10x Growth on Temu - how Direct Beauty pulled it off

Welcome to another podcast from ChannelX World here at the Autumn Retail Festival and I am still in our posh plush booth with a Georgia from Limworks so welcome back Georgia how are you? I'm good thank you Chris. I don't think we've got a new guest with us. We've got Dean from Direct Beauty. Welcome Dean how are you? I'm not too bad. Thank you guys and thanks for having me. It's nice to be here. It's a pleasure and as always I'm Chris Dawson Editor-in-Chief of ChannelX. I really enjoy the podcast today. I'm excited for this one because I know Dean your business stretches across so many channels and we are at ChannelX World which is what it's all about. But first of all tell us a little bit about yourself and how Direct Beauty came into being. Yes so we started up our business in 2011 so we've been around for quite some time. We actually started with selling goods from Australia strangely so I think it's when Ugg boots is all the rage. I've got friends that lived in Uggs. Really? The soft furry comfortable ones? They were good days and maybe they bought a pair from us back then so we was doing that for a long time and selling the shoes. We decided to kind of go into a different market and one of the directors at the time Vinod he said what about going into the health and beauty sector. We've done a little bit of research and looked at it and we didn't really think it would take off as well as it did but it did and it took us so well that we stopped selling the shoes. We left that behind completely and then here we are today as Direct Beauty which is a rebranding. We rebranded our site maybe two years ago from Direct Beauty to Direct Beauty just to make it a bit easier to search and here we are today. Well let's face it beauty is one of the highest growing categories in retail in the car of my life. On every marketplace I go on they've got fashion, home and garden beauty and then maybe auto but it's the top three isn't it. So what's your best recommendation for dark circles under your eyes? Are you looking at me again? No I'm looking at myself. Always go with Clarins. I'll keep that in mind for you. So beauty I've got a minute. I'm not probably the biggest customer so you'll have to excuse me here although I do like a decent fragrance. But isn't beauty such a crowded market? I mean I'm going to boots and super drag it on the high street. There's every marketplace out there. There are so many retailers out there. There are so many people on TikTok selling beauty out there. How do you set yourself apart? How do people know that when they're buying Clarins they're buying it from Direct Beauty? How do you actually make yourself stand out in the noise today? Yeah it is very difficult because it is a very saturated market you could see. But I think because we've been doing it for so long we've developed I would say plans of what we know our customers want. The pricing is the main thing that's going to make us stand out and because we've developed relationships with suppliers over so much time we do find we're able to get very very competitive pricing. But then what I would say the next part is our delivery. We still are one of the few that offer free delivery no matter how much you spend. So if you bought something for £2.50 it's free. If you bought you know £90 it's free. So free delivery is one of the other. So I can feel Jordan next to me getting all excited because I think you just have a favourite things there. Number one is you make him money when you buy the goods not when you sell them you've got to buy at the right price. And delivery isn't that what live works and you are all about is everything for when you buy it to get the product to me at home. It is but interestingly what I'm most taken by is the concept that you're talking about human connection and those supplier relationships and the importance of that in being able to create a foundation that allows you to offer the right price point and the free of charge delivery that's going to tick the box for the consumer. So how are you if you if you've got those human connection which is fantastic because I believe so much in that side of things but where are you able to reduce your cost of operations so that you can afford to offer free of charge delivery. I think because we're still very much I would still say a family run business the team has been together for almost since the beginning and the workers that we have employed over the time have been with us for a very long time. I feel that that's maybe where we're able to save because we almost all look at it like our own you know child. You invested it because you've been there for 10 15 years. Yes definitely so you know if you're going to be doing a little bit of work you know there's loads of times I'm happy to do a little bit extra or to try harder you know to make sure that we get things out. But this is back on back to what you said George it's all about culture people relationship. And I just think in today's AI enriched world of robotics and machine learning and it's like we've lost the art of having a conversation making that connection enjoying the time that we spend together. And I've recently gone through a bit of an epiphany where rather than seeing things as a chore I'm trying to derive whatever pleasure I can out of them but it sounds so that's the way you're running your business is you're all in it together and you're all trying to achieve something your customers hugely important. I mean I as a consumer I'm coming in your direction. Brilliant we'd love to have you but yeah that's how we kind of that's how we see it's like you say you know with the world turning towards AI now I'm not sure if you got a chance to see the soul suppliers talk earlier. Yes so suppliers amazing the way he was so he's my new hero. Yeah it was really good. It was the one here today was saying it's like being an airport with a blanket of fog on the ground and that's the kind of the AI noise and the AI content that's being generated. And when the plane has to take off and it's fighting through the fog and it's through above the fog and that's when you see the real people that aren't just a. Yeah. The noise in the background definitely and I feel that that's the main thing he's talked about the human touch and I feel like now an AI is good don't get me wrong you know we all need it but when you see that human touch as a consumer I think that's what keeps you coming back you know we might not be able to get as many new customers are some of our bigger competitors but what we're very good at is retaining customers when they shop with us they tend to stay. What I love about AI is the fact it makes you so lazy. If you're doing a new creative for an advert AI can generate a hundred of you but then the human can still pick which one's best to resonate on. I mean it's just saving you time is it is not necessarily picking for you just giving you options yeah or revealing insights in data which you can then decide how to act on. But I'm sensing in your business a very healthy mix of people process and technology where you've managed to find the right formula for combining those three elements to create that perfect customer experience but you were saying earlier that you sell on a large number of platforms so how many channels do you have as a business. Which ones? Well we're on all of the main ones but Amazon was our first and then it was eBay we're doing with on by Cosmetify Tesco Market Blaze and our newest one has been Timu and that's been big new toy. The team is really interesting because they've literally been around it's not even a couple years is it. But have your sales been there how's the experience been compared to other platforms are those good as they say they are for sellers. It's funny that you asked that because when we was approached by Timu we wasn't sure at all about going on. I'm Cosmet they've got over 21 million customers in the UK which is almost it's got to be almost every household hasn't they. It's crazy you know their growth has just been phenomenal but for us we went on there and I think it was the fact that we had an account manager straight away and they told us look we're on board you. We did that a lot for marketplaces but they meant it they actually on boarded us they talked us through the steps and showed us you know what to do and if we had a problem instant contact they get back to us. And then what we found is that the sales just went through the roof and we were so surprised by it that we had to react quickly because you know we was doing so much more business I think it's 10 times. Within a month it became our most the most revenue through any marketplace is was Timu. So yeah it's been it's been really good but they're very very hands on with their with their retailers you'll get help from them a lot. So George I know Limwer supports Timu but we were actually the first the first platform to integrate the team. Real messaging any out of this is Timu is still relatively new and if you jump on now you'll get that account. account manager handholding, but if you wait five years until everyone's on there, they probably like many of the scales that we call me, maybe not being quite as easy to get the amount of help. It is, but I think the message for any retailer out there who is addressing. I'm sorry, it's teaming. But whoever's out there who's embracing new marketplace is adding the complexity of additional channels to their proposition. That's when a platform like Limworks can come in and really revolutionise the business because it enables you to scale without breaking you because our platform connects to all of those platforms, allows that inventory sink across and also all of the order management. But I imagine Timo has been phenomenal for you, not least of all because of the price sensitivity that you have, you're going to give instant gratification to the customers on Timo with your your price sensitive positioning. I still can't get over the tent. I know. It's in sales. How long have you been on there now? Oh, it's only been since June. June, July, August, September, and we've only just been to October. Yeah. And I love the fact that they reached out to you. Yeah, we was one of the, I think because when we jumped on there, we really went in with both feet, even they were shocked. They're like, we didn't think you'd get this many products on them this fast. And, you know, we was able to do it. But I think that point that you made about having a, a software that can help you do that is so important because otherwise you would be broken. You get yourself in a pickle, don't you? Few words. Yeah. You can't do it all manually. Have you guys embraced the live streaming phenomenon that you can get on TikTok and eBay and that kind of thing? Not yet, but I've been seeing a lot. I've seen a few booths here with it. Because I think that I think your proposition would fly in that medium. Yeah. And it's totally different to any other selling mechanism. So you'd have to be careful how you approach it. It's definitely almost getting a new team or getting outside agencies. It helps. Yes. I think so. I don't know if you've gone down the influencer route yet, but that could be hugely interesting for your brand as well. Yeah, we was hoping to speak to someone from TikTok today because, you know, that's when you think of influencer, you think of TikTok straight away. And it's definitely something where we spoke to others here today and they like, look, you've got to get onto this, you know, and we've our experience at jumping in with two feet with Timo. We're now a company that's made us like, you know what, we're having it being safe. Like we always used to be. Yeah. Let's just go for it. So come over and see us a little bit later. I'll let you talk to Laura and Laura will give you a personal introduction to TikTok. Definitely. It's been nice actually being here because I see it all my expectations. I think I've been half a day now and I've not stopped running around. It comes back to what George was saying earlier on, the sole, sole supplier guy. It's all about who you know, people buy from people and you grow your business and evolve your business through the network that you create. And this channel X Chris, this is down to you. My lovely has created a great environment for connection. Yeah. And I love channel X world for anyone that's not made it this year. It's the one time of year when literally all of the channels come together. I mean, today we've had Pinterest and you've mentioned Timo and Debellum's and Ebe and Amazon and the list is endless. But all of the suppliers to that channel industry and all of the retailers and brands that sell on those channel industries, channel X world is just a place to be. So come next year is. Well, and also if you haven't come this year, you haven't had a chance to see Chris's matching shirt and shoes. Just like, you know, the biggest loss ever. I'll find a new shirt for Nick. Well, I can say as a person who's been here for the first time, I agree with that. Oh, hardly. But I mean, it must be brilliant for you because you must be able to speak to most of the channels you sell on today if you've not already. Yes, I've actually been coloring them. So I've seen them all and I've been like, wow, I've got to get your deals. So that's been, you know, brilliant. But finding things that I didn't even know was possible, you know, like I was speaking to another coming about listing products and things like that. It's, you know, even banking. But that's the power of this is and I, I'm so my discipline is marketing. And I sometimes will break away from my day to day job to go to a marketing conference because you don't know what you don't know. Oh, yes. And by going to those conferences, sometimes you get the latest and greatest information and it can revolutionize your day to day work. Most definitely, most definitely. So I'll always be back. You won't be able to get rid of it. I'm delighted to be here today, aren't you Chris? I am because it's, excuse me, as much as I love my job about writing about e-commerce channels, I love even more meeting the retailers like you Dean. I've never spoken to you for the first time. And it's just a fascinating story. I would have never known that the huge power team is it? I changed your business 10 X and literally four months. Yeah. And this is a business that is not a new business. It's in a high growth phase. I've been going since 2011. So it's a pretty well established. Been around the block, you could say. 14 year old business. And suddenly you said change like that. And I would love to come back next year and find you launched on tick tock shop and ebay live and done another 10 X increase. Yeah. That would be lovely. I'd like that. That's great. Yeah. That's a challenge for you Dean. Yeah. Come back next year. Yeah. And actually, I'd love to know how it goes. Whether it's a huge success or a huge failure, we'd love to know your learnings on it. Because not every channel works for everyone. No, absolutely. It may be that team is the place for you and she isn't or maybe she isn't tick tock isn't or maybe tick tock isn't somewhere else isn't. Maybe they all are. Maybe they all are. In which case you've got a real problem and you're going to need some super duper software solutions. I'm Georgia. I can see you smiling away in the corner. Well, I know where I'm going after this. Let's just see that. But no, Dean, I want to thank you so much for your time. Thank you guys for this. Absolutely. Fascinating. Georgia, anything else through you? No, I'm delighted to have met you, Dean. I have a feeling that this is a connection that's going to last for quite some time. Me too. I definitely agree with that. But thank you guys so much for having me. It's been really a blast. It's a pleasure. Thank you.