How to Build a 7-Figure Business in the Competitive Cosmetics Industry

Israel
7-Figure
2013

The secret to international eCommerce entrepreneurs Amir and Shirley’s success lies in their ability to create a highly personalized experience for not only their shoppers, but their community of influencers as well.

What makes their brand, Glam Guru (international site), so unique are the collaborations they have created with brands, affiliate marketers and their customers. Not only do they run a 100% personalized beauty eCommerce business, but through these collaborations they able to additionally include a branding model to assist up-and-coming new beauty brands launch their new products – all while ensuring that their customers have access to all the beauty information and advice they need, samples of awesome new lines, and awesome promotions.

We chatted with Amir to find out how he and his wife, Shirley, got started, how they manage to dominate over the ‘big guys’ in such a centralized market, what their future plans for the international market are, and to get an inside look into their unique reward and influencer programs that help keep their brand relevant.

1. Share with us a bit of background about your eCommerce brand.

Based in Tel Aviv, Glam Guru is a family-run company, founded by myself and my wife, Shirley. We didn’t come from an eCommerce background, but had extensive sales and marketing experience. Shirley has always been an entrepreneur, and back in 2013 she discovered the American-based beauty subscription service Birchbox. She fell in love with the idea and decided to start something similar in Israel, catering to the local market: the first Israeli beauty box, offering the experience of a surprise beauty box delivered to your home, offering high-value products to try.

Glam Guru Founders

Our goal was to build a beauty community of smart consumers who can not only enjoy surprise samples from the best brands, but to also buy their favorite full-size products on our site. However, from the start, we understood that we would eventually be bringing more attention to the eCommerce side of our business of full-size products, and over the last couple of years we have moved away from beauty box sales as our main focus.

That’s not to say that beauty boxes aren’t still a great way to bring awesome traffic to our store. Instead, we now take advantage of periodic box sales, that are not subscription-based, as an effective way to introduce new customers to our store. These boxes are either seasonal, or we do specific collaborations with magazine brands and such to create special one-off boxes for which we run big marketing campaigns.

beauty box subscription servicebeauty box subscription service

Since starting Glam Guru five years ago, we’ve had over twenty differed beauty box variations, with over 100 brands, as well as selling various products individually from over 120 brands, bringing it to a total of 7,000 products being sold on our eCommerce store.

2. How is your business structured?

In regards to day-to-day management, I run the marketing side of things as well as, given my legal background, all the legal aspects of the business, such as contracts with brands, suppliers and collaborators. Shirley runs sales, operations and customer service. There are five of us in-house and we use a variety of freelancers or agencies with specific tasks, such as designers, SEO agencies, AdWords with Traffic Booster, etc.

3. How have you found the transition from lawyer to full-time entrepreneur?  

I have always been more passionate about being an entrepreneur and starting things from scratch, and I was always trying to do things on the side. In particular, I found eCommerce fascinating because of the way the market changes so rapidly, and how it has grown into one of the hottest industries in the world right now. Therefore, making the switch to full-time entrepreneur – doing something that keeps me on my toes and that I am so passionate about – has been very fulfilling. I have even become a real makeup expert, even though I don’t use any myself; I know every brand and product and what it does. Every day there are so many aspects you can focus on, that can help you grow and succeed. It combines so many things within one business, so it is always exciting.

4. Why did you decide not to stick with a subscription-only model?

As we are based in Israel, the market is very centralized. To create a long-term monthly subscription service, we would need a constant flow of new sample products and brands on a monthly basis, to keep the boxes fresh and unique, and to ensure that the magical experience of opening the box was maintained for our consumers. Logistically this wasn’t feasible, especially in the beginning when no one knew us. We didn’t want to be in a situation where we were unable to provide boxes that weren’t special or fresh month after month, which is what a good subscription service should do.

Bonus Content: How to Upgrade Your Unboxing Experience to Pro Level 

5. Who’s your main market?

Right now we market only in Israel, but have created an English version of our site, which we are hoping to roll out internationally soon, where we will be able to bring unique Israeli products and brands to the international market by way of beauty boxes.

6. How are you able to compete in such a small market with many competitors?

Over the last couple of years, a lot of big eCommerce brands have come into the market.

We focus on creating a unique customer experience for our shoppers. We stay firmly in the beauty niche, and have positioned ourselves as an authority in this niche. When customers come to Glam Guru, they know that we’re experts and will be able to help them select the best products for them. We have great collaborations with beauty influencers and bloggers and the brands themselves, to create rich content on our site that customers can use to make the best buying decisions for them.

Additionally, we aim to provide the largest selection of brands and products, to ensure we have what our customers are looking for.

beauty brands on glam guru

Today, we’re leading the market in that respect, as we have a variety of products that people are not able to find on other sites – even the bigger brands. The key to our success is our flexibility to be able to work with everyone in the beauty market. For example, as a shopper on our site, you can buy anything from pharmaceutical name brands to exclusive hair salon brands that are normally only sold from exclusive brand stores. Shoppers can have a cart full of a variety of products and brands, which adds to the customer experience.

But what truly makes us unique compared with other online stores here, is our ability to work very closely with brands – not just to sell, but to collaborate with them on marketing strategies that enable them to leverage our platform for growing their brands.

7. How do you ensure that you are able to provide personalized customer service?

Our personalized experience comes from our personal customer service. This is very important in the beauty market, as shoppers look for highly personal suggestions in order to buy the best products for them as individuals. One of the main ways we do this is by leveraging live chat functions on our site, WhatsApp, and dedicated customer service phone numbers, where our customers can talk directly with one of our expert customer service reps about cosmetics. We even consult with pharmacists in real-time about their cosmetics, to ensure we are helping our customers place the right orders for their needs. This is not just about sales; we encourage customers to contact us with any beauty questions, to send pictures if need be, in order for our beauty experts to best assist them.

Bonus Content: How to Cash in on eCommerce Personalization Trends 

Additionally, we have a small Facebook group where customers can engage with us directly regarding upcoming products or engage with each other as a community, exchange products, advice, and recommendations and organize group buys.

Additionally, we have a small Facebook group where customers can engage with us directly regarding upcoming products or engage with each other as a community, exchange products, advice, and recommendations and organize group buys.

8. Take us through your distribution and fulfillment process.

Having a 100% online eCommerce business, with the expertise we have gained over the years to form partnerships and collaborations, being able to understand and adapt to market needs – we’ve created a hybrid model. This includes managing a small inventory ourselves as well as having dropshipping suppliers, and forming brand partnerships for fulfillment. This is what allows us to stock such a wide variety of products on our store.

9. Can you give us an example of a successful joint campaign between Glam Guru and new brand launch.

We collaborated with an Israeli brand, Promisesurrounding their brand launch and the launch of their product line. As it was a totally new brand at the time, we didn’t know what to expect. Combining their product quality and our experience, we were able to create a solid campaign around their brand, which included using our beauty blogger influencer connections, creating a specific beauty box around their products, and featuring them in the main areas of our site. It was a hit and although they are still growing, it has been one of our best-selling brands ever since.

10. What is your most effective way of attracting new customers?

Like all eCommerce, it’s very dynamic and constantly changing. If you had asked me this three years ago, or even a year ago, Facebook would have been the definite answer. But it is changing. At the moment, Instagram is growing for us as a marketing channel; we are also working closely with beauty influencers, which is a very effective way of getting more customers. In fact, our influencer program brings in a big percentage of our sales!

Additionally, we encourage our customers to spread brand awareness through word-of-mouth. We have a number of off- and on-line ways to promote this, and of course, having a good customer service track record also encourages this.

11. Tell us a little bit more about your influencer program.

We have a long-term relationship with a community of influencers who have grown with us since the launch of our brand five years ago, and it’s a hybrid of paid posts and affiliate marketing. Today, we work with over 150 influencers who blog, YouTube, and/or Instagram, and we try to create specific promotions at least once a month.

We have an in-house affiliate technology that allows beauty influencers to create an affiliate account with us and have their own unique links to different pages or products on our site. This enables them to earn a commission on each sale that is generated from promotion on their site and/or social accounts. We are able to measure and track how much traffic and how many sales they are bringing to our site, as well as see commission earned. We have found that our affiliates have grown into big influencers in the industry, therefore as they grow, so does our exposure.

Bonus Content: Beginner’s Guide to Instagram Influencer Marketing for Online Store Owners 

Because we work with so many brands, and it isn’t just one type of product, there are many ways to keep things exciting for influencers, which helps us form these long-term relationships. Such as offering three-way collaborations, where we talk to specific beauty brands about partnering up with specific influencers to help push their products. We are then able to get free products from the brand that we can offer to influencers, while also offering them sales commissions.

When looking for new influencers, we try to match up with people who mimic the ethos of our brand: genuine, real and true. People that have an audience that really relates to them, not just in terms of engagement metrics, but an active audience who values their message and advice, as well as those who are interesting, unique and have their own voice.

using Instagram influencers for eCommerce

12. What other types of online marketing campaigns do you have the most success with?

As a brand name with different types of products, Traffic Booster is definitely a huge asset. It takes away the headache of having to manage multiple campaigns on AdWords. Knowing someone is taking care of those campaigns for us, and is doing a good job, enables us to concentrate on other aspects of our business as well as ensuring we can remain lean in terms of the number of people we need in-house.

Bonus Guide: What Advertising Options Does Google Offer?

With regard to Facebook, we have had great success in using it as a tool, not just in terms of conversions, but as a brand awareness tool that allows us to get close and engage with our audience directly, which we can then use to guide them into our sales funnel.

With regard to Facebook, we have had great success in using it as a tool, not just in terms of conversions, but as a brand awareness tool that allows us to get close and engage with our audience directly, which we can then use to guide them into our sales funnel.

13. Take us through your email marketing strategy.

In conjunction with our other channels, we run weekly promotions to a bigger segment of our market. Again, we try to focus on personalization with regard to email marketing, running different email promotions and providing different, high-value content to different segments. Segmenting based on what types of products they prefer, such as makeup versus skin care, or if they have not purchased in a certain period of time. This is in addition to our automatic emails, which include a series of abandoned cart emails and new subscriber welcome emails, which are broken down into three emails:

  • In the first email, we share information on our company, explain who is behind our brand and how it was founded, and outline our personal customer service approach.
  • In the second email, we then dive into more about how our site works, what we offer, the benefits of joining our site and our reward program.
  • In the third email, we move towards more promotional content, sending products that would appeal to new customers.

14. What reward program do you offer?

Since launching, as part of our personalization approach, we have included a rewards program. This program involves giving what we call “Glam Points,” where customers earn points on activities such as purchases, reviews or upon subscribing. These points accumulate and can then be redeemed by our shoppers as cash discounts on our products. Using a Magento extension, we have been able to develop our own internal software for a rewards program.

example of eCommerce loyalty programns

15. What must-have apps are you using?

We use Traffic Booster, live chat and MailChimp on a daily basis. Given the size of our product database and the type of open source customization we were looking for, we decided to build our store with Magento, which has enabled us to develop our own in-house software, such as our affiliate and rewards programs.

16. What have been the most influential resources for building your business? Books, blogs, podcasts, etc.

Generally, I use a lot of online resources such as online courses, eCommerce blog articles, and expert sites, all of which have helped me learn about every aspect of running a successful eCommerce business. For instance, when we started this business I knew nothing about online marketing, so I read and followed expert blogs such as Jon Loomer, went through all of Google’s AdWords resource guides and articles, and took classes on Udemy.

Some eCommerce blogs I follow include A Better Lemonade Stand, the StoreYa blog, and Shopify’s blog. Offline I try to read business books to keep me motivated and to constantly learn about entrepreneurship.

17. What are the big future plans for your brand?

As I mentioned, our goal for the immediate future is to grow internationally. We’re busy laying the foundation for that, which includes translating our site to English and securing collaborations with brands outside of Israel. Our long-term future objectives include developing our own beauty brand, bringing more international products to our Israeli customers, expanding our men’s beauty and baby product categories, and looking at other accessory products outside of beauty for our female shoppers.

18. What’s the no.1 piece of advice you would give new eCommerce entrepreneurs?

Always be learning and ready to try again or change. Choose your business partners (including brands, people or companies) wisely so that you can stay true to your values.  

19. If you could go back to the very beginning, is there anything you would do differently?

Yes. One thing that held us back in the beginning was choosing the right platform for our business.

In the beginning, we didn’t really know much about the tech side of eCommerce, so we chose WooCommerce. Although it’s a popular platform, we found that it didn’t suit our brand and needs. Our goal has always been personalization, and we needed something that would allow us to build things like beauty profiles for each of our customers, combine beauty box subscriptions with general eCommerce models, our reward and affiliate programs, etc. All of which we found challenging for us to do on WordPress, and gave us a lot of teething issues when we started.

Bonus Content: Shopify, WooCommerce or Magento: How to Choose the Right Platform 

When we were designing our second site, we chose a development team who again built it on WordPress, which meant we continued to spend unnecessary time on technical issues, working twice as hard on ensuring we maintained a good user experience. It was only when we eventually moved to Magento that things ran a lot more smoothly, which in turn gave us more time to work on marketing and customer service.

For more inspiration, secrets and tips, visit our Success Story blog section.

 

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