Beauty box businesses: The next craze?

Regional - Beauty box firm bellabox has received an injection of AU$1.3million after a round of funding for regional growth, indicating a rising trend of beauty box businesses in the region.

Beauty box businesses, which work by offering subscribers who pay a monthly fee a box of beauty product samples sent to them regularly, have been popping up around Asia for sometime now.

For bellabox, by pairing product trials with editorial content, subscribers can later purchase full size beauty products through its e-commerce sites, placing editors in each of its markets to educate consumers on products. A similar service in Singapore is VanityTrove, which asks subscribers to pay SG$25 a month for a package each month.

According to a spokesperson for bellabox, the firm is growing fast. "We have grown over ten fold in the past year and are now growing at over 20% each month. Our membership base consists of professional women who want to try the latest beauty products but don't have the time, as well as beauty addicts who have their finger on the beauty world pulse," she told Marketing. Subscribers range in age from 18 to 63, she added.

Sampling is key to reaching and engaging consumers, added the spokesperson, offering a cost effective and compelling way to access an engaged audience, and at the same time tracking and getting feedback on their experience with the product.

"We have many touch points for the brands in their sampling exercise, from the targeting of the products sampled to our customer base, to editorial, creation of viral marketing and then driving sales. We have seen a very high conversion rate as well as huge media exposure and real viral marketing in each sampling campaign," she said.

Key revenue streams are its membership base of subscribers' fees and also its e-commerce shop.

Globally and in Asia, another such brand is Glossybox boasting a presence in 19 countries, including Japan, South Korea, Taiwan, Hong Kong, and China.

While the trend has yet to reach its peak in the Singapore, the business model has already had few casualties. For instance, FabulousFinds  which launched in Malaysia in June 2012 has already closed the business.

As for bellabox, it was launched in October 2011 in Singapore and Australia by Sarah and Emily Hamilton. The service was aimed at offering an inexpensive way for consumers to try out beauty products and it has since partnered with brands such as Benefit Cosmetics, Estee Lauder, shu uemura, Kiehls, DKNY and more.

The round of funding was led by Lance Kalish, co-founder of global skincare brand Yes To Carrots, and Elevation Capital partner Trevor Folsom. The investor syndicate includes Monash Private Capital, SquarePeg Ventures, Apex Capital Partners, amongst other investors.

The funding will be used to broaden the depth of the management team, raise awareness within the region and continue business growth, particularly in the area of the e-commerce site, customer experience and subscription numbers, said Sarah Hamilton. The company aims for a dominant position in Southeast Asia.