e.l.f. Beauty: Crafting a New Narrative in Cosmetics for Gen Z

In the ever-evolving world of beauty, e.l.f. Beauty stands out for its commitment to embracing modern consumer demands without compromising its identity. With an impressive track record of consistent sales growth, this affordable cosmetics brand has strategically captured the attention and loyalty of Gen Z shoppers.

A Unique Approach to Beauty

e.l.f. Beauty expertly blends affordability with quality, utilizing viral trends from higher-end brands and marketing that resonates with younger audiences. After achieving 28 consecutive quarters of sales growth, this strategy has proven effective.

In May 2022, the company took a bold step by acquiring Rhode, a cosmetics and skincare brand launched by Hailey Bieber, for $1 billion. This move is part of CEO Tarang Amin’s vision to transform e.l.f. into a modern cosmetics powerhouse that not only meets but leads consumer expectations.

“We want to be a different kind of beauty company.”
— Tarang Amin

Ambition Meets Challenge

While the company’s aspirations are impressive, e.l.f. Beauty must navigate various challenges, including tariff impacts and shifting political landscapes that can affect diversity, equity, and inclusion (DEI) initiatives. As the excitement around copycat products begins to wane, e.l.f.’s future as a global player hinges on the success of its new acquisition, Rhode.

Amin, originally from Kenya with Indian heritage, has been at the forefront of this transformation since he became CEO in 2014. He emphasizes the importance of understanding consumer needs, often relying on his dynamic young team to guide the company’s direction.

“Some people who came to us from bigger companies were shocked. They say, ‘God, these are your nuclear codes.’”
— Amin

His insights highlight the significance of social media engagement, particularly platforms like TikTok, where trends explode rapidly.

“If Gen Z is there, then yes. And what is TikTok?”
— Amin

Adapting to Growth

In 2019, e.l.f. Beauty underwent significant restructuring, closing 22 physical stores and reallocating resources towards marketing and partnerships with major retailers like Target and Walmart. The brand’s online presence flourished, with popular products like the $11 Primer Poreless Putty and $14 Halo Glow Liquid Filter going viral on TikTok.

With an eye on virality and engaging campaigns, Amin describes e.l.f. as “an entertainment company that sells cosmetics.” This strategy has helped merge lifestyle branding with luxury offerings, particularly through the Rhode brand.

Rhode launched in 2022 with only ten products but quickly garnered impressive sales, reaching $212 million in its first fiscal year. Its strong brand identity and image resonate well with consumers, who find value in both the lifestyle and products offered.

“People buy into the whole brand, the lifestyle, and the products.”
— Amin

A Vision for the Future

Amin believes e.l.f. can thrive in various retail environments, from discount chains to upscale stores like Sephora. With over 120 potential brands for future acquisitions, e.l.f. is striving for a future that extends beyond mere imitation.

Rhode’s introduction to the market has positioned it as “accessible luxury,” with products ranging from $20 to $38. This enhancement to e.l.f.’s offerings also represents a key driver for sales growth.

Navigating Political and Economic Pressures

In 2022, e.l.f. raised its prices by $1 due to tariffs, highlighting a significant portion of its products manufactured in China amidst ongoing trade tensions.

Amin emphasizes transparency in pricing decisions, fostering an honest dialogue with consumers. He stands firm on the company’s commitment to DEI, believing that backing down would alienate their community.

“In truth, it would be risky to back away from what we stand for. Our community will notice it immediately, and they will hold us to account.”
— Amin

e.l.f. Beauty’s marketing tactics have included provocative campaigns that reflect contemporary societal themes, including the recent “Soooo Many Dicks” billboard campaign promoting DEI discussions.

Conclusion

e.l.f. Beauty is not just a cosmetics brand; it embodies a dynamic approach to modern beauty standards that resonates with Gen Z and beyond. With its innovative strategies, commitment to genuine engagement, and a forward-looking vision, e.l.f. continues to redefine what it means to be a contemporary beauty brand. As it navigates the complexities of the market, its focus on inclusivity and strategic growth promises to shape the future of cosmetics in exciting new ways.