Lara Schmoisman 0:05
This is Coffee Number Five. I’m your host, Lara Schmoisman. Hello, and welcome back to Coffee Number Five. Today hot coffee is warm and ready to have a very, very, very exciting chat we have today Tara Cohen. And we realize that as we were pre chatting that we have a lot of things in common and a lot of events that probably we cross each other, but we didn’t know each other. And I hope that the next one, I can give her a hug in real life. But welcome, Tara, thank you so much for being here today.
Tara Cohen 0:42
Thank you for having me. Lera.
Lara Schmoisman 0:45
So for everyone who doesn’t know, Tara, you are the founder and startup advisor.
Tara Cohen 0:53
So I have a company called Mixst Beauty. We’re in rebranding mode right now. So we’re eventually going to be calling it mixed studio. And what we do is we build, we work with founders, makeup artists, celebrities, doctor, doctors personalities, with people who want to build their own brand. So very focused on the beauty space, or beauty adjacent. And I help them from you from concept all the way to launch, even after launch. Sometimes I’ll even come in as an advisor to help them with inflection points, building their innovation pipeline, or even helping to turn the company around helping them where to focus where they can be more profitable, and where they can grow.
Lara Schmoisman 1:53
What do you think? Because I, I see a lot of new brands out there. And we already have and crowded space. How can a brand be different? How can they stand out?
Tara Cohen 2:07
That’s a great question, Lara. I’ve had this conversation at different points in my career. I’ve been in the beauty industry for 20 plus years, I came out of corporate, I was in corporate for 16 years. And every moment there was always this question on the beauty industry saturated. And every single time we’ve said that, there’s always been a shift, whether it’s a retail shift, when Sephora and Ulta came onto the scene, tick tock now has a shop, Amazon came around. And when you have these cultural technology shifts, you start to see more growth more new brands come in, even though maybe the classic old guard brands consider it Oh, it’s very saturated. We are in a time where there are a lot of new brands, it’s a more open space. And what we’re seeing now is people, different groups, you know, different cultural groups, different. I don’t want to call them pain points, but problems in certain areas that never had a really good solution, or products that didn’t cater to a specific type of customer or a certain skin type or hair type, for example, or age group. This is what we’re seeing that’s coming out into the marketplace. And I think essentially, people are feeling oh my goodness, there is a lot coming out. Because there’s more niche. Yeah, it’s more by concern. It’s more concern. It’s more niche. And it’s sort of pushing out those big established brands, because those those companies, those brands aren’t able to get as granular as these newer brands. So yes, I do in some ways feel like the market is potentially saturated. But I still think there’s room for growth because there are groups of people that truly feel that they’re not being served, that they feel like they’re being underserved, or they have specific concerns that they want addressed. And therefore there’s opportunity.
Lara Schmoisman 4:52
Yeah, I’ve seen that lately. There are a lot of smaller brands that had suit closer their toe orders? Yes. And even the warning some retail stores. Why do you think that these happen? And what could be done differently?
Tara Cohen 5:09
Yeah, I can’t speak for all those brands, but I can speak from experience. I’ve been an integral part of at least 15 brands in the last four to five years, whether I helped build them from scratch, or came in on a project, or help them from an advisory position. And oftentimes, I see the same things happen. There’s a few things. One is making sure that you have the right team in place. And sometimes the team that you start with isn’t always the team that you’re going to be with at the end. Sometimes you need other types of expertise, or bigger expertise. I also see some times, brands aren’t bootstrapping enough, they’re spending too much too quickly, in the beginning, and they’re always playing catch up. At some point,
Lara Schmoisman 6:18
I agree with you 100%, I’ve been seeing the same thing, I see that a lot of the smaller companies in where they tried to do it, do it yourself to be super lean, but then it’s not having a team to support them. So they cannot really run their business. Because they’re trying to do it everything and without the strategy. And or I see the other thing that they go on work with freelancers without the strategy there. And then the last part is that they go on hire really expensive people thinking that in two to three months, it will turn around and everything will change, right?
Tara Cohen 6:55
Yes, I’ve seen a few different scenarios. Some people have said, Oh, we don’t like consultants, or we want full time people. I think that’s a mistake. I think that’s a little bit short sighted –
Lara Schmoisman 7:12
– Because that’s the reason I created my agency to be able to support that gap between not needing to have it in house, and not being able to hire, she has an agency for projects. So you can have like a whole team working for you. But it’s not full time. But you can get specialists in each area. And not one person. I’ve seen this so many times. I have a girl who that’s a little bit of everything. Yeah, but she is not a specialist in email marketing, or social media marketing or bookkeeping. They’re trying to do it. All right.
Tara Cohen 7:48
I mean, I think there’s, there’s a few rare people who could do a lot of everything. I’d like to think I could do a lot of everything. But I’m an expert. And I go deep and very particular –
Lara Schmoisman 8:04
I mean, I’m also I can do a lot, but I’ve been around for a long time. And I did as a part of my job, each one of those things. One point?
Tara Cohen 8:15
Yes, I think your best people are the people who’ve done every single job, because these they can keep an eye and they know talent when they see it. I think a lot of times, you know, just to go back to why certain companies fold it. Sometimes it’s even planning on the operation side, let’s say they’re doing really well, but they can’t keep up with the inventory. They can’t get the inventory back in stock. They don’t have enough capital to repurchase inventory. Marketing has become really expensive, just to buy ads, be on top of Google from, you know, SEO SEM, there’s all these nuances into building an effective brand. These expenses that a hidden costs, essentially that you just don’t see. So I think there’s a lot of different mindsets in regards to that of why a brand closes down. Sometimes it’s just simply just lack of awareness. If you don’t have a budget to do PR to be in social to do the proper digital marketing, if you don’t have a founder story or an authentic story. I had brands a lot of the brands that I’ve worked on that I thought were really great conceptually beautiful products, you know, great positioning great brand, but there was no one I’m to tell the story for the brand. So that was challenging. Plus they spent a lot of money. I’ve worked with incubators as part of a, like a co-founder for another incubator. And they spent a ton of money on the one brand. And I don’t think it gave the return on the investment. They also hired up staffed up a lot of people, which maybe in the beginning is not great to do.
Lara Schmoisman 10:37
Now, as you really don’t know. And it happened to me too, as an agency, I had growth growing pains. Because as you’re growing, the person who worked for you, for one stage of the company might not work for the next stage, right?
Tara Cohen 10:54
Or you need to reposition the position. I always feel like some of these brands, they can renegotiate things. And sometimes they don’t have the right people coming in to help them strategize on how to cut costs, or how to renegotiate contracts, or look for different manufacturers, to help them to cut costs. And so there’s a lot of nuance involved in that. And I think, you know, some of these brands, they’ve been around for a long time, and maybe they want to move on, you know, you do an analysis, you do a business analysis, you’ve launched your brand, you’ve had a good run, but maybe it’s just time to move on.
Lara Schmoisman 11:49
I was talking to a new brand a couple weeks ago, and she was asking me the owner, when do you give up? And my answer was when you’re stopping in love with your product, because if you believe in your product, you have, maybe you got something wrong, maybe some messaging is wrong, maybe the packaging, maybe the positioning, so you rebrand, and you try again, if you still believe in your product, and of course you can afford it. Because it’s gonna cost you money, too, it’s not for free to have a lot of products if you want to do it
Tara Cohen 12:29
Right. If you you know, if you’re not white labeling, and if you’re not pulling it off the shelf and slapping a sticker on it, which there’s nothing wrong with that, you know, if your, your your goal, and your dream is to start your brand, there are cost effective ways to do it. But it’s an expensive, it’s very expensive, just an initial run, I mean, you’re looking at even in the beginning, a small amount of product, and you know, some marketing and a website, you might be 200 250k. And, and then you want to run the brand properly. You’re looking at 600k, maybe 1.5 million, it’s these are numbers, and people have done it with less. You know, I know that there are people, there’s plenty of people we’ve heard about that. We’re all working in our kitchen, which you know, you hear the story and they created a product or they had that one product and stuff. But you really have to believe in it, like you said, and you have to drive it. You can always rebrand. I think based on my client pool and what I’ve seen with startups, I had a brand that they kind of threw in the towel in the first year, the brand took a year to two years in the making, and they threw in the towel in the first year. That’s not giving the brand enough time to succeed. That is someone who’s looking at the numbers or looking at you know, a certain business model that is looking at the neighbors and they don’t know their story.
Tara Cohen 14:18
And they don’t they or they don’t understand the business. I had things where people have promised investors that they were going to make millions of dollars in the first year. Most beauty brands don’t break a million in the first year if they’re lucky. The majority don’t even break a million. These realistic expectations.
Lara Schmoisman 14:44
Yeah, absolutely. And something like I see a lot. There’s a lot of brands that they can they get to me, they get their damage, they have bad experiences, and sometimes fixing something. It’s a lot harder than starting from scratch.
Tara Cohen 14:58
I agree with you on that.
Lara Schmoisman 15:01
So I’m given given a six months, it’s nothing given eight months is nothing. It takes time to fix things.
Tara Cohen 15:11
It does. I think you need some runway. And I think that it’s all about the capital. If you can give yourself a three year run, that will tell you where the brand is and where the brand is going. You can’t really assess a brand in one year. I think some of these brands that have been close, close shop and stuff have been around for a little while. Yes, they’re new brands, but I’m sure they passed the three year mark, maybe it’s five years, we’ve had reinventions. Think about elf, elf was bounced around a few times had different owners were purchased. And they’re huge now. And I think, you know, sometimes it’s a little rebranding, a little faith, new ownership, and a new infusion of cash, you never know. And obviously, I think that’s a good example of a brand. I mean, there’s a few brands that are like that, that are still running, that have had, you know, –
Lara Schmoisman 16:27
When is the right time for a brand to go on personal retail, because I feel like a lot of brands are trying to go retail too early in their journey. And something with a new brand, in my experience that you need many brand owners because you really don’t know your target audience until people start loving the product, and that you’re matching your target audience. And so you’re selling in the discovery phase, and you might need to do some tweaking.
Tara Cohen 17:00
I think there’s a few things why retail, sometimes you know, D to see in the pandemic. And before were amazing and great, DTC will still still continue to be great. But it can’t be the only channel for awareness. Just because you put a website up doesn’t mean people are going to come to it. And so I think a lot of brands look immediately for retail partnership, it really depends on the retail partnership that you are working with. It is sometimes early for particular brands, because sometimes depending on the retail channel that you go to, they want you to support the brand. And they want sampling, some form of sampling, which is an additional budget skew and inventory. So it’s very costly. And so you need that kind of commitment. I don’t think there’s a right or wrong answer. It really is about the brand, the brand persona, who’s leading the brand, the capital that the brand has in place on what the right strategic retail partnership should be. Sephora and Ulta is not, you know, I shouldn’t say this. But from my experience working with startup brands, they’re not really going to look at a brand unless they have a certain level of awareness, a certain level awareness in the social space. Maybe they’re generating a certain amount of revenue, and that there’s an awareness for a brand. I do think a retail partner is helpful for certain types of brands.
Lara Schmoisman 18:58
Yeah, it’s also involved to have a lot of inventory.
Tara Cohen 19:04
Um, I have my experience is sometimes when you start a retail partnership, there’s a lot of test and learn. You go to their, their own website, they take a certain amount of inventory. I’ve never really had an issue with a retailer in regards to inventory. If we’re talking about more mass market drug store expansion, then you do need a lot of inventory. And that requires capital for sure.
Lara Schmoisman 19:41
So when do you think that is the right time for a brand Chico on find funding? Because a lot of brands Bootstrap and they say should I keep going this way? Or should I keep give part of my company away and get funding?
Tara Cohen 19:58
I think it really really is on what is your end goal, and what it is that you’re looking for. I, it really is contingent on what the result is, if you are creating a brand that is truly for everyone, and that it’s for the masses, and you and you have that belief, then, you know, personally, I would want that partnership and capital, and I would give some of that company away. Because my goal is for everyone to experience, the brand and the product, if your goal is to, you know, many people go into the beauty space, because the margins and the profitability, that heads is really good, and you’re instantaneously wealthy. And that I put that in quotes, because a lot of these brands have been around for 510 years before they’ve even gotten, you know, that they need. And I think you have to try to raise capital, when ever you can, that’s, you know, especially if you’re a startup, you need to always be looking and grinding. I think it’s great to bootstrap in the beginning.
Lara Schmoisman 21:27
You know, maybe we’re gonna make your desirable, and you have a product that I see. So you need to put some skin in the game, I’ve worked with a lot of people, you know, and I, I don’t really want to say but you know, certain levels of people where they have, they don’t even put skin in the game, they just, you know, they, their names on it, they slap a thing, they’re not that involved. And, you know, if you really truly want to have an authentic brand, you and you really believe in yourself, you’re going to put a little bit of your own money in, ya know, and also, retail wants you to be involved with your brand, wanted to do your brand awareness, they want to, they want to meet with brands that they’re putting also effort into it. They’re not gonna bring any brand it just for them to have to do all the marketing and everything.
Tara Cohen 22:21
Yeah, yes. And I think most of these brands are putting their effort into it, or their people are putting effort into it, I haven’t met a brand where the founder, or the group that’s working for the company didn’t put their effort. And I’ve also seen higher level. People who don’t, maybe they shouldn’t be in the space, they don’t understand the industry, maybe they don’t have the same passion as maybe the team, let’s say, for example, but I I’ve never really met anyone that didn’t want to be part of their brand. And I’m not going to make comments on other things. Because everything I do, and I say is non-disclosure agreements. But, you know, there’s some people where you’re chasing them down to support their brand,
Lara Schmoisman 23:29
I know I been there, done that, and it’s really hard to work with, with brands that you need to have that consistency, you have to be doing constantly, you cannot have breaks in between. And that’s what I see a lot of rank struggling, because they put a lot of energy in something and then they inflate it. And they have those gaps. And this is an ongoing, I,
Tara Cohen 23:57
I’ve been on brands like that as well. And you know, the truth is the money, the money dries up. And and you are especially in the startup space, you know, and maybe even some of the brands in the mid space. You know, they they kind of have the capital, they go all in on one big thing. And then they don’t plan to ride the wave.
Lara Schmoisman 24:25
But I call that create sustainable strategies, right? You can sustain them that that’s why you need to put a plan according to your budget or like not put all your money in PPC because you’re gonna create a peak, and then all the money’s gone. And that’s it. And then what happen.
Tara Cohen 24:48
And sometimes plans are in place and they’re not followed. Yeah, yeah. I mean, you’re testing and you’re learning. I think a lot of people that are coming in the space Ace or they don’t really understand the ebbs and flows, you’re testing and you’re learning. And I think the goal is is to have steady growth and control you know, always test always learn, always look at your numbers always do a B testing for follow your numbers, understand your sales,
Lara Schmoisman 25:23
Not understand the consumer, yes,
Tara Cohen 25:27
And understand your consumer and understand your consumer and oftentimes what you start out with may not exactly, there’s always a wish, I find brands have a wish they want this type of customer or they want this particular person and I think you need to define it. But you also need to maybe cast a little bit of a wider net, or you have to have realistic expectations, or you have to understand who your customer is, understand what her his them everyone what their needs are,
Lara Schmoisman 26:08
And what are their pains, what are their high products will satisfy that need? Right?
Tara Cohen 26:15
Right. And I think, you know, a product really can make you feel good. It can solve everything. But I think a brand with strong messaging can bring people in and create advocacy
Lara Schmoisman 26:34
Absolutely. So Tara, before we go, I have one more question for you. Because we’re talking about this space, and that people that they don’t understand the space, how do you learn this space? how someone can start in this space? I know that the margins the beauty industry are very tempting. But I always say that in order to break the rules, you need to understand the rules.
Tara Cohen 26:58
Yes, I agree with you. i You need to keep an open mind, you really need to do some research and learning. You don’t have to memorize all the names and all the brands. But what you want to do is you want to get out into the stores, you want to go through the aisles, you want to look at the products, you want to try stuff you want to put things on, you want to be able to understand that go to shows, follow makeup artists get makeup artists, books. Also, there’s a ton of amazing magazines, articles, new newspapers, beauty matters, glossy bathing. Yes, beauty dependents business of fashion. WW de, it’s hard to even keep up.
Lara Schmoisman 27:57
I always also say I was given a conference at USC last week. And one of the students asked me, How can I get mentorship? How can I talk to people in the industry? And it was like, well, sometimes you just need to go to an event where you interact with these people that you will respect, just invite them to a coffee was kind of have a beautiful coffee? Or can I take a few minutes of your time and talk about these? Or can I have your opinion? Many people will say yes, I got five emails after that day by asking for virtual coffee, which is completely fine. And I love that they follow the advice. But just go on, find people that you respect and pick their mind.
Tara Cohen 28:40
You got to put yourself out there a little bit. I think one is you have to understand that everyone’s busy and has a schedule. I think LinkedIn is a really great way just to easily connect. You know, follow the people that that you like, if they’re doing anything, whether it’s a podcast, or blogs and things,
Lara Schmoisman 29:01
But be transparent. If you want to connect with that person, pick their mindset, send them a message and say, Hey, I’m trying to do this. I love to connect and see what are you using Bing in that message?
Tara Cohen 29:15
Agree and you never know. You never know what can happen. You just have to put yourself out there and you know, meet and see what happens. Yeah, which always I have found to be very positive.
Lara Schmoisman 29:31
Always, always every time. It’s hard. I’m a lot more comfortable in in my office and not driving in Los Angeles. That for example, yesterday I was at the beauty butter event. I’m exhausted right? It was like I’m happy that I went there.
Tara Cohen 29:47
Yeah, I’m sorry. I missed the event in LA but I’m definitely going to catch it when it’s in New York and next time in LA I’m gonna make a concerted effort.
Lara Schmoisman 29:56
Yeah, well, yeah, it’s it’s good to remind ourselves Start we need to still even we’ve been in the industry for too long, maybe but we still need to make that form of showing up.
Tara Cohen 30:06
You have to show up. That’s that’s the part of it. That’s been my philosophy and everything.
Lara Schmoisman 30:15
Yeah, I’ve shut off the battle. Absolutely. Thank you. Thank you. Thank you for having coffee with me today. I really enjoyed this conversation.
Tara Cohen 30:25
I appreciate it. I had a great time. Thank you so much.
Lara Schmoisman 30:29
You guys, I will see you next week with more coffee number fun, everything you need at LaraSchmoisman.com Or in the Episode Notes right below. Don’t forget to subscribe. It was so good to have you here today. See you next time. Catch you on the flip side. Ciao. Ciao.