While consumers were sheltering at home because of the coronavirus pandemic, subscription cosmetics retailer Ipsy found more opportunities to connect with its current customers and acquire new ones.
“Getting a Glam Bag in the mail gave [our members] something to look forward to, something that makes them feel good,” says Karishma Baijal, vice president of growth at Ipsy. “And they need that now, more than ever.”
Ipsy’s new customers grew 60% month over month since mid-March to end of July. And it has generated more than triple the revenue in this time period compared with the 2.5 months of pre COVID-19 ecommerce sales, the retailer says without revealing specifics. The retailer credits this growth in members and revenue to the new ways it reached its customers online, such as with a virtual beauty event and allowing shoppers to purchase single products outside of a subscription.
For example, within a week after the pandemic was declared a national emergency on March 13, Ipsy launched its first-ever online pop-up shop, which allowed shoppers to purchase individual items in makeup, skin care, hair care and body care categories, rather than having to sign up for a subscription bag. Ipsy now has this pop-up event once per month.
“We’ve seen an uptick in skin care and hair care purchases as members have started to look to Ipsy to replenish more of their beauty and personal care needs,” Baijal says, without revealing specifics. Because of the uptick in purchases, Ipsy added more inventory. Plus, some of its limited-time flash sales, separate from its monthly pop-up events, sell out ahead of the close of the sale, she says.
It also pivoted its in-person event called Ipsy Live into a series of virtual beauty events from April 20-26 that included daily giveaways, beauty tutorials, makeup competitions and live performances with celebrities such as Iggy Azalea, Madelaine Petsch and Doja Cat.
And last month, the cosmetics retailer added even more personalization to its Glam Bag Plus subscription—the middle tier between its Glam Bag and Glam Bag Ultimate subscriptions—called Ultra Personalization. The 3 million Glam Bag subscription members now have more control over what’s in their bag every month.
Ipsy tuned into more personalization because consumers’ behaviors are changing given the pandemic, Baijal says, noting shoppers want more personalization and control. “We are catering to new needs that have emerged through the pandemic,” she says.
Members can now select three of the five full-size products they receive from a product assortment that has already been personalized based on their beauty quiz results and reviews, which means there are 12,000 possible product combinations every month. Before, the products were chosen based only on the beauty quiz results and reviews; members could not choose any of their full-size products. Ipsy says each Glam Bag Plus bag is worth up to $350 a month, but costs members $25. The Glam Bag gives subscription members five “deluxe” samples for $12 per month while the Glam Bag Ultimate gives members eight personalized full-size products and four deluxe samples for $50 per month—both of these tiers allows members to choose one product per month, while Glam Bag Plus members choose three.
Ipsy also personalizes the shopper’s site experience. When a member logs in, she sees personalized recommendations and membership details, including a reveal of what’s in her monthly bag and when her bag will ship. And once she has selected her products for her monthly bag, including any add-ons that cost $3 extra, the shopper can find out tips and tutorials for using the chosen products. Plus, once a member receives her Glam Bag, she can review every item, which gives Ipsy more data to tailor future bags and what products to offer.
“We’re able to leverage all of these data points to really drive personalization at an individual level, but also to inform and improve our algorithm, which in turn, creates an even better experience for all of our members,” Baijal says. Ipsy also uses behavioral data, as in how a member engages with email, onsite and in its mobile app, to inform more personalization, she adds.
As Ipsy looks ahead, it is bracing for a potential pandemic-driven recession while remaining cautiously optimistic about its sales thanks to its growth since mid-March. “A large part of our strategy is really leaning into our community for feedback and ensuring that we stay nimble and reflexive to their ever-changing needs,” Baijal says. The retailer intends to continue delivering new features and new experiences that will bring even better value that also keeps members around, she says.
“The way consumers experience beauty is changing, as sampling and swatching in-store is no longer an option, and we’re able to provide them with a way to discover and trial new products in the safety of their home,” Baijal says.
Ipsy is No. 136 in the 2020 Digital Commerce 360 Top 1000.