Coffee N5 - Margarita Arriagada

Episode 119 – Coffee N5 – Behind the Scenes of a Beauty Brand from Scratch with Margarita Arriagada

On this episode of Coffee N° 5, join us as we sit down with Margarita Arriagada, the former CMO of Sephora. With years of experience discovering and nurturing talents in the beauty, fashion, and home interior industry, she now introduces her own one-of-a-kind brand VALDÉ Beauty.

We’ll talk about:

  • Knocking on doors as a start-up beauty brand
  • Letting the customer be your guide
  • Tips on establishing your brand
  • Marketing to support your retailer

For more information, follow Valdé Beauty on Instagram or visit the website.

Follow our host Lara Schmoisman on social media:

Instagram: @laraschmoisman

Facebook: @LaraSchmoisman

LinkedIn: @laraschmoisman

Twitter: @LaraSchmoisman

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Lara Schmoisman  00:05

This is coffee number five. I’m your host Lara Schmoisman. Are you ready to get some PR? Well sign up for free and get my template today.  Hi, everyone. Welcome back to coffee number five. I mean, you guys shop for paid products I always saw I mean, everyone has their favorite store to buy products. And I mean, they’re the stores that carry many, many brands. So you can choose to be advised. But you’ve never think who is behind the scenes in these rounds. I mean, there’s so much like between choosing the product, training the sales force and explain because they are the ones who need to provide information about the product, there is so much going on. So today, I’ve got someone that I’m so excited. And I honestly I always admire her and I met her in person and then invited her to this podcast. And I think she’s gonna give us amazing information. So welcome Margarita, Rihanna, that she was a former CEO, CMO of Sephora.

Margarita Arriagada  01:17

Thank you so much, Laura. Thank you. I’m super humbled and excited. First of all, to see you again. And and thank you for having me on your platform. Thank you. I thank you for being here. I mean, yeah, this covers so many brands over your career, you work with smaller brands with bigger brands. And you broke a lot of rules in in between, because he started doing this a long time ago, being a woman, the Latina, and also breaking the role of bringing emerging brands that to Sephora, that they weren’t necessarily unity and know how they would perform in the market. So can you tell us a little bit about how was your trajectory? And how did you get to where you were at Sephora and to help emerging brands. First, I will tell you that I didn’t start out in beauty I in my career started out in fashion. And I thought that that’s that’s where I studied fashion design and merchandising that fit them. And and then I spend quite a bit of time in the home area and, and I used to work I grew I spent a long time in Macy. So I was on the retail selling floor and very, very consumer centric. And I share that because it has perspective to how I landed in Sephora and in my trajectory at Sephora. But what I want to what I want to underscore is that I never wanted to be in the cosmetic beauty space. Because my impression of the beauty space was what I witnessed while I was at Macy’s quote unquote cosmetics, a traditional cosmetic space. And I had worked. I had just finished a role and wanted to take a break. And the gentleman who was CEO of Sephora at the time, I run into him whom I knew I ran into him at an airport. And he had a role he had an opening for a head of color cosmetics. This was year three of Sephora launch in the US at the end of year three. So it was very, very new, the concept was new. And of course I was aware of it. And he he remembered, you know, he remembered my work ethic. He the what they knew was at Sephora was the antithesis of department store, department store model. And he said to me, Would you be open would you be interested? And you know, considering Sephora and I said no, you know, I don’t want anything to do with cosmetics. For me, it felt like a very traditional, very set in its way very structured way of doing business. And I was always very entrepreneur, I was always about finding new designers are traveling the world and looking for artisans. And so in this person know me enough to think you know, it would probably be a good idea to have someone that doesn’t have the cosmetic experience.

Lara Schmoisman  04:28

So I honestly I love that you come from the fashion and accessories well that’s where I come from to I used to teach for the digital marketing for fashion industry. And and I believe that give me first of all different visions of cosmetics. And because there’s so much in common that people don’t realize, at least from the marketing perspective. They’re Lazzeri brands.

Margarita Arriagada  04:55

That’s exactly right. And I think that that’s what helped me quite quite honestly I did No cosmetics, I didn’t know, this is a way we do things. And the CEO at the time, didn’t want to take a page out of the, here’s how things are done. And we were excited that we were getting a young, a young customer that wanted to explore wanting to discover, and for me, my strength was traveling around the world, you know, uncovering things, you know, bringing an element of surprise and delight. And I fell in love with these little indie brands, I fell in love, I fell in love with their stories. And I think what kicked in, for me was just as natural, organic excitement that we could share, you know, within the organization that everybody had this common enthusiasm that we share with the customer on the discovery, and the storytelling and these new products, and this new approach to do business. And that that’s really how it happened. A lot of it happened, because they knocked on our door, quite frankly, this was a new, you know, a new retail venue that was very much about indie brands. And then and then and then we looked for for many brands, because we approached it from the standpoint on what is the customer wants? And how do we fill their needs? And so, you know, it wasn’t just like, okay, you know, come on, come on, you know, you know, there it is, you know, we’re just gonna put it all out there. No, there was a thought process of, we want to make sure we have makeup skincare fragrance, we want to make sure we have some luxury brands, some indie brands, some artistry brands, and then we let the customer lead us and guide us, we could see by the sales by category, what would do well, but we listened to the customer, I was in stores every weekend. And they would say to us, you know, we would love to have, you know, more ethnic, you know, brands, or you know, or women of color, you know that we let them lead us. And that’s how we assorted and that’s how we built the brands. And we were so so so vested, I think we just develop a very close relationship with the brands to help them grow.

Lara Schmoisman  07:22

Let me ask you a question. If let’s say I have a brand, how do I approach it? Place like Sephora, and say we want to carry my brand.

Margarita Arriagada  07:33

Today is very different than when I was there. And when we first started to develop the business because when when when Sephora came to the to the industry, it changed the industry, it changed that can really, really did that fashion aspect, you know the trendiness you know, the hot products. It wasn’t that kind of a type of a business model, it became something far more exciting. And with that, it grew and grew a lot. And so now, fast forward 1520 years later, and it is a it’s a very saturated now, you know, everybody wants to create a beauty brand from celebrities to you know, influencers to like, No, you have a product idea, why not? You know, beauty is hot, because it’s a new way of expressing and it’s, you know, the experience. So it really is a very lucrative business, but because it’s so lucrative, and the financial community plays when when I when we launched, there were no investors and beauty other than the big institutions. Now you have private equity firms, venture capitalists, and that it’s a new, it’s a new day. That’s the industry is far more saturated, but the expectations and how to grow a business is also significantly different. We could take our time, way back then, because we didn’t have the pressure. You know, we could, you know, the brands could grow at their own pace, and there wasn’t the pressure. Today, there is a lot more pressure. So all that to say is that brands to be considered at Sephora, and I can’t speak for Sephora, obviously. But it’s significantly higher, harder, you have to be more established. You have to have now you know, have grown your your community, you have to have a following. You have to bring business to Sephora. Whereas before you could rely on support to help you grow your business.

Lara Schmoisman  09:39

This is something that I speak with a lot of the indie brands there first of all two things when they manufacture like don’t go crazy and don’t manufacture your first batch. Crazy numbers because cosmetics expire very well. And so you need to create a batch that you’re going to say And to some retailers, you’re gonna sell some some influencers, but you need to be consistent in doing your work your marketing strategy. Like, I always say, retailers will never consider you, if you don’t do your own marketing, they need to see that you’re creating your own brand awareness and support you your partner,

Margarita Arriagada  10:22

correct. I mean, I advise because I spend a lot of time mentoring brands, I advise brands to establish themselves, you know, go through the, I mean, unless you’re, you know, very, very popular and you have a lot you have an incredible team. And you’ve got a strategy of what you know, what you’re going to do and you know, like some celebrities, you know, like Selena, Selena Gomez that has just, you know, that has done, you know, rare believe she didn’t test she launched at Sephora, okay, you get that? You know, check check. But for the rest of us, no, you have to establish yourself, and you have to learn what it’s like to reach to your customers, what it’s like to provide the level of service, what’s working, what’s not working, what’s resonating? Is your social resonating, do following do you embrace brand ambassadors, all these different types of things, because Sephora now has an incredibly long list of brands that want to get in. And you’re very far you’re a mile long on the totem pole on on getting in. And so, you know, and today, the customer is keen. So before, when I while I was at Sephora, you could kind of lead an influence what you want it the customer to experience. Now, it’s not that way anymore. This aura has a point of view. But now the customer comes in and says, Where is this? Yeah, there’s social media. Yeah, social experiences, incredible important. Last time, we were speaking, I remember very clearly that you were telling me that you really were really pushing for these indie brands, but many times the indie brands they ramp up and realize that when they get pre Taylor, they it’s another part of their marketing that start that you need to create marketing materials to teach the, the sales personnel how to sell your product, because you’re not going to get a huge space, in Sephora, whatever, you are going to get the little space, but you need the support of those people in order to promote your product completely, because it is the cast members or beauty advisors in any other retailer that with a customer comes in. Mostly now they come in knowing what they want, they’ve done their homework and social media and, and social influencers help in that in that respect. But if you go into Sephora, and you’re looking for a skincare product and you want, you know, an under eye cream, and you know, here are your issues, you know, the beauty advisors can’t recommend everything and they can’t know everything. But but but they are the trusted source. And so it’s really, really important for brands to you know, have a hero product, you know, have that one product that they’re known for, that at least can help did beauty advisor zero in on how to promote your product. But yes, that is how you rely that, you know, some people come in and want to shop on their own. But a lot of people want that assistance. And in that beauty advisor is such an integral part of that conversion.

Lara Schmoisman  13:45

I see a lot of people that they don’t realize how important is to create marketing to support your retailer by Einstein, for example, if you’re going to be in support because you’re not going to be in every territory to in selected stores. So if you know that you’re in Sephora in certain territories, actually I will run ads to give to show up in Sephora buyers in certain territories. So they start creating the brand awareness on your brand and then when they go to Sephora, they see it

Margarita Arriagada  14:19

Yeah, you need you really do need and I you know it’s great that you’re that you’re addressing this topic because I’m just I’m just started I just started to launch and retail. And while I’m not in store I’ve just launched at Neiman Marcus and I launched in I in Saks right in time for holiday. Okay,

Lara Schmoisman  14:38

let’s stop this for a second about the product. First tell us about your product because it’s wonderful and I can see it in the background. So maybe you can show us you.

Margarita Arriagada  14:46

Thank you thank you so much. Well I started with this this vessel here which is called soar. And what the what these are is their artistic vessels that personalized refillable lipstick products, what I wanted to create was in an experience. And so these are vessels, I call them armor, because a brand was inspired by my mother who wore lipstick as armor. And, and the input is on what you know, influenced me to create the brand because I never in a million years thought that I would ever have a beauty brand was that at the end of her life, she suffered from dementia. And obviously, she didn’t recognize me. But every time I took out that lipstick, you know, it made her happy, she would perk up, she would pick her up ready for application, and she would look in the mirror and not realizing she was seeing her. She saw beautiful, a woman she would kiss the mirror. And so I just thought to myself very profoundly, you know, how is it possible that she could not recognize me, but she never forgot how lipstick made her feel. And that was what drove me to create a celebration in a mosh woman Nafi. You know, for my mother for women, for all women, because my you know, I think that would I admire so much about my you know, my mother is, you know, it’s something that is intrinsic in all women, you know, her her her strength, you know, her ability to transcend and, and overcome her femininity, and just, you know that just the unlimited potential that that she had. And so I wanted to create something that felt more significant, then then then the commodity of a lipstick, so good. I’m selling an experience. And so these vessels go over and lipstick, so do you use it like this? And it’s a refillable, right, and, and, but you can also take your lipstick on the go if you don’t want to be so fancy or a little extra. And so you personalize you, I have a lot of different vessels like this and you can change them around. So this collection is called sore came in three different finishes. And the reason is called sores because it’s got feathers, signifying wings. And it signifies for me it was symbolic of this aspect that a woman you know can be light as a feather. But together in the collective us as women altogether, you know we can we can fly we can conquer.

Lara Schmoisman  17:28

Definitely beautiful there for the holidays.

Margarita Arriagada  17:30

Thank you so much. And it comes in a beautiful story box set, it comes with a refillable case and in a pouch, and I just recently launched this new collection called reflect. Because it mirrors it’s chrome, very modern, very sleek, very sexy. There’s magnifying mirrors at the top. And again, you can interchange the vessels. So there’s three of them. This is called this is a rose gold is a holographic which is called reflective spirit. Uh huh. Which is beautiful. And then this is reflective love.

Lara Schmoisman  18:11

So knowing everything that you know, because I interrupted before when you’re telling me that now you’re at Neiman Marcus. And so how was your experience trying to get from the other side into retail?

Margarita Arriagada  18:24

Very humbling is the short answer. Very, very humbling. Because, you know, I’m the person who’s I’ve always been a retailer. And so I’m the person whose door was not constantly I’ve never had to knock on anyone’s door, right? Yeah. And so to be perfectly honest, it has been very, very humbling. So, but I was super self aware, knocking on doors is something that I’m not very comfortable with to do, to be honest. And I’m still figuring that out. And you know, and as a founder, you must do that you must learn how to ask for help. And you know, you have to go out there and hustle. But I launched two years ago in the middle of pandemic at the end of 2020 with a lipstick concept that is very, very premium. Its couture, quite honestly because it’s not just me or fashion background, it’s coming into the view and you see how I Oh, I always say that fashion and beauty are so connected. It’s something that everytime is more I mean, in the packaging in everything. It’s yeah, it’s a statement piece and I that also comes from the fashion background. This for me feels very Aleksander McQueen. Uh huh. And so yes, it definitely my my background kicked in. And despite you know, the aspect that there was, I mean, I remember the days of tearing McLaren fashion and you know and seeing you know, in the 80s you You know, these women that he had with these great corsets, you know, and just and that, you know, that was the inspiration on how I created the look and feel of this product. But what I wanted to say is that I had to really feel my way through the positioning of my brand. And in creating that comfortability and the desire and this brand, because it is experience, it’s not anything that anybody needs. abrasion, it’s an incredible, let’s be honest, I mean, not, you can go away, get away without using any theory or cosmetic brand conscious wash your face, and you’ll survive, maybe not as provide. So feel good category. And within that feel good category, what I wanted to create is my vessels, and my experience is very much about celebrating the woman, either celebrating yourself or celebrating someone else that you want to honor via a beauty product. And so that, for me is what the bullseye vision is. And I want, you have

Lara Schmoisman  21:12

very clear who your audience was. And I think that that’s one of the biggest errors a founder of a beauty brand can make is not starting the brand, knowing who their audiences who are they’re going to targeting because you’re everything, all the communication needs to be the same for that you need to say I go in prestige luxery mass must take what are you doing? Who is you’re going to who’s your target audience? And between those categories, you need to know what age are you going after? And who’s your competition? So how you also going to differentiate from the competition? I mean, you have such an unique product that probably you didn’t have to pace, a lot of competition out there.

Margarita Arriagada  21:58

Or there’s none. Yeah, I’m alone. I’m alone, I honestly, I am trying to create this couture segment above, where luxury beauty is today. Because when I went to, to, to create this product, and I thought to myself, what is there out there, that I would gift my mom, in honor in this celebratory way of what the intention of the brand is, and there were a lot of beautiful products out there, but I didn’t think that any of them delivered in this personal way, artistic way, that would be a product that you would want to keep right that you would you would remember forever, that is going to be cherished, you know, for a long time. And so yes, I was very, very clear. Of that whitespace opportunity there is there is no competition, but it is a very risky, very, very risky. And it’s very challenging, because as you were saying it’s a blank space, but at the same time or does it fit does it fit in the array hearing? Or either simply compassion in your case? Yes. Is it bridges, bridges, but at the same time, you can fit in both, which is exactly right. So I do tap in and that took a while to learn. And so, I mean, what I would offer is that, you know, you have to have a an important sense of what your customer is your concept and very clear your narrative, your communication, really the value add above and beyond the product because having a good product today is just not enough, right? You know, what is the need that you are filling? And I am creating a need? Yep, nobody would wake up and say, Oh, I have this need no, I am what I have done is tried to create a weight people on a on a on an aspect of a need that the perhaps

Lara Schmoisman  23:55

I think that what you’re creating is an experience. I can totally see my grandmother that she was so cookie cutter. And she was using always lipstick. And I think if you go into my purse, there is only one thing that you’re going to find several on their lipsticks, I mean to me, I mean, you’re gonna find probably one pen. But you’re gonna find several lipsticks because lipsticks are important. And it’s how I present myself to the world. I mean, I go to a client meeting I have in my drawer three lipsticks, and I go do anything. So the first thing I bought is lipstick. So you’re creating that part of experience.

Margarita Arriagada  24:34

Yeah. Thank you. Thank you for Thank you for understanding that. I appreciate that. So the first year and a half I spend really trying to hone in on my narrative, understand where my audience is, how do I get to my audience? I mean, I thought that my audience was was beauty and to a certain extent it is. But I have begun to figure out now bridging the fashion, the fashion aspect and that takes time. But before you actually hit a retailer, and so I do encourage brands to figure, Figure it out, be very, very clear as to what your formula for success is going to be before you hit a retail partner,

Lara Schmoisman  25:17

and that’s really sound and wise advice, don’t think that the first thing you’re gonna get, you can go not go and hit the retailers. I mean, you can go and do TTC, and you need data, you need to know your user experiences and have testimonials. So that’s the only information that you can go

Margarita Arriagada  25:41

to, and understand where are they coming from? How are they seeing you? You know, what is what is your repeat purchase? You know, I mean, all these important things. You know, how do you market what is the messaging that will resonate with them. And you know, as I am now, at the end of year two is I think about 2023. And my strategy, I am now trying to now get very, very tight on my positioning of the brand. In order to get bolder, because you have to cut through the noise, there’s a lot, there’s a lot of discovery, when we have our own products, we believe everything that we are taking their assumptions, we need to confirm that it’s real. And that’s why we need to get the data, we need to get input from our customers. That’s why reviews are great. For me. I mean, you’re you learn from them, if you use them, right. I use, I use the data, because I have like clients, I say, they were thinking that their audience it was such and such. And then we’ll look at the analytics, and they show us that the people that are really interested is different. Correct? Correct. Correct. You’re

26:57

absolutely right. Yeah, marketing is is very important. You know, in order to cut through the noise, and to be able to target your audience and understand, you know, exactly the channels that they’re, you know, that they’re at, so that you can cast a net over them completely agree. And

Lara Schmoisman  27:19

probably at the beginning, you need to go a little more broad, in order to understand really, who is your customer, and then you can narrow narrow it. And then when you say, Okay, this is my customer, my perfect avatar, then you go and target that very.

Margarita Arriagada  27:34

And for a brand like me, that takes time. And so you’re right, I think the first year, I was testing a lot of different things I was doing, you know, media buys, I was, you know, getting the, you know, different ads, different campaigns. And, and, you know, it’s far more predictable for other brands, but for me, because the concept was so out of the box, I really had to fish a lot, you know, it was a lot of trial and error. And also there’s a lot of investment. It’s not it’s not cheap. Yes, yeah, let’s be honest, I’ve seen it’s a pricing, I mean, I, you know, I for for the brands that are fundraising, you know, I am the person that will say, if you’re gonna go for a million might as well go for two, because you’re gonna run out of it very quickly. And, you know, fundraising takes a long, long, long time, you know, to be able to do, it’s very exhausting. So you might as well go for it, but be very, very clear as to what you’re gonna do with money. But it does take money. And I’m a luxury brand. So it took a lot of money for me, and I had to really ensure that I had because I’m self funded, that I had the right amount of money for a runway to allow me a few years of learning, testing different things. Otherwise, you know, you’re you’re, you’re,

Lara Schmoisman  29:01

I love that you say the word testing, because you need to trust your market in order because let’s say that even you get, you’re lucky and you get one of the retailers, but doesn’t mean that it’s a bright partnership for you. It’s important that when you know the your audience so well, that then you can target your right partners to

Margarita Arriagada  29:25

absolutely 100% Correct, and may not be the right partner. And by the way, that’s where the work begins here. You know, it takes a lot to be able to get in through the door. But once you get through that door, because it is so crowded, you know the retailers really rely on the brands to you know, bring that awareness and bring that demand into the retailers. And so that’s that’s a hustle that’s really, really super critical, important. And it’s a diversified campaign of what works. Some of them may be and so maybe it’d be so shows something maybe, you know, then trunk show yes

Lara Schmoisman  30:05

definitely it’s absolutely an omni channel market and you need to be doesn’t mean you need to be everywhere you need to see what works for your brand but it’s definitely omni channel

Margarita Arriagada  30:18

Correct correct

Lara Schmoisman  30:22

thank you so much gracias for being here. I love this chat and we we need to do it again. We do we do this do cafecito live and you know in real life one of these days soon. My very best wishes on a on a on a great year. Here’s to a great 2023 for everyone for entire audience. Thank you for having me. On, on your on your show. I appreciate it. Thank you so much. And to you guys. We can be more next week. So stay tuned. Find everything you need at Laroche, Morris mn.com Or in the Episode Notes right below. Don’t forget to subscribe. We’re so good to have you here today. See you next time. Catch you on the flip side. Ciao ciao.

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