Podcast transcript
James Dihardjo
Chad, thank you for making time in what I believe is your evening. I wanted to kick off real quick and get you to explain who you are and what it is you actually do.
Chad Selvidge
Fantastic. Thank you, James. My name is Chad Selvidge and I am president at beBold Digital. beBold is a boutique marketing and sales agency helping brands, beauty brands sell more on Amazon and walmart.com.
James Dihardjo
Awesome. And, you know you actually come from a background from Sally Beauty as an example. So tell us in your words why is the beauty category so hot on platforms like Amazon and Walmart.
Chad Selvidge
You know, I think there are at least three factors that I can think about, right? One, in general trust in e-commerce, right? So beauty is one of those things where you learn about beauty from some trusted. Usually, it's somebody like a family member, or a friend, some trusted resource, right? So you learn from your sister, your mother, your father, your uncle, whoever, right? And so it had this very personalized feel to it.
With technology and the rise of social media and influencers and this whole thing, they've kind of found a way to make the category more personal via technology. And, so I think that's part of it. I think the second thing. Beauty is a frequent purchase, and most people are pretty brand loyal. Once they find what they like, they stick with it. And so, sites like Amazon and walmart.com make it super easy to keep replenishment and keep things coming to your home without much effort. So that's good.
And I think the third thing that's equally important on the brand side, is that beauty brands are really understanding now the role, the positive role that that sites like Amazon and walmart.com can play in their overall go-to-market. And understanding how, how that's an important piece when you think of what is the statistic. Something around 65-70% of all retail searches in the United States start on amazon.com. So it's a really great place to make sure your brand is well represented, as a place to go, where people go online to start shopping. So I think all those factors really are driving what's happening right now. The fact that social media and influencers and TikTok have levelled the playing field for all kinds of brands to play now is just really leading to some pretty cool innovation. And innovation drives the market.
James Dihardjo
Interesting. Very interesting. And just with all that market growth and being a hot space, what challenges are you seeing for beauty brands in the short term on these channels?
Chad Selvidge
Much like other spaces, the supply chain is still an issue. Whether that's the supply chain and getting the raw materials or getting the bottles, there's some bottleneck there, so to speak. But also I think, as more and more retail, physical retail locations have opened, there's a challenge now between how do you satisfy all the demand that's there? So, that's one thing. And I think the second thing is really how do marketers decide to balance their marketing budget when it's spread across multiple channels now And trying to figure all that out, I think is a challenge.
James Dihardjo
Interesting. And that's a good segue into my next question for you is, I think you mentioned the stat of retail searches starting on Amazon. What is the relevance of something like a Walmart for beauty brands? Should they be on it? Should it be on their roadmap? Why? Why not?
Chad Selvidge
I'm going to say yes, and I think they should. And here's why. First of all, Walmart, is the largest retailer in the United States period. And if not the world. Something like 130, 140 million people pass through their doors every day. While they still lag way behind e-commerce on Amazon versus Amazon, they're catching up and they're not afraid to spend hundreds of millions of dollars to maintain relevancy. The website is updating. They did a deal recently with Space NK out of the UK to put stores in stores so they understand the power of beauty to drive traffic. And Walmart may take a while to get there, but they always get there.
I'm always recalling a story back when Walmart first tried to get into grocery and they didn't do very well at it. So rather than be kind of the typical number one arrogant retailer in the world, they turned around and said, all right, who knows how to do it better than we do? Oh, these guys are in the grocery industry. Let's go get them and bring them in. And now they're the number one grocer here. So, you know, they know how to win. So I think the relevancy is that the millions of shoppers, the fact that they're committed to beauty over the long term and then just this idea of their mentality or mindset when it comes to serving a customer, I think are all things that beauty can take advantage of.
James Dihardjo
Interesting. And obviously, as you say, Walmart's so new, it's still growing. Do you see a level of reluctance from brands of when you say to them, oh, you should consider Walmart. Do you see reluctance? And then internally, how should people think about overcoming that reluctance or convincing others in the business to actually this is a good idea.
Chad Selvidge
You know, I think it's a really great question, right? First and foremost, the impression is that Walmart is everyday low price. And so, a lot of the prestige brands are very concerned about going on to an environment that's like that. And my answer to that is just kind of watch what they actually do.
I think they've seen the success that Amazon has with beauty. It's one of the better categories on Amazon and they're wanting to figure out what Amazon did right. And I think there's a mentality in Bentonville that says, all right, let's get it figured out. Let's do what we need to do to make it right. So I think there's more to come on what they do in the future, but I think they understand that the model has to function a little bit differently.
James Dihardjo
Interesting point. Onto my final kind of question for you, Chad.
Chad Selvidge
Sure.
James Dihardjo
Global marketplace channels. So what I mean by that is, you know, you've got your Amazon US obviously, but from where you are, Amazon UK, Amazon Australia, you've got those other things. What is your view on that for the beauty space? Obviously, there's a compliance and the gating that you and I have talked about separately. But what is your view on other global markets through the likes of Amazon? Is it worth exploring for brands outside of the US? Why or why not?
Chad Selvidge
I absolutely think it is, right? And a number of reasons why that is. One, there's an ease of use. Once you understand the system, it pretty much replicates, it's a very quick way in terms of penetrating international markets. It allows you to get in quickly without going through the process of either setting up your own infrastructure or working through a distributor that you may or may not know. So there are a tremendous amount of advantages from just the execution point of view. I think when we look at the platforms and social media and how global the reach is in terms of, think about something like TikTok. That global reach is that social media is having a tremendous impact on the beauty industry. And so why not follow, right? The marketing is there. The awareness is there.
I think for brands, it also builds brand identity and brand awareness. When they can go into these international markets and they've got a platform that'll help them do that quickly. And it's easier to scale when you move like that. As someone who spent a few years managing beauty businesses in South America and in Europe, I can tell you that brands are really looking for a way to grow and looking for a trusted way to grow. One that they know that their brand will be taken care of and represented the way they would like it to be. And these platforms really offer that opportunity. I think it's kind of a no-brainer. Once you get your distribution and figured out, pretty sure you've got your US market covered. I think brands should be looking to go globally and this is a great way to do it.
James Dihardjo
Yeah, for sure. And just one little bonus question for you on the global expansion MercadoLibre, right? What does that look like for you? What is your opinion on it? Does that fit the mould of you know, it's a great way to kind of enter the South American region?
Chad Selvidge
Absolutely. I do. I think it's a great way to do it. Particularly if you don't have your own infrastructure. The reason I think it works really well is they were kind of the first mover, and they’ve already got a lot of a pretty big lead in a lot of the marketplaces. So, I think it is something that you definitely consider. And it's growing very quickly, right? Obviously on a small base, but it’s growing. E-commerce is growing very, very quickly in South America and the markets they serve, Mexico as well.
James Dihardjo
Fantastic. I'm glad to hear that. I'm looking forward to releasing that with you guys.
Chad Selvidge
I’m looking forward to that as well, by the way, I think that could be very big.
James Dihardjo
Yeah. Well, look Chad, I don't want to take up your whole evening. I know you and I talked for hours. But thanks again for doing this.
Chad Selvidge
James, thank you for the Invitation. I really appreciate it.
