According to a report from Statista, skincare products account for 42% of the global cosmetics industry—an industry that is currently valued at $380.2 billion. As the leading product category of one of the most valuable markets in the world, the skincare industry is undoubtedly a lucrative field for aspiring entrepreneurs.
Many skincare startups have successfully captured the attention of consumers and are doing very well in sales and market share. However, a lot of skincare brands are also floundering and suffering from low sales, lack of momentum, and problematic growth strategies. For startups, this can be their undoing—there’s not a lot of room for errors, and costly mistakes can spell the end of their venture.
If you’re planning to start your own skincare business, here are some of the common errors that you need to avoid.
#1 Not Having a Unique Selling Proposition (USP)
A USP is a value proposition or unique selling point that differentiates a brand, product, or service from its competitors. Your USP is essentially a product characteristic, pricing structure, marketing strategy, or perceived benefit that sets your brand or offerings apart from the rest of the herd.
When you’re developing a USP for your brand, here are the steps that you need to follow:
- Identify a gap in the market that your product can fill. Leverage this gap, and offer your product as a solution for potential customers.
- Create a USP that is unique, distinguishable, and memorable. It should reflect your product’s exclusivity or uniqueness and appeal to your target audience.
- Make sure that this USP is something that you can deliver consistently since it’s going to be the core of your branding and marketing strategy.
#2 Inconsistent Branding
Brand consistency refers to the process of making sure that your images, values, and messaging are consistent across all channels. Brand consistency makes it easier for customers to remember your brand and associate certain color schemes, typography, and even sound bites with your business.
Greater brand recall also leads to higher levels of customer trust. In fact, according to a study from LucidPress, brand consistency can increase company revenue by 33%. And because branding is essentially a reinforcement of everything your product promises to deliver, all forms of communication with them should keep your brand on top of your customer's mind.
Inconsistent branding can only hurt your skincare company. An article from Harvard Business Review reported that 64% of customers say that their primary reason for developing a relationship with a brand is shared values. When your values are constantly changing, it’ll be tough for your customers to trust you.
#3 Not Pricing For Profit
Another common mistake that skincare brand owners make is pricing their products too low. Some of them may be hesitant to charge too much for their products, others may be worried that they won’t be able to attract their target customers when the price is too high.
The truth is higher prices in the cosmetics industry are often associated with better quality. When your products are too cheap, it may signal to potential consumers that your products are of substandard quality.
How do you know when the price is right? Here are the steps to follow when you’re determining the pricing structure for your skincare products:
- Evaluate the value that your target customers place on products similar to yours. A survey can help you with this.
- Consider customizing certain products at specific price points for different customer segments.
- Consider price elasticity, or the percent change in sales if given a 1% change in price.
- Determine the price of product bundles and individual products.
- Consider how your competitors will respond to the prices you’ve set. Remember that even a brilliant pricing move can all turn to waste if your competitors get a chance to respond.
Building Your Skincare Brand? We Can Help
It can be tough to build a skincare brand from the ground up on your own. You can definitely benefit from the experience and knowledge of industry experts. Our team at Aloe Laboratories has been in the industry for more than 30 years. We’ve worked with countless companies and entrepreneurs who want to start their own brand of aloe vera products.
Aloe Labs can be your partner in turning your dream project into reality. Contact us now to see how we can help.