By Corey Huggins, Founder, Global CEO & Managing Partner, READY to BEAUTY
This Spring & Summer, the COVID-19 pandemic has been a gut punch on the lives and businesses of the multicultural beauty community. It upended everything from consumer activations to disrupting the supply chain all while exposing long-standing racial disparities in healthcare, business and economic opportunities alike. As a result, in recognition of National Black Business Month, Cosmoprof North America launches a 2-part series exploring the economics of Black & Brown beauty in 2020.
By all accounts, the Multicultural market, commonly known as Black & Brown beauty, is a robust segment to the sales ring of $7.5 billion dollars annually in the United States (ESSENCE Magazine, Smart Beauty Study 2018). This success is predicated on the backs of consumers’ overwhelming need for addressing their unique curl patterns and particular shade ranges, not on having a paved road for Entrepreneurs & Brands to enter the market. Everything from barriers to trade, lack of funding to even having a Mentor has made each and every win in this market a hard-fought victory! Consequently, when the COVID-19 pandemic hit the United States, Black & Brown beauty felt its impact like no other segment in our industry.
COVID-19 + Multicultural Beauty
While the effects of the pandemic were straining on the economy in general, Black & Latinx businesses suffered the most in the United States. Research indicates that in the early months of the pandemic, 41% of Black-owned businesses shuttered and Latino-owned businesses fell by 32%. In contrast, only 17% of general market businesses closed during this same time period (VOGUE Business, Lacking Financial Support Black Owned Businesses are Suffering, July 2020). And specifically, from a Black & Brown beauty perspective COVID-19 has been devastating! Gone is an entire revenue source for multicultural businesses that arose from the “Cash & Carry” show circuit being summarily cancelled. The ban on large gathering events prevents multicultural business from reaping the unique sales benefits from a season (April-August) of beauty events. Therefore, this new reality has forced Entrepreneurs & Brands serving the multicultural market to become more resourceful and very creative. By way of example, this market is now rife with unprecedented collaborations and entities that otherwise would not have happened like The Lip Bar and Urban Skin Rx. These two dynamic duos have gotten together in the name of #strategy for a “skin care is the first step in any makeup application” conversation stressing the importance of working together for mutual ‘brighter days’. Moreover Melissa Butler, Founder of The Lip Bar, started the @theblkpact as a pledge of allegiance for Black Businesses to work together for a common good during these uncertain times.
But COVID-19’s cascading domino effect of loss still presses hard for the entire Black & Brown beauty ecosystem, from all the ancillary/cottage industries to social media influencers. No one is getting work as a result. And what happened to all those multicultural beauty businesses that were using the “cash & carry” events as their lifeline?! Gone too. Alternatives forms of financial lifelines all but don’t exist for businesses of color. Further research indicates that in terms of bank bridge loans, Black and Latino businesses were less likely to be approved, compared to general market businesses (47% vs 75%). (VOGUE Business, Lacking Financial Support Black Owned Businesses are Suffering, July 2020).
Additionally, as all of us in the industry already know, the closure of salons and barbershops across the country was just another layer of the economic fallout of COVID-19. But it was a crushing consequence for multicultural beauty in the face of the importance of the hair care segment business. Reports indicate that as much as over a third to nearly half of hair stylists and barbers were forced to cut hair in their homes out of necessity and thereby increase their chances for COVID exposure. And the implications are clear: economics is one of the many reasons why the Black & Brown community is over indexing in the United States for COVID infections. However, yet again, the resourcefulness and creativity of this market prevailed with entities like Ivy Digital’s full on virtual fundraiser conference for Black & Brown Salons + Barbershop Owners/Renters entitled “Pivot to Profit.”
By way of history, during times of economic downturn, sales in the beauty sector increase in what some call the “lipstick effect.” Small indulgences such as beauty products help people feel better while not putting too much strain on their budgets, as opposed to major purchases. But some say the economic collapse and financial instability sparked by the COVID-19 pandemic is different this time, in part because consumers are socially distancing and shopping in-stores less. This new phenomenon has produced an indirect employment loss for the many Black & Brown women working as skin-care specialists, nail technicians and other personal care professionals. As a note, Black & Latino women are “more likely” to be employed in lower-paying service occupations than their General Market counterparts (Nail Files: A Study of Nail Salon Workers and Industry in the United States, 2018); and therefore, contribute to the higher rates of unemployment during the COVID crises of the community.
Last, the impact of COVID-19 on multicultural beauty is continuing and its effects may be lasting. So how can we as an industry support Black & Brown entrepreneurs & brands?! There are 2 really simple yet effective ways:
- mentor/sponsor Black & Brown entrepreneurs
- do business with Black & Brown brands
They are not rocket science, but the results will be complex and trajectory changing.
Moreover, as Founder & Global CEO of READY to BEAUTY, we have a capital growth fund under the banner Ready to Invest and are helping brands with distribution, purchase order support and even direct investment too. This Fall, READY to BEAUTY has a bold agenda and will be launching a series of initiatives all aimed at #strategic development and educating entrepreneurs & brands of color. So, while it has been a time of challenge, it also has been a time of opportunity, creativity and innovation. This community has “make a way out of no way” in its DNA. Consequently, stay tuned for yet another incarnation of Multicultural Beauty. The resilience of this community never ceases to astound me. It is like no other….
Stay close Part 2: Beauty meets #BlackLivesMatter
ABOUT COREY HUGGINS
Corey Huggins is the Founder, Global CEO & Managing Partner of READY to BEAUTY, LLC. As such, Huggins is globally driving the beauty conversation in the multicultural space. With collective years in Marketing & Strategic Planning for CPG and beauty giants like Kraft, L’Oreal USA, Ales Groupe, Mana Products and Beauty Trend USA Huggins has charted the strategic direction for powerhouse brands like Maybelline, Kiehl’s Since 1851, LOGICS, MIZANI/Soft Sheen Carson, Phyto/PhytoSpecific Hair Care, Black Opal and Glossybox USA. And now with the launch & expansion of READY to BEAUTY, the first-of-its kind global “think tank” for Multicultural Entrepreneurs & Brands, Corey Huggins is ensuring that qualified persons of color, whether it is an entrepreneur, brand founder or future company executive has a more paved road to walk for success and legacy creation.
ABOUT READY TO BEAUTY
READY to BEAUTY is the Industry’s First Global Think Tank for Multicultural Entrepreneurs & Brands. We function as a Business Designer, drawing the blueprint for Multicultural brands’ success and offering them expertly tailored ready-to-go to market assistance for starting, scaling & growing beauty businesses. Each season, READY to BEAUTY assembles a stunning collection of industry insiders and innovative business themes combined with its expertise and best practices, all constructed to embrace and enhance the multicultural beauty market. READY to BEAUTY is comprised of the most seasoned and knowledgeable beauty executives in the Multicultural market. Its senior staff are all former L’Oréal USA executives, vendors and global business consultants.
Categorized in: Trends/Insights