Some say it all started with Warby Parker, the now famous company that first created the direct to consumer online approach for the eyewear industry. Shopping skeptics said people would never buy certain things online because they needed to test the products in person. E-commerce companies have now found success in everything from groceries to luxury apparel.
One industry ripe for disruption is cosmetics. Though most purchases still happen in stores, a startup called Karity is striving to change that. Their direct to consumer method effectively saves the consumer money while still producing a high quality product.
Karity, a New York based startup, thinks it can persuade people to shop online for makeup, by providing a combination of great quality, low prices, technology, and genuine customer service. This seems to be working. In their first year alone Karity has sold over 750,000 brushes. With little ad spend and a small core team, Karity is rightfully disrupting the $63 billion makeup industry.
This company joins a new generation of startups focused around the direct to consumer approach. Similar to Dollar Shave Club, a monthly razor subscription service, Karity focuses on smooth transactions that will eventually enable people to try their makeup on at home free of charge.
Companies like Karity focus on organic growth instead of huge endorsements that all of the cosmetics companies live by. As their founder Isaac Rahimi says, "We are an industry that is completely cornered by a hand-full of corporations. Karity is different, we offer everything without the markup. We don't need to pay Miley Cyrus and Nicki Minaj for ridiculous endorsements. Owning full line of distribution from manufacturing all the way to selling it to the end consumer allows us to pass on the savings while still investing in the very core of our business, quality."
In my mind, there are three main reasons why this direct to consumer approach is the future of almost every industry.
One of the main reasons behind the spark in this business model is the savings they pass onto their customers. Companies like Karity often design their products in-house and go sell straight to the consumer through their own website. This cuts out the margin when selling wholesale, where an agent and retailer often need to make margin causing prices to be higher.
Another aspect of this business model is how efficient it can be. When you order makeup online from Karity, it often arrives at your door within 2 days using their multiple fulfillment centers across the US. They offer free shipping and returns, and are implementing a free try-at-home program that is launching in November. This service will enable customers to try karity makeup in the comfort of their own home and send back the makeup they don't want to keep, free of charge.
When you walk into a retailer, you are often confused as to where and how the products you are purchasing were produced. Karity offers a background about each product like their eco-friendly 24 piece brush set that features real bamboo handles, vegan hair and materials, and premium soft synthetic bristles.
Karity is also directly in touch with customers enabling them to review products directly on their website. As an example, one customer says, "my expectations for these brushes were pretty low. The price (I think I paid around $28.00) seemed too good to be true. I was blown away when I received these." Reviews like these reflect the transparency Karity offers which is often the backbone of this business model.
With companies in nearly every industry starting to try the direct to consumer approach, retailers are beginning to take notice. This is the future of business, as customers create the value and have a full understanding of what they are buying. When we look into the future of consumer behavior, this direct to consumer approach will be at the forefront.
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