The Beauty Salon Comes To Your Home: Meet The Woman Who's Helping Rearchitect An $18 Billion Market

A couple of months ago, I penned an article that began with a confession about my connection to the retail industry. Not only is retail innovation a huge part of my focus as a consultant. It's in my blood. Family, in-laws, and friends of mine have all toiled in various sectors of the retail business. And so have I, as the former co-owner of a small professional theater company. It's given me a sharp perspective on some of the challenges facing retailers today.

The question: at a time when the very notion of retail itself is being challenged -- with the rise and threat of e-commerce, in-store pick-ups, and home delivery -- what in fact is a "store" today?

My answer: it's not so much about the place where you store your goods (there are new means and methods for that). It's wherever you physically need to be to effectively serve your customers today.

Increasingly, entrepreneurs are looking for ways to modernize retail sectors by reimagining the physical venue for delivering certain services and products. For the $18 billion personal care-and-beauty market ($12 billion in services, $6 billion in products), the time may have arrived to reinvent what the store actually is in and how it might benefit the different stakeholders in the value chain -- personal care/beauty assistants, the brands that are struggling to connect more meaningfully with customers, and even traditional retail outlets (the salons that hire assistants and the big-box chains with whom brands have historically engaged to sell their wares at cosmetic counters).

There are at least three reasons why this might happen. It begins with the very real problem that so many consumers of personal care-and-beauty services are struggling to align their busy schedules to the limited availability of appointments at salons.

On the recommendation of a friend, I met Anna Santeramo, CEO and founder of SF-based StyleBee (which is headquartered in a most amazing two-level space above Green Apple Books & Music, a legendary SF store which itself has had to undergo a great transformation) who faced this very problem when working as a corporate attorney in NYC. Like other successful entrepreneurs, she saw an opportunity to address her personalchallenge -- a challenge that many others share -- at scale. What she quickly discovered: the industry has a real-estate and inventory problem. Why: the industry is too fragmented and the most desirable salons are too small to meet the demand for services when one needs them and whereone needs them.

The solution is to liberate the stylists from the physical constraints of their stores (where they can continue working) and provide them with many new physical spaces where services can be delivered: people's homes today, and workplaces in the near future. Among the services provided: blowouts, updos, make-up, manicures, pedicures, and men's cuts, too. Launching in 2015, the company enjoyed a quick path to business, not just because it solved a problem for executives like Santeramo, but because it created more jobs and better wages as well. She got a lot of love for that. "We created an army of advocates," says Santeramo. In more than 400 municipalities today, StyleBee recently turned cash positive and investors are taking notice.

Brands That Need Better Engagement

But Santeramo is also looking to solve a big problem for another kind of stakeholder in the personal care-and-beauty market: the brands of products (makeup, shampoos, and other items) that have traditionally relied on small salons and big-box makeup counters to connect with consumers. The stylists and assistants who serviced those stations have always served as trusted brand ambassadors, selling for the brand in soft but engaging ways. So naturally, if those stations are failing to meet the consumer where she lives (or works) an age-old strategy becomes obsolete. In recent months, Santeramo has been in discussions with a number of high-end brands that see the value in StyleBee's army of advocates. The trusted advisor lives on. There just happen to be more venues for them -- the theaters of love and war for the army of advocates. Most StyleBee customers make room in their kitchens -- the busiest venues in their homes -- for StyleBee services.

The Data That's Helping To Reimagine Retail

And this where it gets really interesting, from my perspective. Because StyleBee services are scheduled over the Cloud, and an e-commerce engine has been integrated to follow-up with customers in the same soft and trusted way that its offline army comports itself, it appears to have built a data and distribution platform for understanding, serving, and engaging the customer over the lifetime of that relationship, answering questions like, where do my customers live? What products do they most care about? How often do they use them? When is it time to replenish those products (StyleBee is experiencing 50% growth from repeat customers)? What can the data predict about the future appeal and viability of services and products in the large personal care-and-beauty industry? These are all questions that Amazon potentially can answer, if they ever get into your home to provide these services. But with StyleBee, brands can answer these questions leveraging an independent platform.

As I have learned in my many tours of duty in retail, "data is the new oil" -- an imperfect, often criticized, but useful metaphor attributed to Clive Humby, one of the pioneers of retail customer data who launched his first big business with his wife, Amelia Dunn, right out of their kitchen -- that's helping to fuel the reinvention of retail across different sectors. And it's the first line of defense against e-commerce players which have shown deep interest in the offline world because people still want and need offline retail experiences that are in great demand ... like personal care-and-beauty.

That's the opportunity that Santeramo is chasing, and she's doing it very well. Again, the "store" is wherever the vendor needs to be in order to serve the customer. It's a reality that her company is fully embracing, and with the power of the great democratizer of modern retail: customer data.

Forbes