09 Jun 2021 --- After recently receiving an investment of $830,000, we talk to Armaan Mehta, co-founder of tech beauty sampling business Odore about the company’s journey so far and how it plans to progress its three pillars: creation, collaboration and data to ultimately transform the beauty industry.
Click to EnlargeOdore co-founders Karam Gupta (left) and Armaan Mehta. Source: Odore.What was your inspiration behind Odore?
Karan Gupta and I co-founded Odore, after meeting and studying at the London School of Economics. After graduating, we went and worked in different areas of finance and technology. Coincidentally, at both the companies we were working at, we were researching the beauty space, and we noticed it was really lagging in terms of innovation.
We thought it was prime for massive disruption, especially when we looked at how much brands are spending on digital marketing activities, while the innovation and data were not up to speed with all the industries. Then we said, ‘Okay, as a customer, what is the tangible problem that brands would probably be facing?’ And the answer was the way samples were handed out.
Through researching the growing trends with the current venture capitalist market, we saw it was becoming extremely saturated, without allowing customers to try products at home before buying. We thought that brands must be really struggling to accelerate customer growth. That was the light bulb moment where we realized there is so much investment going into the production of samples. And there is so much value that can be generated from them. Let us find a way to really optimize that, produce a smart investment and create that customer journey for a brand.
We launched in 2018, and it is quite an interesting story because where we are today is quite different to where we were when we started. Our vision and our value proposition is somewhat the same, but the product and the channel by which we are going by is slightly different.
Interestingly, we decided to tackle offline before online and now we offer solutions in both. We see the digital side growing exponentially. We started off with our sampling devices and these were essentially smart vending units that brands would purchase at lease and place them in convenient locations. These quickly received the interest of major brands and we knew that to capture the entire sampling market, we had to offer both online as well as offline solutions. We started working on our online platform a few months before the pandemic hit. The realization of the pandemic catapulted that side of the business and accelerated us as a group.
Can you talk me through your route to market, and how you managed to capture the attention of and work with leading global brands?
Our route to market has involved taking part in an industry incubator, numerous projects and an accelerator program, where we worked with several notable and international brands and have been able to demonstrate our technologies.
Then, we started our first round of fundraising at the beginning of this year. We raised our seed round with the vision to transform the way beauty marketing happens.
What does your business look like today?
Right now, 99% of our revenue comes from our online sampling and online platform. The online sampling actually works by enabling our customers to build campaigns on the platform. These companies can be using social media, emails or a combination of both to promote their online and offer samples.
So, while it may look like all of the company’s branding at the front end, our platform is running in the backend and ensuring these campaigns are working optimally. On top of this, we offer complete, managed services or design development fulfillment to ensure the samples reach the customer's home.
A big part of this is to look at the key performance indicators (KPIs) that brands are really trying to generate. You have brands that use our platform to generate brand awareness, to generate new sales or to generate new reviews. So, what we focus on with our platform is ensuring that we are hitting those KPIs. We do this by having follow-up sequences and ensuring brands can follow the journey of every one of their samples.
Click to EnlargeOdore is aiming to offer solutions that can be used both online and offline.
You mentioned 99% of your revenue is online, do you feel like that is a permanent shift or that it is going to balance out after COVID-19?
What made us look online was seeing the trends and always having that key metric in the back of our heads. We asked, ‘What percentage of sales this year was offline? What percentage of sales is online?’ In beauty, most sales before the pandemic were offline through brick and mortar. Now you are seeing brands like L'Oréal saying that by 2025, 50% of their sales are going to be online, which is incredible.
For us, we needed to ensure that we are offering solutions both offline and online because we need to stay relevant to our customers. We are very customer-centric, and everything we build on our platform is to ensure that we are still solving the pain points that our customers are facing.
The more we saw our brand partners investing in online, we knew we had to offer solutions online too. We were a very small team at the time, so we could not do everything, but we did slowly start building that online platform in the back. We allocate a lot of our resources towards accelerating the online platform.
As a business, the majority of our sales will be online—that is the way the market is moving. We have noticed a lot of inbound traffic from direct to consumer brands, which do operate in that space. Those are the brands that are focused on investing more in digital innovation.
Congratulations on your recent investment —how do you plan to use this to revolutionize the beauty market?
We raised this investment with some fantastic investors in the UK, a mixture of venture capital, family offices and private investors, with the vision to transform that personal care marketing space. It is about understanding consumers and better mapping out that customer journey. It is about going back to that initial point of centralizing all the stage streams in one place.
We have got exciting plans and features that we are going to be rolling out in the next three to four months. We are extremely customer-centric, and our customers really drive our product roadmap. With that investment, we are looking to build up one of the most talented engineering teams. We have hired people recently and plan to continue to understand the pain points and build effective solutions on our platform.
What are your immediate and longer-term plans for Odore to achieve these goals?
We are on the path to being one of the most effective sample platforms out there. In terms of the online piece, we only launched last year, and now, we are one of the fastest-growing companies in that space. We take a lot of pride in providing the best data, providing the best support, providing the best experiences for brands and the guidance and would like to launch the most effective campaigns in a year's time.
Our retention rates are consistently strong, and we are working alongside our customers all the time to ensure that number is as high as possible—we are always aiming for 100% retention. We like to have that kind of open dialogue with customers to truly understand what they are trying to achieve and how those objectives evolve in line with the market. We want to grow our customer base and ensure that we are delivering the best product—that is our goal.
By Natasha Spencer-Jolliffe, BPC Insights Senior Journalist