another. They are a little bit more opinionated, they have a little bit more of a color palette and that kind of thing. But what is so important about both Elf and Yeti branding is that it's not about the product and the brand. It's about what you do with the product and the brand. You know it's about how are. How does this engage with what's meaningful to you? So like, for instance, this bottom photo. 

Here is an activation that they did at Coachella. So you have, you know what is this? Eight, seven, eight people with all different styles of like festival wear. They're all influencers in their own right, but they're all united by that. They are using elf products as part of. You know their look, but the look might be different. So it's about how are you engaging with makeup Because of you know their look, but the look might be different. So it's about how, how are you engaging with makeup? Because, yes, there is, uh, you know somebody who's using elf makeup to do their full goth. You know, like the kiss kind of makeup type thing, or there's somebody who's using it for more of a glam look or whatever. Whatever it ends up being Right, and I think that's what is so important around around, around here and how it relates to Yeti is like you might be using this for a day at the beach with your, with your family, or you might be using this other, cooler bag for, you know, a trek out on your four day hunting trip or whatever. 

Create your own affinity and where it's where this experience side of the experiential positioning comes in, that they're really able to say like, hey, this is a, this is something that is used for you, and they then start to highlight all of that. 

They then start to bring social media into it. They start to meet people where they are, where they're talking about it, how they're using it, and they make those the stories of the brand that allow it to go so viral, because it automatically authentically resonates with other people that have that same need. And you know this is it's super key. You know, because if you tell people what to think about your brand, they're going to think that all the time. And there are some brands that do that incredibly well, like Vacation or, you know, you know Liquid Death, even on a certain level. They are really strict around their branding and the way that it kind of appears, but it's kind of, you know, you think the same thing of that brand every time, whereas Elf can kind of navigate as a chameleon through these different groups of people which you really really need if you're going to hit this like mass market appeal and just sell you know $6 products and want to hit you know billions of dollars in revenue. 

0:58:30 - Will Evans
Right, yeah, they've nailed it. I thought you know there's a lot of good. It's just really interesting Cause I think it faced value. You know a lot of people that are branding experts, designers, basically like this brand sucks, you know, but it's actually. They don't even understand what a brand is in a lot of ways. You know sucks, you know, but it's actually. They don't even understand what a brand is in a lot of ways, you know. 

Um, I thought you said something very interesting. It's it's not what, what, what the brand is. It's like what you do with the products you know um any other tidbits you want to share? 

0:59:05 - Brian Becker
on the brand, no, I think they do an incredible job here. You know they're they again, another place that they just keep nailing the diversity, um and and making it. What about the customer again, rather than just about the product and the brand? 

0:59:16 - Will Evans
Yeah, all right, let's let's jump into some of the more tactical stuff here. Um, so we've hit a lot. We've hit a lot of the high level stuff, like the stats, the team, the brands, the products, like the more um, I don't know what the right word is uh, more meta. Maybe now we're getting into the, the, the nitty-gritty tackle stuff. We'll start with the tech stack here. 

Um, similar to yeti, the store we broke down a more mid-market, not quite like legacy enterprise tech stack, but certainly not what a lot of these sort of newer challenger brands that have reached the mid-market are using. They're not using Shopify, they're not using Klaviyo or PostScript or Syngrid or, excuse me, synlane. They're using Salesforce for their e-commerce store and probably they're doing that to manage also the wholesale side of the business. I bet, too, braze is what they're using for email marketing and SMS marketing, which I think Yeti was using too. And if you don't know what Braze is, it's kind of like Klaviyo, but it can do everything Klaviyo does. But I would say it's a little bit more. I don't know if omni-channel is the right word, but more for like. It's especially useful if you have like an app, if you're like DoorDash or Uber Eats. You know it can do a lot of those push notifications and stuff like that. 

1:01:07 - Brian Becker
Anything else that stood out to you on the tech stack, yeah, I mean. So I did a little bit of digging here in terms of tech stack and thinking about this from a strategic standpoint Just to be able to. You know, even we don't have a, you know, completely honest, we have some experience with, like enterprise marketing stacks and stuff like that, marketing stacks and stuff like that. But you know, since we've never run an enterprise e-com brand or anything like that, really trying to get a feel for why do you end up choosing Salesforce or when do you move to Salesforce? Because I think that's really when we start to talk about why brands work, people might look oh, oh, my gosh, you know they're doing a billion dollars there on Salesforce. Maybe I need to switch. You know, maybe this is something that is is going to be important. Maybe I need to be looking into braids to like really, really get to the next level. Um, you know, so it's kind of that question of like Salesforce plus braids or Shopify plus Klaviyo, right? Um, and something as I'm looking through is that it really does come down to the number of channels that you have in distribution, because when you have all of these retail partners, you have global partners as well that you're selling through, while you also have an e-com brand, and it's really there that you start to get the advantages of using a tech like Salesforce, because it becomes a lot more, a lot more easy to kind of roll out like localization and stuff like that. So you know it's, it's built it, you know you can, you have direct access to the, to all of the code of Salesforce, whereas Shopify is a little bit more, you know, behind closed doors or some things you can change or you have to use an app to actually get like the localization done and stuff like that. And so as brands graduate to this level, it really kind of becomes you know Salesforce you can almost start to look at as like it's the framework for a headless experience, rather than you know an out of the box solution like like Shopify and so you have you know. 

What that means is that you know of those 390 people, there's definitely at least 10 to 15 of those that are developers you know, like that are on their org chart, you know, and so they, you know. That's when you start to get to that point, when you have enough things that you're rolling out and problems and stuff with. You know your website and whatnot. It's really more about having that support to create custom solutions on a platform that is proven. And Salesforce, obviously, you know massive company I'm you know I'm in San Francisco right now, so every time we drive in I see you know whatever Salesforce tower, whatever it is, and you know it makes sense why they are kind of the market leader in that space. 

But really it's kind of it's the whole question of you know how big is your business? Are you graduating out of? You know driving a. You know a nice. You know recent year kind of. You know Toyota to wanting to drive like a McLaren or something like that. That's really kind of. You know Toyota to wanting to drive like a McLaren or something like that. 

That's that's really kind of the, the, the move that that you're making at that point, um, and so, yeah, it's, it's interesting. It makes sense, though you know there's a lot of moving parts. When you end up having that many transactions, that many sales, that many distribution partners, um, you know it seems like from some of the strategy as well, that they're probably moving into. You know it seems like from some of the strategy as well, that they're probably moving into you know, more wholesale and like direct selling, into, like beauty salons and stuff like that as well and so like, as you add on more affiliates and all these different you know selling pathways. You just have to have more control over the platform if you want to consolidate that data and actually extract data, actually extract insights from it. 

1:04:49 - Will Evans
Right. 

1:04:50 - Brian Becker
So yeah, just wanted to, you know, answer the question for myself, so I figured I would I would share it as well. 

1:04:56 - Will Evans
No, I think that's. There's a lot of good stuff there. I mean my sort of take on all that would be. You know, I think you bring up a good point. It's like you know, if I'm just sort of empathizing with someone watching this, like you know, I think you bring up a good point. It's like you know, if I'm just sort of empathizing with someone watching this, like you know I'm doing, you know, $10 million a year, $50 million a year. I want to be doing a billion dollars a year like Elf. Do I need to switch to Salesforce and Braze? And the answer is no, you don't. Just you know. 

I thought that's a very good question. You could scale to a billion dollars with Shopify and Klaviyo. Earnings come out next week, you will see that their whole playbook is trying to aggressively expand into the enterprise and they're doing a lot of the stuff that Brian talked about that the enterprise wants, like localization, making code more accessible, like one of the big things Shopify is pushing is like international, and I forget the name of the big things. Shopify is pushing is international. And I forget the name of the program. Klaviyo has another program too that allows you to easily be able to launch different instances in different countries. Because, yeah, this is something that in Salesforce is way easier to do, and I think the pros and cons you brought up one of the pros, some of the cons, I think you even brought up too. Like, if you're going to move to Salesforce, you're going to need somebody dedicated to manage that, preferably on your work chart, not an eight. You can have it, you can outsource it to an agency Always can do that, but this size you probably want somebody in house, I would imagine. 

Um, you know another thing that I think about when it comes to Salesforce versus Shopify um is a lot like this company is what two founded in 2004. Right, um, I mean, that's like the stone age when it comes to to this sort of stuff. You know, shopify, it's prehistory, started in what? 2011, 2012. And it really wasn't till around. Like. You know, the whole knock on Shopify when you first started was you know, uh, oh, you can get to like, you can build a little like lifestyle business, but once you get to a million dollars a year in revenue, you need to go to Magento. 

1:07:35 - Brian Becker
You need to go to. 

1:07:36 - Will Evans
Adobe. Um, this was like you know, people were saying this in like 2015, 16, 17, 18, kind of pre COVID. I mean now they've blown that, that out of the water. Pre-covid I mean now they've blown that out of the water. I will say one thing to think about when it comes to Salesforce and Braze for Shopify and Klaviyo is you're going to be paying a lot more money. 

That's another thing you need to think about Both of these apps cost. I mean, people are always complaining about Shopify's price point or Klaviyo's price point. Well, shopify's price point or Klaviyo's price point? Well, newsflash these guys charge you even more. So I think for Braze I don't know if you've heard this, brian I think for Braze they charge you based on how many API connections you have, which makes sense. 

1:08:24 - Brian Becker
Yeah, like that is where you need to start thinking about when you're moving. Yeah, because Braze allows you to create dedicated, like custom API connections, which you can do on in certain instances with Klaviyo and things like that. But that's the. That is. The benefit of Salesforce and Braze is that you can now create an API connection for every piece that you have in your business. You know, from the taxes and VAT that you're collecting in the UK to you know your retail partner in you know Southeast Asia to you know there's all of these different things that are that are floating around. Once you hit this level that just need to be consolidated and until you get to that point where where you're running out of room to actually do that, the problems will arise before you need to switch. That's really what it comes down to. You have to have a very dedicated reason that you're switching over and something that will continue to be a problem down the line. 

1:09:23 - Will Evans
Yeah, I think with Salesforce too, something that we didn't. Salesforce is actually not traditionally a e-commerce first, it's more of like a CRM, a sales B2B sales CRM, and that actually you have to come back to the business model. Or like the revenue of Elf I mean, 88% of the revenue comes from retail, which you know, and again, like a lot of it is coming from Target and Walmart. It's not like they don't have like a huge database. Probably, or maybe they do, I don't know, but there's that sort of the part of the business managing the POs and the invoices and all that sort of stuff. It's not like a one-to-one relationship. 

1:10:11 - Brian Becker
It's not like there's, you know, the one person at Target and the one person you know at Elf that take care of it. It's uh, there's a. There's a lot more than that. 

1:10:20 - Will Evans
A lot more is buyers. You know multiple buyers, probably per category they're in especially if you've got skincare, beauty. Um see, I mean that's just a little bit. You know we could be wildly off, but you know that's, you know. I think those are fair takes on why a brand would choose Salesforce and Braze. The only things I could think of is just security sometimes, but Shopify and Klaviyo are very secure compliance, yeah, yeah. 

1:10:50 - Brian Becker
Yeah, I'm curious if we keep doing publicly traded companies, if we're going to find someone on the Shopify Klaviyo stack or if this is going to be the stack, if we keep on with the publicly traded companies, you know. 

1:11:04 - Will Evans
Most publicly traded. They're going to be used. I mean, like I said at the beginning of the slide, this is even a more tech-enabled tech stack for the enterprise. If we go pull up Procter Gamble, it's like. I mean, they're so probably frat SAP probably. 

Yeah, SAP Oracle has obviously acquired a brand like native, you know, that's digitally enabled, that is running Shopify and uh, Klaviyo, um, you know, probably some of these are like triple whale, some of these other more like new age stuff, but like that is not adopted across their portfolio, their brand portfolio. 

1:11:43 - Brian Becker
Yeah, yeah, all right. Well, let's jump into traffic. Let's, uh, cool, teach us about traffic. We'll tell us where they're getting all their people from. Yeah, let's. Well, let's jump into traffic. Let's teach us about traffic. Will Tell us where they're getting all their people from. 

1:11:52 - Will Evans
Yeah, let's get into this. So I guess we can pull up the funnel breakdown here. Let me pull that up. We got the Lucid app. Um. Well, first off, like off the cuff they are, they rank 112 in the entire category of um in terms of traffic. And you know, the people at the top are like, are not private label brands, the, the people that are at the top of this category are like in terms of just pure traffic. It's like Sephora, ulta. You know like these guys are generating, you know, I don't know, off the top of my head, maybe like 10, 20, 30 million visitors a month, while Elf is more more around. You know, uh, 3 million. Actually, Sephora and Ulta are much higher. I have it right here we have 141. This is over a three-month period. So what is that? That's over 40 million visitors, 173 million. This is over the fourth quarter, november to. 

January, sephora had 173 million people come to their site, and so yeah, like those guys are the number one in the category. Let's see if I can go split screen here. Maybe no, okay. I'll just pull it out when I want to jump into the actual funnel breakdown, but yeah, so we've got about 3 million visitors a month, which is a lot. 

by the way, that is a huge store, a huge business. I'm not trying to throw them under the bus, I mean most. We were just talking about Shopify stores. I don't think there's a single Shopify store that's in the top 100 in this category. I think you got to go to like maybe like 130 or 140 and you get to like Glossier. Did I pronounce it right? I think they're the first shop. They're the first like Shopify store, shopify plus store yeah, it's probably using Klaviyo, that is. 

That is on this list 75% US, which is high, but honestly, you're used to seeing a lot of these brands at like 80, 90, 90%. No surprise, strong brand, direct and organic are the top channels. I found it interesting that most of the traffic is landing on the home page. Sometimes you get these, these businesses, where it's like you know they're landing on the primer page. Or this, the concealer, the halo glow, the product that we talked about that sold one every four seconds or whatever. 

Um, and like pretty decent paid traffic, pretty decent social traffic. I think, like a lot of these brands, we're starting to notice that, like we, we see that you know, 70, 80% of the traffic, when you combine it together, is coming direct, organic. But how much of that is really attributed back to social? Um? That's the question I want to know, because it says 11% are coming from social. But how much of that is really attributed back to social? Um? That's the question I want to know, cause it says 11% are coming from social, but how much of it is coming Like brand awareness is being generated from Tik TOK with elf? Um, that really, that's where it should be really attributed to. That's that's what I would like to know. 

1:15:24 - Brian Becker
Yeah, I mean, at the end of the day, traffic has become so much harder in terms of attribution, with you know, being able to really understand what people have have seen before they actually get to the website, and you really only truly know if you have access to that CRM data. You know if you can see every time that that profile is pinged, you know and, okay, well, they received this email or they saw this text or they saw this ad and then went to this. You know this TikTok, et cetera. So, yeah, it's tough to know because there's definitely a significant amount of like the direct and organic traffic that is coming from social, Like the top of funnel awareness, is coming from social. 

1:16:05 - Will Evans
Totally, totally. I couldn't find any stats on, like, how many people already knew, like how many people in the beauty category knew, like are already aware of health. I would love to know that. Yeah, yeah, because it's like, how much brand awareness. I mean, I don't think they really need to do much brand awareness in the gen, z and millennial market. They're already the number one category. It's probably a lot of like retargeting and stuff like that. 

Just staying relevant. Okay, let's dive even deeper here and I will pull up the funnel analysis Again. You can download all of this. The email breakdown too. We're going to pull that up. Let's go over paid first. 

So when I think of paid, they've probably got three or four things they're doing here. There's obviously paid search. So this is like if you were just to go to Google and search elf, elf cosmetics, elf makeup, elf primer, elf concealer they're going to pop up Branded search. A lot of this we can do it right now. El sponsored ads. So this is, you know, a lot of their paid traffic is just coming from this. 

Sometimes you'll see, like Ulta or like some of their other retail partners pop up here, but when I just did it in incognito, it looked like everything was popping up to their store. I'm not going to click on their ads, I'm not going to be that evil. But then we have display ads. So these are like the ads you would see, you know, when you're on People Magazine, Peoplecom or CNN or Refinery29 or whatever. So a lot of creative that they're remixing across platforms here, whether it's on YouTube or these websites or in email we're going to talk about that or on their Facebook ads I think they have. I detected 93 ads currently live, so that gives you a little bit about their display ad business, and then their Facebook and Instagram. They currently have 16 ads live. My biggest takeaway on their paid Facebook Instagram stuff is how, like constant, they're refreshing these ads Like the longest running. They're literally launching new creative every week, I think. 

1:18:33 - Brian Becker
Yeah, I mean, from what I, what I see and read right now, you know we're definitely not experts on on paid media and Facebook and meta ads and things like that. It's like that's, that's, that is the meta. Now you know that if you're not, if you're not generating, you know five or six ads a week, you know you're, you're kind of falling behind, cause that's really what's what's working with the, with customers and the algorithm right now. So I'm not super surprised to hear that. 

1:18:58 - Will Evans
Yeah, yeah, I mean it's, you know it's. Sometimes you'll see like brands will have like there'll be refreshing, but then they'll have like a winning ad that they've just kept on for the like three or four months. You know. 

1:19:12 - Brian Becker
Yeah. 

1:19:13 - Will Evans
I think they're just killing it. Yeah, they just kill it and launch new stuff. So that's a little bit about their paid. I think what did I say? It only accounts for about 11% of their total traffic. Is that what it was? Paid is? Yeah, 10.85%. What else we got here we can move into organic? We kind of talked about this a little bit. So about 30% of their traffic is organic and I think Brian is right, like, how much of that is actually social? You know, that's really driving brand awareness or really even retargeting people, yeah, or keeping the brand relevant, um, but the top keywords are, you know, branded search terms elf, elf cosmetics, elf makeup this, you see this a lot with these big brands. 

A lot of times the top organic keywords are the same as the paid keywords. Most leads go to the homepage. Their top organic competition is Ulta, which is interesting because that is also one of their retail suppliers yeah. Nyx is one brand we talked about earlier that I think they really really compete with. Wet n Wild is sort of like a more lower cost provider, and then Maybelline is sort of a more legacy player. That's sort of positioned where they are at, sort of the high, high quality or higher quality and lower price point. Yeah. 

1:20:53 - Brian Becker
Just that came. Yeah, a couple of things you know, cause we don't? We have a, a gap in a way, in a way here of like how, how we are able to talk about organic traffic generation because of what we said before, there are so many top of funnel channels that are so difficult to track even for brands that have the data Think about it in terms of in-person events or physical ads in a metro area or things like that. And so there were just a few things that I wanted to cover that I think are definitely contributing. First would be their SEO. You know they have a huge, huge amount of content on their site. You know tutorials, you know different information about makeups, you know education pieces and things like that that have been going for a very long time and, honestly, I found one of the one of the breakdowns of them that they you know this is something that they've been doing for, you know, since like 2005, when they initially had um, had their, their their website up um. So that's one thing, and then you know there's a lot of other interesting kind of pieces that they've worked on. You know they've done like. You know they're doing like in-person activations, like there was one at Purdue University last year where they had like a maker-centric like thing, encouraging, you know, women to pursue STEM education. It was called like in my STEM era, you know, and so you're kind of talking about that and then getting boots on the ground, kind of sponsoring those types of things. You know they did an Amalfi Coast Beach Club pop up in July of last year, you know. So they're doing, they're doing a lot of different things to try. 

You know, we're seeing this constantly in the DTC and like CPG space now, where, how, however, you can find to put your, your product, where customers actually are, to, to establish that overall kind of awareness of what is uh, what's going on is uh, of the brand and the products and how it, how it could benefit, the, could benefit, the, the potential customer is really where a lot of brands are seeing success, and so it's so difficult to really say, like, where is this organic traffic coming from? How are people actually finding out about them? And so I think it's where it's. It's good to mention that they are doing a lot of content. They are doing a lot of like in-person activations, um, you know, the, the participation and trends which we'll, you know, we'll dive a little bit deeper into once we start to talk about content. But you know, a lot of this organic traffic is driven by the. You know stuff that is immeasurable at the end of the day. 

1:23:41 - Will Evans
Right, yeah, I mean it's. You know we'll dive into the social. I think a lot of it is in these campaigns that are running. It's just nonstop, is that? 

1:23:53 - Brian Becker
yeah, that's next. 

1:23:54 - Will Evans
Perfect, yeah, so let's, where do we even begin here? All right, so something, okay. So maybe we take a step back here, so something that I don't know if you, you, you, researched this, but something that came that I came across was you know, we talked about the CEO coming on in 2014. I forget when they IPO'd, but in 2018 sales went flat and but in 2019, they really they this was like one of the first brands to really embrace TikTok. You know, 2019, this seems like a decade ago now, but you know, back then TikTok was kind of more fringe. I'd say, you know, yeah, um, and what they did was the first thing they did. Did you hear about this? Eyes, lips, face, tik TOK campaign. 

1:24:54 - Brian Becker
Yeah, 2019. Yeah yeah. 

1:24:56 - Will Evans
So this was sort of the first thing there, was they literally there's a song about this, uh. And then people just started filming themselves doing the eyes, lips, face and uh. And then they got like celebrities to do it totally unpaid for. I mean, like like Reese Witherspoon did it, I think Ellen DeGeneres did it, um, and this this got. I think it got like something like 7 billion views or something, um, and I mean, just talk about the brand awareness that creates. 

1:25:28 - Brian Becker
Yeah, yeah. And they and they continue to create trends, follow trends, participate in trends and then ultimately which I think is the most genius part is capitalize on those trends by creating products around them. It's something that when we look at their onsite, they even talk about that on their product pages and on their product images. They'll have like a little tab on there that says like went viral. You know it's so innately built into who they are. You know a ton of their. You know they have affiliates and influencer partnerships. They're creating content all the time, while also, you know, next to the ads and things like that they are. 

This is really where this top of funnel, you know awareness is being created and they they honestly, have kind of pioneered this in a way, especially around the TikTok. You know, in the TikTok sphere and and how they and how they've kind of jumped on with being relevant in that space. You know we see it a lot with like UGC too, like it's a great place to then get others to give their endorsement to whatever the product is, whether it's paid or not. You have plenty of people that are doing their get ready with me's and all this kind of stuff, that are featuring these different products, and so participating there just like allows you to have this bank of content that, even if it's not, you know, fully produced and what you want. You have these really authentic experiences that are being shared over social. So yeah, they have crushed it here. 

1:27:09 - Will Evans
So, yeah, they have crushed it here. Yeah, I mean. One thing that I think is interesting too, to bring up your point is it's not a lot of these brands, especially these more newer age challenger brands that we talked about in the beauty space we talked about literally Kylie Jenner, selena Gomez, rihanna, like they're all celebrity based. You know they're using that mostly celebrity most of the especially to kickstart the brand, get the brand started. They're using that celebrity's influence and reach to to drive traffic and sales. Um and Elf is doing some of that, but a lot of it is more like micro influencers, maybe even nano influencers you would say Um, I think, like, oh, a majority of their partnerships with, with, uh, you know people that they're they're influencers or they're're influencers or they're ambassadors or whatever, are actually micro -influencers, not these mega-influencers. 

1:28:18 - Brian Becker
Yeah, as you know, the CEO has said, they're looking to make actual connections with the people that are pushing the industry forward. I think that's really relevant in what they do. Yeah, and I think that that allows you to. You know, I think a lot of the content that they create ends up being very well produced. 

You know, like these, some of the features here, like this elf von Zen, the scientist guy, like you know that, and so elf in german means 11, um, and so like 11 out of 10 is kind of like the whole tagline of elf von zen, which I guess was being said about the products in um in germany, as, like you know, wordplay, and they turned it into a whole campaign where it's all in german and they have like a guy getting ready to go to like a techno club, putting on his makeup, and then they have they're in the lab, like pretending he's in a techno club, and then like measuring his makeup and they're like, oh, you know what's the, what's the result, and it's like it's an 11 out of 10, you know is being shared and there's multiple of these. 

There's a lot of different characters, a lot of different. 

You know the Meghan Trainor stuff and the football stuff, and there's a lot of stuff happening where they're putting a lot of money into this, because they're able to kind of toe the line between the really authentic content from the UGC and from the authentic experiences and the get ready with me stuff and then pair it with, you know, this funny, irreverent, you know, produced entertainment style content as well, and so they're just kind of across the board, really really leaning into entertainment, you know, because at the end of the day, that's what it is. Even a lot of the tutorials and things like that, that's entertainment for people, rather than just like trying to figure out how to do something new. It's more like this is something I watch, you know, as I'm chilling, hanging out or going to bed or whatever. And so there's there, there, this is a truly digitally native brand, one that really, really understands social media, and if there are other brands that are looking to create by our virality, this is, this is the playbook to follow, this is the brand to study, in my opinion. 

1:30:32 - Will Evans
Right, cool, okay, anything else on social. 

1:30:36 - Brian Becker
Let's keep going. 

1:30:37 - Will Evans
Okay, what do we got next here on site? Okay, so let's actually pull up the, the breakdown here so again, you can download this. We'll go through the website here and then we'll pull it up in real time as well so we can refer to it. Of cosmetics, um. So we talked about how they're driving traffic, um, and we talked about how most of them land on the homepage. So that's the top homepage, that's the top site. It's interesting. 

It's hard for me to know the exact flow here because we don't have access to that sort of data, but it feels like to me, like they're sending people a lot of time to a collection page. It's not always a um, a like product page per se, and you can kind of see this where it says shop here and it pulls this up. You know, bestsellers, what's trending? Um, it's kind of cool how their brand is literally the categories. I guess that's that's pretty good branding too. And you know, moving past that, the product pages themselves are let's go to one of their best sellers here We'll click on. Let's go to this primer, cause I know this primer sells really well. Um, is there anything that stood out to you on their product pages? 

1:32:18 - Brian Becker
So I mentioned this before the um the gone viral tags there. 

1:32:24 - Will Evans
Yeah. 

1:32:24 - Brian Becker
You know, and then they also have they they use. They do a good job of really working with urgency and uh scarcity. On some of them there are, you know, tags that say how many have been sold in the last you know amount of time. It looks like this doesn't have one here, but there's um, there's a lot of you know they're. They're very optimized for CRO, um, you know, this is another product that makes a lot of sense for uh, for subscriptions too. Um, you know, honestly, I was kind of surprised that they have an after pay uh option, just with how low their price points are. Um, but that was you know. Obviously, they, they offer that too. I think it's just cause it's standard in terms of the um, in terms of the, the industry. But, uh, yeah, I think, as far as the actual product pages go and whatnot, it's pretty straightforward. They do a lot. Here's the trending now. Yeah, trending now. They do a lot of different offers on the site as well. You know there's a lot of Today's offers. 

1:33:27 - Will Evans
did you see this? 

1:33:28 - Brian Becker
Yeah. 

1:33:30 - Will Evans
Yeah, this is cool. 

1:33:33 - Brian Becker
So being able to do that and I'm assuming you are qualified and cookied for your free shipping and $8 off your first order up there, so your code is already populating at the top of your screen they have this get three free gifts. Grip it and go join the beauty squad. There's a lot going on in terms of offers, so I would assume that they drive a lot of engagement through the different offers, which makes sense when you have a brand that is so price point driven that people are looking for deals and so when they get here and they already know that it's that, it's you know, a cheaper product they're probably looking to to buy even more. If they can get it, get it cheaper. 

And then I actually went through a chat with their beauty advisors down there. I'm not sure I really couldn't tell if it was a, if it was a human or an AI. It was really really well responsive and just kind of went through a chat with them and they got a lot of help, got product recommendations, recommendations, um, and so yeah, I think it's a. It's a good, very, very well done as far as the actual uh like help you can get on the site, because sometimes it's just like you can tell, it's ai responses that are referring to a database. This actually seemed like you could get beauty tips if you needed to yeah, it looks like they're transferring me to a beauty advisor. 

1:35:08 - Will Evans
They've kind of humanized it. Who knows again if it's actual ai or not? Yeah, looks like they're transferring me to a beauty advisor. They've kind of humanized it. Who knows again if it's? 

1:35:12 - Brian Becker
actual AI or not. 

1:35:12 - Will Evans
Yeah, looks like Angie came on and yeah, to follow up to your point, they are, you know, like a lot of brands would not lean into this, you know. But because price is part of their positioning, x being accessible is part of their positioning they can really lean into. Hey, here's the offers today. I thought this was cool. I haven't seen people do this. I love how they have these offers here. 

We're going to talk about this beauty squad, because I think that's something interesting they do. It seems like they're just rotating, like I was looking at it this morning. This wasn't even online Grip it and go. This is a new one. So, yeah, what else stands out on site? I mean, we talked about the scarcity, about the scarcity Moving into the cart. Nothing crazy here. If you were to add a cart, they do make you go, or they call it the bag, whatever. Same thing. They do make you go two steps here. So they have like the little Ajax slide out and then you actually go into a cart and then you go into the checkout. And again, we talked about they're using Salesforce Commerce Cloud here. 

Just following through with the order, the thank you page was interesting. I've never seen a thank you page like this, um, where it was like SMS opt-in after the checkout, um, and there was like a little button that popped up here and I could do that. I just wondered, like the adoption on that, how high that is. And then the beauty squad they're just pushing that like nonstop. But that's a little bit about the ordering experience. I don't know what else do we have on site before we move on. I know we're going to talk about their emails and their flows and their funnels, so I'll wait to dive into that. Um, we didn't talk about the opt-in. Did you take a look at that? 

1:37:34 - Brian Becker
Yeah, I did. Um, it's pretty straightforward. I mean, it's hard with a, with a product like this, to really get a deal that is that makes economic sense. But you know they're going with the $8 in free shipping. Um, you know, only email required. They don't force you into the SMS funnel like a lot of brands do. It's an option. But you can just take the $8 off. I love that they populated at the top of the screen. They actually don't even send the coupon code in the email. I don't know if you noticed that. 

1:38:06 - Will Evans
Yeah, they reuse this email everywhere. Yeah, this reuse this email everywhere. 

1:38:10 - Brian Becker
Yeah, yeah. 

1:38:11 - Will Evans
This welcome email. But what's interesting is and I think you had already teased this how they're dynamically. Did I lose it? They're dynamically using this coupon code everywhere. Yeah, and this might be something. I'm not actually totally sure how you would do this in Klaviyo. I think you can do some of this, but this might be the personalization that you just might be able to get with the granularity with the Braze Salesforce tech stack. Like they're literally um, again, it's a dynamic coupon code on the thank you page. Um, it's a dynamic coupon code in the header right. 

1:38:59 - Brian Becker
Yeah. 

1:39:00 - Will Evans
Okay, that's pretty cool. They're also doing it in the, the newsletters too, like after I go through the pre-purchase flow, uh, or I get the. Well, I don't know if that, like here you'll see, like this is a newsletter, they're sending out, um, and they're dynamically changing this box. 

1:39:23 - Brian Becker
Yeah. 

1:39:23 - Will Evans
If you are a, like if you were in the cohort or segment of, you've never placed an order before, then you will dynamically get this box. If you've already placed an order but you haven't joined the beauty squad, then you will get joined the beauty squad and then I don't know what they do. If you've already placed an order, you've already joined the beauty squad. That probably should be my next investigation, but that's, that's pretty advanced, Brian. 

1:39:52 - Brian Becker
Yeah, yeah, there's a lot. There's a lot going on in terms of really thinking about the journey and what the next thing is that you want somebody to do. That's always and as that should always be, the focus, right. You know, when you're a non-buyer, you want somebody to become a buyer and once they're a buyer, you want them to be more incentivized to become a repeat purchaser. So for them, they probably see that people that join beauty squad end up purchasing X, y, z amount more times. Um, and so it's there. You know it's, it's very clear what their, what their incentives are at each stage versus the purchase using the, using the discount, and then it's joining the beauty squad. And this is something we talk about really frequently, of what email should really be about, or what your engagement on site should really be about is the desired next action. You know what is the pathway to that desired next action and everything should be working in tandem to achieve that next action. Which should be working in tandem to achieve that next action which you know is kind of in our wheelhouse and our area of expertise, because a lot of that is done through email and a lot of that is done through the journeys that you're sending people through. But yeah, just a couple of things as we wrap up. 

On site, you know there's a lot of content features on there too. They feature a lot of like the Meghan Trainor stuff is on there. There's like the Alphonse N stuff on there. You know they still really use that content as web content as well. You know, on their homepage they have their their. Whatever is running on social is also running on the site too, right, and then they also, you know they have a massive content library. You know they're. They have all of the Discover stuff. There's a ton of blog posts and their tutorials and whatnot. And then the whole Elf Cares section was something that I thought was interesting too. This is where they have a lot of their like their social kind of goals. You know, and this is did you the? Did you see their content? There was a this we're changing the board game. 

1:41:59 - Will Evans
Yeah. 

1:42:00 - Brian Becker
So this is you know. There's a few different things in here, but talking about, you know, the representation amongst boards. 

1:42:07 - Will Evans
Oh, they're actually putting this on their site because I saw this stat. I mentioned it earlier. They buried it though it was like something their CFO mentioned, but it's cool to see that they're elevating this on their site. 

1:42:18 - Brian Becker
Yeah, go to learn more there, because they've got some great content and some really good angles in here as well. If you scroll down a bit, the one that you might have seen before is like so Many Dicks, where it's basically that one. Yeah, so it's like there's more people named Richard on publicly traded boards than there are of everyone all other diverse people. So you know it's a. It was a very interesting analysis of of, you know, inequality amongst, you know, corporate boards in America. 

1:43:03 - Will Evans
Yeah, yeah, I mean I. I mean this comes back to the whole diversity and inclusion that we were talking about Like they really own it. Yeah, it's not just like cause, you know I, you know I'm a big fan of reading these annual reports, these quarterly reports, it's. You know I'm like why is Blackstone or BlackRock or whatever, talking about diversity and equity and inclusion? You know, yeah, it's like, do you really care? Like, do you really like, do you really really care? 

you know, um, elf, like they really, really care about it. Yeah, um, it's cool. Um, yeah, and there's, this is their board right here. Yeah, um, what else on site? Uh, let's talk about the beauty squad. This is like their loyalty program, I guess, but it's so much more. Um, you know, when I looked at it, like everything comes back to this, um, you know, one of the coolest things I found about this brian was that you can get rewards from your actual anywhere you buy retail transit yeah, yeah, I thought that was awesome too yeah, um, there's contra. 

There's like controversies about loyalty. I've heard you know in my general opinion is like most of them kind of suck. You know, like your standard loyalty program that you use Yacht if you're a D2C store. You're just going to roll out like a generic loyalty program with, like one of these apps. You know like it's not really that good but the ones that do it really well, like it can be a game changer for them, yeah, yeah, I think that they have the ability to do it and they've really nailed it here. 

1:45:04 - Brian Becker
You know those. These are the kind of like dream features that I think people want in a, in a, you know, loyalty program, and the fact that they're able to do it, as they have the, the, the scale to make something like this happen. 

1:45:19 - Will Evans
Yeah, yeah, so you get points free products. 

1:45:24 - Brian Becker
birthday gift yeah. 

1:45:25 - Will Evans
Yeah, when you log in you can see the the amount of points you have, which is, you know, if you're your standard small business mid market Shopify store can do that with these apps, but for a business like this, that's in the enterprise, publicly traded company, using more, more enterprise tech stack apps, that's actually I have to give the tip of my hat to that they're able to be this personalized at this level of scale for a 20-year-old company, Agreed, yeah, this is definitely a highlight of their business and a great. 

1:46:02 - Brian Becker
You know, when we talk about what can people take from brands, when they're looking at this and like, what can I implement? This is something that is worth a deep dive in itself, of like, how is this happening? How is it possible? But you know, my guess is that it's a lot of it's that's difficult to find and there's a lot of custom work going into how they're able to scan receipts and give you loyalty points for, you know, your purchase at Target. 

1:46:25 - Will Evans
Yeah, I think this playbook is great for people that definitely want to scale. Maybe you work at an e-commerce store and you want to scale into the buildings, but I think, honestly, if you are working at Unilever or Procter Gamble or one of these massive CP&G holding companies, this is the playbook for you too these massive cp and g holding companies. This is the playbook for you too. You know like this is how you should run one of these billion dollar portfolio companies. 

Portfolio brands yeah they're very nimble, um, they jump on these trends really quickly, uh, and they, they execute. Uh, they move very fast and they execute well, something that I have not seen. Necessarily those types of brands. All right, what else are we talking about here? So is there anything else on site? 

1:47:21 - Brian Becker
No, let's jump into emails and talk about their flows and campaigns. 

1:47:25 - Will Evans
Okay, let me pull up our. So we have the emails. Why don't you start talking about the emails while I pull up our email? 

1:47:39 - Brian Becker
guide. Yeah, so this is. You know I love seeing this. This is a textbook example of really well put together design systems, consistent visual language and efficiency and scalability. So if you look here, you know I pulled out some examples of all three of these text blocks are similar headline, they have the same style of body text, same style of button and CTA there. Then you'll see these kind of hero images. All are similarly designed as well. They have you know product feature image with, you know this accompanying text and the arrow kind of pointing to whatever they're talking about and you know. And then the next ones. These are more like category or product images as well that are using the same design in terms of these like new bubbles or the you know bestseller kind of call outs there. 

And what gets me so excited about this and why I care and why I think you should care, is that this is what allows them to send as many emails as they do. Again, I'm going to say this is how we talk to brands all the time that want to do 25 campaigns per month and they want to do this and this and this and this. All of that is great. I want to help you guys send 25 campaigns per month, but the thing is is you cannot send 25 completely new, completely bespoke emails per month, unless you want to have a five person team that's dedicated just to doing that, and because they quit, three months later. 

Right Because they're burnt out on trying to come up with 25 individual campaign ideas every single month. And so this is how you do it at scale. You choose different campaign segments that make sense to you, such as a testimonial, a product feature, community engagement, celeb or content feature, viral on TikTok, new revivals, whatever it is that you're going to repeat over and over again, and you make sure that you have blocks that are easily changeable, easy to update, easy to stay consistent with. And then all of a sudden, it changes from it being a four-hour engagement to trying to get a new email together to a half-hour thing of writing the new copy, grabbing the right images, getting it sent over to the designer to kind of like spruce it up, and you're ready to send it. And so this is a super dialed-in email design system. There are tons of repeated blocks all through the entire thing. They pretty much only use one template for all of their emails. There's very little, you know, changes between what they're doing and this is what is going to push. This is what pushes their campaigns and allows them to be essentially prolific in the amount that they are sending. 

And you know I harp on this all the time, and you know I guess one thing to say is like, if it's good enough for a billion dollar company, it is good enough for, you know, the 5, 10, 15, 20 million dollar brands that are trying to replicate this type of success. And it just shows that the focus here, just like with their branding, just like with their product creation, is on the business. The focus is on the actual efficiency and scalability. And how do we get this momentum moving and keep the momentum going? By using systems that are going to allow you to to scale faster, and you know it's so. I never miss an opportunity to talk about campaign angles and to email design systems, because that, I think, is a secret that I, that not many people really fully understand how much, how much time that reduces in the in the creation process. 

1:51:29 - Will Evans
Yeah, I mean I think that what you see I mean there's so much there that Brian just mentioned. I mean the biggest thing that I see is, you know, elf is sending like 30 emails a month. That's like pretty high, that's like almost an email a day. Sometimes they're sending multiple emails a day, um, and you know a lot of these brands that we that we break down are doing like 20 plus 15 plus a month, um, and even that is challenging and I think where it just depends on where your brand's at, if you're a brand that is struggling to get campaigns out and let's back up for a second Like the reason they're doing these 30 plus cents a month is probably because it's driving revenue. Okay, you know it's probably not their most number one channel, but I bet it's driving a lot of e-commerce revenue for them and it's worth it to do these emails every day. 

But the catch-22, I guess it is like a challenging workflow sometimes and once you reach scale, it's hard to rely on agencies to do it and you also have to have things dialed in if you're going to move it in-house. And my guess is they have moved this in-house and it's pretty dialed in with what Brian was saying, and we can pull it up here I got the month of September last year. That's probably a good month to go into before Black Friday and Cyber Monday and all that. But when Brian is talking about email design system and stuff like this, you'll see nothing is really changing much here across. I mean, I guess thematically nothing is changing that much. 

1:53:30 - Brian Becker
Yeah, you want to switch over to sharing that tab. 

1:53:33 - Will Evans
Oh yeah, I'm not even doing it, my bad. So this is the month of September last year. You know like the logo is pretty much the same every time. They're basically changing out the hero every single time. I think these are image blocks. I'm not sure they're basically changing out the hero every single time. I think these are image blocks. I'm not sure you know they're using this 100 beauty squad, like they mentioned, the beauty squad in every single email. And again, I don't know if this is dynamic or but every email is the same block, so you don't need to go to your designer every time you do a send and be like, hey, I need a new beauty squad block, you're just dragging it over. Yeah, and again, that just saves so much time on the workflow look at how basic those, uh, the product blocks are. 

Yeah, that's like that almost looks like a stock product block these are just stock dynamic product blocks here, probably from braze or salesforce or whatever. Um know, it's the same footer every single time. It's the same bottom navigation. Every single time the same. Don't forget, upload your receipt from Amazon. All they're doing is changing out this creative. You know the subject line. Maybe they have to change the segments, you know, and then they go through quality control. Probably that's it. 

1:54:55 - Brian Becker
Yeah, I mean, look at this email, these two right here. They go undercover and you need a new lippy. So this, let's scroll through these emails real fast, so the exact same email. 

1:55:05 - Will Evans
Yeah, keep going. 

1:55:07 - Brian Becker
But even more so than that. So it's the exact same email with different images. Keep going, keep going. There is not one thing in this email that if I had access to elf's email their esp me today, having no idea their strategy or anything like that I could create this email in a half hour, because it's just images that they're pulling from their brand book. It's just copy that has already probably been written somewhere else. It's just. Every single bit of this is just switching out email, switching out images and switching out copy to be able to produce this email. 

There's nothing crazy going on and this is what people really really have gotten to. You know are starting to. They miss the point here. You know it really I feel like it goes over so many you know brand owners or you know founders or you know execs heads is that it does not need to be complex. 

It needs to be simple. It needs to be the easiest, easiest process in the world, because that is where you can actually develop a baseline for performance, understand how things affect the revenue that you're generating through emails and change from there. So if you don't, if you can't already operate at sending four or five emails a week very efficiently at that base level, there's no reason for you to start testing other. You know AB testing this, that and the other, and you know there's no reason for that until you can really work the workflow, because that is the most important part. That's where the profitability comes in. It doesn't matter if you make $100,000 a month sending 30 emails a week, if you're spending 90k trying to get it out the door. 

You know, and so that's really what it comes down to is how do you make this an efficient process that supports your business goals rather than, you know, gunking up this whole mechanism and making it just a pain in the ass at the end of the day? So they're a great example of that. We've talked about others, like Huel. That's another really, really good brand the meal replacement that does similar email to this. Yeti has similar emails to this as well. Again, we were able to pull out five, six, seven, eight emails that are exactly the same that get sent every single month. Um, and it's, it's. This is the way to go if you want to really find a way to to scale with email. 

1:57:41 - Will Evans
Yeah, I mean it's, it's, this is image on image on image on image. That's. You know this takes, you know, and again they're probably using this creative across channels, you know. So, again, like Brian said, like you don't need, you can be a billion dollar industry. You don't need this a billion dollar company. You don't need some like crazy email marketing flow workflow. You know what you need is to just get stuff out the door workflow. You know what you need is to just get stuff out the door. So we talked. There's a couple other things on the campaigns that I think are worth talking about. These are the flows. We'll talk about that next. Another thing we didn't talk about was the angles, and when we say angles, these are like the theme of the email maybe, and you can come back to these angles all the time you need to find multiple angles in your business and Elf does this very well. 

They come back to these angles like, for example, viral on TikTok. I think every single week they have an email that's viral on TikTok and they did this for all of 2024. Like, if you look at, where was it Right here, I mean literally, we were just talking about it Like viral on TikTok. Here we go, Four ways to find your glow, Viral on TikTok. And then, I think, the next week it's the same thing, it's the same create. Like they know they're going to do this every week and you can see that the artwork is very similar. You know, for between that email it's the same. Maybe they changed the background, but it's the same font, the same style of color of font, the same sort of. You know all they're really doing. 

The designer just has to come in and quickly change some things out and maybe takes them like 10 minutes you know and so, like that's another thing you know find these angles that you can reproduce in your business, week in and week out, in your email campaign strategy. Elf is a good example of that. Actually, there's all sorts of angles. We're not going to dive into that, but this is the first time I've ever seen a viral on TikTok angle. But when you're a brand like this that literally is living and breathing off virality, like you can get away with it. 

2:00:06 - Brian Becker
Yeah, and you know not to harp on it too much, but think about how quickly that campaign probably gets approved, you know, cause that's really what. 

That's what starts to matter now when we get to this level of of uh you know email marketing. It's not about coming up with the idea, it's not about what image is used, or it's about the workflow and approval process. Who needs to look at this and sign off on it and make sure that it gets out on time? Because that's really what the marketing manager or director of retention whatever their KPIs are are always tied to the revenue and how it's actually performing as a channel. But so many teams get blocked by having revision after revision after revision. And when you have something like that, like that viral on TikTok layout, wherever we know what it is, we're already essentially pre-approved to send this email out. We just need to make sure that the content is updated, and so it ends up being something that like, hey, will, I've got the viral on TikTok email ready for this week. You jump in there, look at it. You're like, okay, good to go. 

2:01:13 - Will Evans
I for this week. You jump in there and look at it. You're like, okay, good to go. I already know what I'm expecting from a viral on TikTok email. It looks like what I'm expecting, let's send it out, yeah. So yeah, I mean that's you know. Find these angles in your own business. I mean some other ones that they have that are the viral on TikTok was the one that really stood out to me. But every collab, I mean that's easy, you know like they're doing. 

They did collabs with like what do we add? You know, tinder was one we just saw. 

2:01:36 - Brian Becker
Yeah. 

2:01:40 - Will Evans
You talked about one on Liquid Death. I think they did some other ones, like with American Eagle. They did one with Chipotle. You know, and this is a playbook a lot of brands are doing. You know, and this is a playbook a lot of brands are doing. But you know, every single collab has a campaign that goes along with it, has a Facebook ad that goes along with it, has a display ad that goes along with it, has something on the site that goes along with it. Maybe there's a dynamic block in the flows that goes. You know, this is like how these high value big brands operate that can actually execute, yeah, yeah. What else do we have on campaigns? I mean, we talked about the dynamic blocks they were using on the coupon codes. Yeah, we went through the beauty squad. Yeah, I mean, well done here. You know it doesn't need to be this. You know this is not going to win, like awards for email design, but I bet this drives a ton of revenue. 

2:02:40 - Brian Becker
Awards, don't pay the bills. 

2:02:42 - Will Evans
Awards. Don't pay the bills, yeah. 

2:02:44 - Brian Becker
Yeah, there's, there's not a lot to talk about because it's a simple strategy. Yeah, and that is the key here, when you hit this level, is simplicity, simple scales baby Simple scales Okay. 

2:02:58 - Will Evans
Let's move into flows, all right. So I talked about Braze. They're using Braze for SMS email flows, email campaigns, I would imagine too Single opt-in. So if you don't know what I'm talking about, when you opt in on the pre-purchase flow or in the abandoned checkout or something like that, or on their site in like a footer you opt in right away, you don't need to go back and go back to your inbox and confirm that you meant to opt in here. 

You see a lot of these bigger brands do that for a variety of reasons. Sometimes they just don't even know the difference between double opt-in and single opt-in. But the ones that are more dialed in, maybe they have hackers coming in. They need to protect the brand. But without single opt-in, the flows that I observed I'm not saying these are the only flows they have, but these are the ones that I observed was the pre-purchase flow, the browse abandonment flow. They had transactional emails and they had a post-purchase and we can dive into that in a second. Is there anything that you noticed from their flows, brian? 

2:04:11 - Brian Becker
No, I was, you know. Just an observation, though, is that they have a really heavy campaign load, which to me, you know, sometimes signals that and I've noticed this with other beauty brands, ones that we've worked with too, where we've kind of overhauled their entire flow strategy, because they kind of get into this rhythm of just sending a campaign a day that they don't really focus on flows, because that's kind of filling the pipeline of what? Of the purchases that they need, and so, you know I would be of the purchases that they need, and so, you know I would be, I wouldn't be that surprised if they have a little bit of a thin flow strategy. From what I saw, you know, I opted in in multiple places with, you know, different extensions on my email, and I got the same email every time. You know the I wouldn't be surprised if, if they just rely more on on their campaigns in general. 

The other side of this is that I'm sure email is a is a decent driver, but they are not necessarily, you know it's not, it's not the Gen Z way or the Gen Alpha way to be you to be really email heavy. This isn't people that are checking their emails all the time, and I don't know if this is really their primary channel for even re-engagement and retargeting. But yeah, let's jump in and look at it a little bit. But I do think that for me, I think they probably win with their campaigns because it's a little bit faster, a little bit more. For me, I think they probably win with their campaigns because it's a little bit faster, a little bit more. You know it keeps up with their. The reason that it's so important is that there's so much trendy you know content that they're doing that you can't keep your flows fresh enough, so they probably just have something in place that you know hits the hits, the mark on what they need. But then they do more of the heavy lifting with their campaigns. 

2:06:16 - Will Evans
Yeah, great points. Yeah, I mean that makes a lot of sense. Yeah, I mean we have seen that a lot of these Gen Z brands, gen Alpha, like email, is less important. I mean I think that's a really good observation that, yeah, because things are moving so fast that it's hard to keep your flows up to date and they just use the campaigns to do that. 

2:06:31 - Brian Becker
Yeah, if you're selling you know appliances, you know refrigerators and you know ranges and things like that, sure it makes sense to have really extensive, you know, because it's a high purchase point and you know it's not changing that often. But if you're selling six, seven $8 products that are there's a new viral one every week you're going to want to be a little bit more agile and nimble, and so there there's probably more emphasis on on the campaigns. 

2:06:57 - Will Evans
Right, let's pull up a, let's just go through some of the flows real quick, though Cool, I have it pulled up in the funnel breakdown here. So we kind of already went through the pre-purchase flow. I think this is the browse, but you know, again it's hard for us because we don't have access to it and we're just sort of guessing. This is what I think the browse abandonment flow was. Honestly, I was a little unimpressed with it. Very basic, you know. The subject line was something around me, viewing products, which is interesting, and they're just sort of, uh, replicating the same email like don't forget, or you know, they just basically change the copy, um, the, the copy at the top. You know, I think it's the same. 

Yeah, they just basically use the same image and they change it Um well, this is a good place to say um. 

2:07:59 - Brian Becker
If anyone from elf is watching and you do want to improve your flow strategy, please feel free to reach out to us at Flow Candy. We're happy to help. 

2:08:13 - Will Evans
Yeah, that's the plug. But yeah, I mean, I do think this is probably works in terms of revenue. You know, this looks like a three email browse abandonment flow. It yeah, I mean like it's very vanilla but it could be elevated a little bit. No-transcript it's like clear that I would, that I abandoned the checkout, um, but I never got one. So, but maybe there's not to say that there is one. But if there isn't, like I would recommend, I understand when some brands might not want that. You know, like I think Liquid Death didn't have an abandoned checkout flow, but for them to have a browse abandoned flow and not have an abandoned checkout flow is a bit weird. But again, like, take it with a grain of salt because they might actually have one. Let's see. Let's dive into transactional Nothing crazy here. So this is another strategy that you can use. So they're going to repurpose this. 

Welcome to Elf email all over the place. This is pre-purchase email number one. It's transactional email number one. It might even be the abandoned checkout. I might have gotten this as abandonedurchase email number one. It's transactional email number one. It might even be the abandoned checkout. 

I might have gotten this as abandoned checkout flow email maybe, uh, but uh, but um, you know. Coming back to your point, brian, nothing crazy here. Yeah, this isn't like it's all. 

2:10:05 - Brian Becker
Evergreen is really what it comes down to. It's the only stuff that they can really keep on there is like evergreen, hey, we're always. You know four. It's the only stuff that they can really keep on there as like evergreen, hey, we're always, you know, for reasons to shop. You know we have an app. You know, join the beauty squad. So it's like that. That makes sense. Here's some best sellers yeah, we got the. 

2:10:26 - Will Evans
These are the transactional emails. I mean very basic, doing a little bit of selling cross-selling down here. So that was the order notification. This is the shipping notification, and then this was the I don't. I think that's it. I don't even think they had a delivery notification. Outside of that, they did do some post-purchase stuff. This is confirmed and they might be reusing this. And I don't know if the logic is crazy here, but at the time I don't think I was a member of the beauty squad, so I got this email saying to join the beauty squad. 

Um, and it kind of goes over some of the stuff we talked about earlier when we broke down the beauty squad. 

2:11:15 - Brian Becker
Yeah, Um, the one flow that I would be curious if you end up getting. When did, when did you order like two weeks ago, a week ago? 

2:11:24 - Will Evans
Yeah, february 3rd. 

2:11:26 - Brian Becker
Yeah, so you know, depending on, I would guess that their lapse period for a product like this be somewhere around like 45 days. I don't know how frequently makeup is used, to be honest, so like a win back or replenishment flow a replenishment or like a subscription upsell. 

Since they have so many, they have subscription available for so many of these products. And there are certain things I think that you know people that are using these products on a consistent basis would put on subscription. So I'm wondering if there is flows around there. You know people that are using these products on a consistent basis would put on subscription, so I'm wondering if there is flows around there. You know, like we said, it's always tough to really like suss out exactly what's going on, but that is one strategy I think that would would benefit them as some sort of replenishment slash, subscription upsell. Start with trying to get people on to the subscription and, if not, you know, sell them on the one one time purchase replenishment and then that goes into, you know, subscription cancellation and all that kind of process as well. Um, have you gotten any reviews? Or ugc emails like, hey, leave us a review. Or hey, you know, make a video of our, of our products I don't think I got any of that either. 

2:12:29 - Will Evans
Okay, because that's definitely something that they should be doing, since they they thrive off of that either. 

2:12:32 - Brian Becker
Okay, because that's definitely something that they should be doing, since they thrive off of that. It's just like, hey, make a video and share it on TikTok and use this hashtag yeah, let me just pull it up. 

2:12:42 - Will Evans
I mean, I think most of the stuff I've been getting is newsletters. Yeah, I don't think there's any ugc stuff, nope yeah, yeah, I ordered I ordered on uh third, so it's been. You know it's been about 10 days, so maybe it'll come. Yeah, you know, generally those emails in the post-purchase come after two weeks or maybe 10 days. 

2:13:18 - Brian Becker
Yeah, it takes a little while. So, yeah, this almost doesn't even look like a post-purchase flow and it's more of just a join the beauty squad flow. 

2:13:31 - Will Evans
Yeah, they want to get the birthday. That's like definitely one of the zero party sort of a zero party data thing they're trying to collect on you. Um, that just you know, probably because when it's your birthday they'll send. There's probably some happy birthday flow or something. 

2:13:49 - Brian Becker
So you get a. I think you get a free gift free gift. 

2:13:54 - Will Evans
Free gift, yeah um, this was cool uh, here we go, they got. 

2:13:59 - Brian Becker
Is this not a? 

2:14:01 - Will Evans
this is more. I don't know if it's like a replenishment flow. It's more of like a hey, because this is what I ordered. I ordered the, the bronzer and contour okay uh, you can't, can't tell. 

I put it on my face, you know, interesting, because it's kind of like a it's. The angle here to me would be like okay, this is the product you have, like let's educate you on that product, but I'm not sure that's actually what they did. Let me see if I can pull up that exact email. What is it? Elfing obsessed? Um, yeah, great, great elfing choice. I do like how they use that in their branding, yeah, and then they just send me back to a category page which is interesting. Okay, it's kind of a weird one, you know. 

2:15:08 - Brian Becker
Yeah, it seems like it looked like it would be a testimonial or like ugc request. 

2:15:14 - Will Evans
You know um no, yeah, it should, it's. It's weird because this is clearly a dynamic block, you know, and the subject line is dynamic great up and choice. 

2:15:26 - Brian Becker
You'll be obsessed with product name yeah you know, can I yeah, Can I see the rest of the email? Huh yeah, Very odd email. Yeah, I think their flow strategy is definitely all over the place. It seems like we're getting stuff out of order. We don't really know what order it's coming in and what the logic is behind all of them. But there's definitely some room, I think, for improvement, honestly, of all the stuff we've seen Um. But there's definitely some room, I think, for improvement, honestly, of all the stuff we've seen Um. But then again, we don't know what their revenue split looks like on on email and if it's even a priority for them, it might be too small to even like be worried about right now. 

2:16:03 - Will Evans
Yeah, um, but anyway, okay. So that's what I saw in the post purchase. I don't, I think that's it. Yeah, Um, we already went over. I don't think there's any more flows. Yeah. 

2:16:14 - Brian Becker
Well, while you're there, let's finish your journey. Let's talk about the unboxing. What that looked like for you? Anything special? 

2:16:22 - Will Evans
Oh yeah, unboxing, Nothing crazy. I ordered a small product, just one. The packaging was branded, which is kind of cool, yeah, um, you'll see, like you're. You know, uh, you tend like I ordered something from finty and I've ordered something from rare. You know two premium brands, but I don't think I think rares actually was pretty, pretty elevated, but finty's definitely was not. Um, you know, like finties would like the, the po said it came from like fulfillment or something you know, like some of these brands. Uh, nothing crazy here, just sort of a bubble wrap around the product I ordered. And then we have the camo, the camo liquid bronze so exactly, yeah, and that's that. 

2:17:11 - Brian Becker
That's a shelf, a shelf box as well. 

2:17:13 - Will Evans
So, like you can see, the this is like what I've got it right here. 

2:17:16 - Brian Becker
You can see the eye hole there on the top as well, Like that goes straight onto a you know target shelf. Yeah, so yeah, nothing special about the boxing or anything like that. Okay, cool. 

2:17:28 - Will Evans
Yeah. So that's the basic flow, and then we've already talked about some of the newsletters. We should move on. Yeah, let's talk about Amazon. Amazon was interesting to me. I don't know if you want to kick it off or me. No, go for it, yeah. 

So I think that what's interesting about Amazon from my perspective, with Elf and something that I think is a little bit different, some of the other makeup, elf cosmetics and that is true with amazon too, like a lot of people, are using those search terms, but they are also ranking very, very highly for non-branded terms, like ranking organically. They rank number one for lip oil. Their primer, which is another one of their top sellers, ranks number three on all of Amazon for just the term makeup, and they rank number one. If you just search primer, they rank number one, two and three organically. They have three listings that rank organically. I'm not talking about the sponsored ads, I'm talking about what actually pops up. So I found that very interesting. That's kind of that. That that's kind of cool, that that they are, um, that they, that they have, that I forget the terms for that, but uh, you know that that they're. They're not just. They're driving sales, not just from the brand. 

2:19:24 - Brian Becker
Here I feel like yeah, no, they're very um, they're optimized as far as the like. You know SEO and the keywords and you know reviews and it's a very well optimized. You know Amazon pages. 

2:19:39 - Will Evans
Part of it is the price point too, the accessibility. You know it's hard to rank number one for lip oil if you're Chanel. Yeah, because it's just like if you're totally new to Amazon. How Amazon works is what how you get ranked by Amazon. 

Obviously, as a business, a capitalistic business, they're going to rank, they're going to organically put listings up that drive the most sales. So if you rank number one for lip oil or you rank number three for makeup, it's because that listing drives a lot of revenue and gets a lot of sales. So Amazon is going to rank it high. 

2:20:21 - Brian Becker
Yeah, yeah, and I mean it's a very like. All of their products are super prime worthy. You know, buy it now, get it tomorrow, you know it's. 

2:20:32 - Will Evans
it's a very easy sell on amazon right, yeah, yeah, moving on, um, you know, when it comes to their competition, it gets a little bit more competitive here with some of those competitors that are in the lower price point market. Um, like we literally talked about nyx and maybelline. These, I think, are like the competitors maybelline, the two competitors they have that are that are like really kind of in that more higher quality, uh, lower price point um segment thatf is dominating in. And we talked about how Elf beat that. Elf is killing them online because of the innovation engine, because of the virality and all the stuff we've talked about. 

2:21:28 - Brian Becker
But they're also beating them on Amazon just organically. Yeah, yeah, I mean, is it's it's clear what this kind of mixture can do? They have you know, it's not just the like low price point. 

Um, yeah, you know, at the end of the day, we're kind of getting towards the end of the episode here. It's like, if I really have to sum it up, of like, why does this brand work? It's not just the price point, it's. Does this brand work? It's not just the price point, it's not just the virality, it's not just the positioning, it's the combination of those three. You know, it's really the low price point mixed with this, like trend driven, you know, insight into what's actually happening in culture, and then reinforcing that with, like, quick access and very easy to get and very quick turnarounds and dupes of the, the more expensive thing. So giving everybody access to this thing very, very fast, whether that's through prime or through their website or at target. You know you can see it on tiktok and pick it up at target right now. 

Um, you know, whereas a lot of other things might not feel that accessible, like if you have to go to Sephora to grab, you know, like the, the, the one celebrity brand that is only at Sephora, and so you know there's, there's, there's a lot of benefit here of like that is why this works. They are, they're, you know, nyx and Maybelline. Maybelline is a legacy brand has a lot of exposure, a lot of retail exposure, but they don't get digital nearly as well and their products are a little bit more expensive, you know, and then NYX might be the price point, but they don't get digital, they're not digital first, they haven't really, they don't have that same kind of presence that Elf does across the board. That is really driving the actual awareness of the brand. 

2:23:13 - Will Evans
Yeah, really driving the actual awareness of the brand. Yeah, um, yeah, in some ways, like to some, like, my reaction to what you said is like they're like the success they see on amazon is sort of a culmination of everything that's going on here. Yeah, you know, I mean, like I, I think one of the main, a big reason why they rank number one for lip oil and makeup and and concealer might not necessarily be because people are searching for lip oil, totally cold and coming there and being like, oh, I'm going to buy elf. It's because they have so much brand awareness through social media and stuff like that. That, uh, that they're in. You know, everyone knows Amazon. Everyone, a lot of people are prime members, um, and so they're just buying it right there. And, and Amazon is like pushing them up, um, because, again, it just it makes so much money. Yeah, um, let's. Let's like to close out Amazon. Let's just talk about their bestsellers here real quick. I think their top one they got is this Lip Boil 140,000 trans sales a month through this listing. That's crazy. 

2:24:30 - Brian Becker
Considering it's only an $8 product. 

2:24:31 - Will Evans
It only is $1.2 million a month, which is wild. We were looking at some of the Yetis, like the Yeti Rambler. I think we broke that down last month and it was I forget the numbers off the top of my head, but I think it was a lot less transactions but a lot more revenue. 

2:24:46 - Brian Becker
But like five mil a month yeah. 

2:24:48 - Will Evans
Yeah, yeah. The Primer is another one of their top selling products. That gets about six hundred and seventy thousand dollars a month in sales. So that's a little bit about their Amazon business. Let's jump into the retail business. I think this is our last slide here, maybe. Yeah, yeah, I think this is where we're closing out. 

2:25:10 - Brian Becker
But there this is. I mean, this is a huge part of their play, I was just about to say. In comparison to Yeti, yeah, they have 150,000 purchases. Elf does through Amazon, generating a million, but there is so much more retail penetration by Elf than Yeti. By design. Yeti has their kind of bespoke specialty retailers, whereas Elf the retail strategy is opposite. It is how do we get into as many retailers, especially low-cost retailers, as possible? You have the stats up here 88% of their sales are coming from retail, with over 50% coming from Target and Walmart alone. You know, so that you know the percentage of their sales that are coming from from Amazon is like very, very low on their list, I would imagine. Then you got Ulta with another. You know what would that be? Probably $100 million coming from from Ulta. They did have brick and mortar stores for a long time but they closed all of those, I think in the late 2000 and teens, right. 

2:26:18 - Will Evans
That's interesting. Yeah, that was interesting because this is the playbook you're seeing a lot of these DTC stores do now. 

2:26:24 - Brian Becker
Yeah, like. 

2:26:25 - Will Evans
Yeti, for example. Right, oh, let's like really control the experience. Let's have our own retail stores. 

2:26:32 - Brian Becker
you know, right, um, and that's not the playbook with elf, like you said no, it's true, and uh, the most interesting thing about this that I you know, is they're even going back to their roots, in a way, and are yeah, they just signed a deal with dollar general, um, to hit more rural areas. You know that's it's a very interesting play. It makes sense, though, because you know, I've, in our kind of travels over the last year or two in the RV, we end up in some places that are, you know, it's 40 minutes to the closest Target, or, you know, sometimes even Walmart, you know, and the stuff that's around is a Dollar General. And so, you know, sometimes even Walmart, you know, and the stuff that's around is a dollar general, and so you know people that live out there and aren't, you know, making their regular trip when they want to go grab something. The fact that a brand this high quality because the price point is right could be available in dollar general is is a huge, I think, going to be a great boon for them. 

2:27:31 - Will Evans
Yeah, it's about accessibility. You know, like we we talked about like most brands would run away from doing a deal with dollar general yeah maybe like that, like I don't want to like, like you know, put my brand in a store like that. You know um even yeti, who is like a lot of their target market, is probably aware. For the rural, yeah, for the rural, you know, but because the brand is about accessibility, it really it totally fits in. 

2:28:03 - Brian Becker
Yeah. Yeah, we already talked about the receipt scanning too. Such a cool concept, Love that. But yeah, I mean, this has been such an interesting brand to jump into. I love that. It's, you know, in a way very opposite of what we covered with Yeti, but still really similar, still maintaining quality, but just competing in a different type of market in a different way, you know. It really kind of shows how you can be super successful with a lot of different strategies in business, you know and kind of you, but still the playbook in some areas is the same. 

You need the omni channel presence. You need to be in Amazon. You need to have some retailers whatever, whether that's all retailers or specialty retailers. You need to have a good, you know email strategy. Apparently, you need to be using an email design system as well. According to both of them, too, You've got to have a lot of different traffic sources. You've got to be creating content. That's another thing that was similar between the two of them. They have really unique, dedicated content that's really angled towards the type of customer that they're trying to attract. But yeah, this has been a fun one. 

2:29:11 - Will Evans
Yeah, thanks again for watching, guys, and again, we give all of this away for free. You want the slides, you want the funnel breakdown that we shared, the email breakdown that we shared, the audit that we did too? Just go to floatcandycom, backslash elf and you can download it all for free. Anything else, brian, before we wrap up, no, Thanks. 

2:29:34 - Brian Becker
Y'all Appreciate you coming to listen and we'll see you next time. 

2:29:36 - Will Evans
Yep, we'll see you on the next one Later, everybody. 

Transcribed by https://podium.page