Austin Hankwitz (00:00):
I'm Austin Hankwitz, and this is After Earnings, the show that brings you face-to-face with the executives behind the world's most interesting public companies.
Katie Perry (00:09):
And I'm Katie Perry. I'm wearing Elf Cosmetics. And today we are chatting with the CEO of Elf Cosmetics Tarang Amin. Now ELF is a high flying stock. It's up over a thousand percent In the past five years, they've really made a name for themselves by selling high quality, affordable makeup, and they've since even expanded into skincare.
Austin Hankwitz (00:28):
We also got into their earnings. Get this Elf just posted their 21st straight quarter of growth over 20%, and they're building momentum off a major skincare acquisition. They also have expanded shelf space in places like Target and Walmart, and they also just had a big campaign in partnership with the video game. Roblox. We talk about all this stuff in the interview, so let's jump into it. What's up everyone? Welcome back to this episode of After Earnings. We're joined by the CEO of Elf Beauty, te Amin. Te, thanks so much for hanging out with us.
Tarang Amin (01:02):
Well, thank you for having me. I'm looking forward to this.
Austin Hankwitz (01:05):
Oh, so let's just jump into things, right? You guys have been public for over eight years and your stock price is up over 1000% throughout the last five years. You continue to take market share from your competitors while growing profits and expanding your margins. Your average product costs $6 and 50 cents compared to about $10 with other cosmetic brands and 20 for the luxury brands. So one, what drew you to this business back in 2014 and two, what key lessons did you learn over the last 10 years of building an $11 billion empire?
Tarang Amin (01:41):
Well, thank you again for having me. What really attracted me to this company was the disruption that was there from the very first day. Alan and Joy Shama, the founders had created this company in 2004, selling cosmetics over the internet for $1. Everyone thought they were crazy. This is 2004 before the iPhone, you couldn't sell cosmetics over the internet and you certainly couldn't make money at a dollar, but they had figured it out. And that initial kind of disruptive gene has kind of stayed with us all the way through. And so when I got involved, it was about 10 years ago, the company had just gotten distribution at Target, a national retailer. The e-commerce business was still growing really fast. And so I saw a huge opportunity in terms of continuing to build out the team and really hone in on the advantage that I saw that was such a disruptive company. And even today, our vision is to create a different kind of beauty company that disrupts norms, shapes, culture, and connects community through inclusivity, positivity, and accessibility. And it's working.
Austin Hankwitz (02:44):
It absolutely is working. Do you have any big takeaways or lessons that you've learned since this awesome 10 year journey that you've been on?
Tarang Amin (02:52):
Yeah, I think it's the importance to continually hone your strategy and continue meet the change that you see out there. We had a couple quarters in 2018 where our business was down slightly because we had missed a lot of the big mega influencer wave in terms of a lot of the Budda beauties, the Fenty, the morph fees as they came in. I thought our value proposition would insulate us and what we found was that wasn't enough. We needed to do more in terms of engaging consumers, really honing in on our innovation model and our productivity in store. And that's really the strategy we put in place in 2019 and we're still seeing the benefits of it today. So I think the biggest lesson for me is you can never stand still, particularly in a dynamic category like ours where you have a lot of competitors, you always need to make sure that you're delighting consumers better than your competition is.
Austin Hankwitz (03:43):
Well, we're definitely going to get into the creator stuff, but I'll let Katie jump into the next question. Yeah,
Katie Perry (03:47):
I mean, just on the momentum front, looking at your website, you guys have a press release out every two weeks with something amazing happening. So I hear you on the momentum and I've been a user of your products for a long time. We were talking about it before the show, big fan of the camo concealer. My mom uses the products, my friends. So this is a really fun moment for me. But what I want to dig into is how do you guys balance having high quality products with the affordability? I think people who have been to Sephora lately, you could throw five things in your basket and it's $300 like that. So what's sort of the secret sauce there to bringing those two things together?
Tarang Amin (04:32):
Well, that was the insight from the very beginning. And really when I got involved 10 years ago, I thought if you could actually have prestige quality at incredible price points and have that value proposition, you'd be unstoppable. So we've really engineered our entire operating model to have integrate our innovation with supply chain that gives us the best combination of cost, quality and speed. So we can have that level of prestige, quality, but at a fraction of the price. And that really resonates with our community.
Austin Hankwitz (05:03):
I think that's incredibly powerful. I mean, I don't know too much about makeup, but I've definitely heard from my friends that you guys are crushing it at the balance of quality and price. So I mean, Katie hit the nail right on the head there. Now you've talked a little bit about the sort of influencer wave back in 2018. Some of your competitors were really leaning into that and that kind of puts you back on your heels for a second. So since then pushed forward, you're now working with influencers, I'm sure. I mean I saw a bunch of stuff about it on your website. So how do you guys actually measure the perceived value of working with influencers and content creators? Is it an awareness play? Are you directly tracking revenue growth? How are you guys really working with them in a way that drives revenue and shareholder value?
Tarang Amin (05:52):
Well, the way we work with them primarily is quite different than a lot of our competitors. Many of competitors will do sponsorship deals with big influencers, pay them a lot. We rarely do that. Most of the posts that come to On Elf are organically driven and the reality is ELF is a great brand for influencers to promote because of our value proposition. They can get on and tell their communities of, you don't have to spend $50 for this thing, you can buy it for seven at Elf. And they'll do the demo on social where they'll show like, wow, the benefit and the payoff is just as great. And it actually ends up being not only a great thing for the Elf brand, but a great thing for their brand because they're bringing real value to their audiences. So that's primarily the way we work with them.
(06:36)
I would say the second thing for us that's probably different than a lot of other brands is we're very community driven. So whenever I see a product take off, we just have to go on TikTok and see that a normal consumer posted on it and it got a lot of followings and other people started doing it. And even in our As, like I said, we can deliver prestige quality to extraordinary prices. We never make the comparisons ourselves. Our community does it for us. We had a launch recently, our bronzing drops that just launched a month ago that was came to us directly from our community. Our community would come to us and say, Hey Elf, there's a prestige brand out there. They have these bronzing drops, we love 'em, but they're $36. I can't afford $36. Please help. And so we'll take a look at that. We will study the product, we'll put our elf twist on it, we'll make sure what do people like about it, what don't they like about it? And then really focusing on the value. We introduced our bronzing drops at $12 versus a prestige item at $36. And the community goes crazy because one, they were asking for it. And two, our ability to move quickly and address that in a way that gives them an incredible value continues to fuel our success one launch after another.
Katie Perry (07:49):
So glad somebody disrupted the $36 bronzing drop market. We thank you. But it also sounds like in addition to kind of the creator strategy, would you say that a lot of the growth is like word of mouth, this some sort of, I got a deal or I really love this product, but it's accessible to all of my friends. Do you think you guys have a word of mouth advantage compared to more expensive competitors in the market?
Tarang Amin (08:21):
I believe so. And if you look at the historic model of a lot of the legacy companies that we compete against, it was a very advertising driven model. They did a lot of tv, a lot of print, a lot of celebrity endorsement. Our focus is directly on delighting our community. And so if you look at our strength on social, it really plays to having our community have a voice in the brand and being able to promote the brand. And that's really helped us. And when I said time after time, even things that we've had in our lineup for 10 years, all of a sudden you'll see something take off because the new consumers discovered it and tells world about how great this is. And so that's definitely something that's core to our model, which is different than what I call a traditional ad-based model. It's very much community driven.
Katie Perry (09:04):
Yeah, it makes sense.
Austin Hankwitz (09:06):
That's powerful. I mean, if you have a community of customers that are in love with your products, they're not only going to purchase the product, but they're going to tell everyone about it and the massive value prop that comes with it. So you guys seem to have really figured that one out. Moving forward now to your recent quarterly earnings, wall Street was thrilled about your quarterly report with some sell side analyst adding you to their analyst current favorites list. Congrats to me, it seems like you guys are certainly setting yourselves up for another year of top line momentum ahead of your peers, catalyzed by further shelf space gains, which we'll talk about here in a little bit, as well as expansion into international markets and margin expansion. So my question is, what's the secret? It seems like you guys are building this incredible flywheel. How are you guys just executing upon these stellar earnings results quarter after quarter after quarter for what seems now? I think I saw in your earnings deck like 22 quarters in a row of just continued growth.
Tarang Amin (10:07):
Yeah, I'm proud of the fact that we just completed our 21st consecutive quarter of net sales growth. We're one of only five public consumer companies out of 274 that's been able to do that for not only 21 consecutive quarters, but also averaging at least 20% growth a quarter. And I'd say the consistency of those results is really driven by three fundamental drivers. The value proposition we've been talking about, prestige, quality, these extraordinary prices, a powerhouse innovation model that allows us to create these holy grails products you could only find in prestige that we're able to put our elf twist on and get at an incredible value and our marketing engine, which knows how to engage and entertain our community. All three working together to be able to drive the results that you've seen.
Austin Hankwitz (10:55):
That's incredible.
Katie Perry (10:57):
And going back to what you shared in your earnings, it sounds like about a quarter of your revenue is focused on marketing efforts. And you mentioned obviously there's the traditional advertising. I think you all had a Super Bowl ad this year and those things exist, but you also seem to have a lot of really interesting and creative partnerships that are completely off the playbook. And one we want to talk to you about is this partnership you just announced a couple of days ago with Roblox. So for those of us who aren't in that community or gamers, what was that all about and what kind of audience was that specific campaign aiming to reach?
Tarang Amin (11:41):
Sure. So we as a digitally native brand, we're always testing and learning on new platforms. We're one of the first brands to go on TikTok. I think our latest hashtag challenge on TikTok generated 15 views. We're strong, oh my gosh, Instagram. Yeah, it's incredible the amount of reach we can get through our digital approach. We're strong on Instagram, we have our own channel on Twitch, and we continue to take success from one platform and take it to another. And so the particular insight here, it actually started with our gaming initiative with an insight that almost 70% of our community are gamers and a high percentage actually watch others play video games. That created an opportunity for us to go on Twitch with our own channel partner with FU the world's second most popular female gamer on female empowerment. We saw such great success with that.
(12:35)
We said let's keep going. And so if I looked at kind of within Twitch, it helps play to the strength that we have, particularly with Gen Z, we're the number one brand amongst Gen Z by a wide margin, almost 38% Mindshare compared to I think the next highest brand is Selena Gomez is rare at about 8%. So really strong amongst Gen Z. We're also the number one brand amongst Gen Alpha. So the insight for Roblox really came from how do we continue to entertain and engage Gen Alpha? So we created our own branded experience on Roblox, ended up being the number one branded experience on the platform. I think over its 96% rating, over 13 million plays. And we saw great success. What we tend to do is we tend to say when something we can find that it's entertaining people, it's engaging, they see that.
(13:21)
Let's take it a step further. So a couple days ago we announced we're actually doing digital commerce on Roblox, where we've sold actually quite a few skins, the virtual skins that you can buy on Roblox. So we said, let's take it a step further and do actual physical commerce on the platform. And again, it builds on this constant theme of testing and learning and trying new things. We're one of the first brands, I think we're the beta for TikTok, shop for Beauty, and we're seeing great success there. And so it's just part of this digital ecosystem, which really basically our mantra is we want to live where our community lives and we want to do things in a native way that really engages and entertains them. And so that's why you see us do all these unexpected things, and particularly being the first in a number of 'em,
Katie Perry (14:09):
I love that because you think about some of these legacy beauty brands and I'm just picturing somebody in a boardroom and some young whipper snapper comes in with a gaming strategy and getting just laughed out of the room. So you guys definitely are doing something different and got to shout out your CMO, Corey. I'm in the marketing world and when I was telling people about this show, they're like, is it Corey? People know your CMO by name because you guys are so consistently great at marketing, so appreciate that.
Tarang Amin (14:40):
Corey is terrific. She's a bold, visionary, unstoppable amount of energy has, but the thing that I think a lot of people don't realize is just how strong the team is that Corey and the rest of my exec team have built. So if I take a look at our integrated marketing team in la, which has come up with all sorts of crazy things, particularly on the engagement with whether it be influencers or with pr, it's amazing. Our digital team, our innovations team, that's actually, I think the real strength that often doesn't get talked about in Elf is we have a unique team and a high performance team culture that allows us, to your point, not traditional where anyone can have a great idea, anyone can go do it. We're not afraid to fail, we're afraid not to try something. And so it's kind of the opposite mentality of mitigating risk. It's let's embrace what's new and let's learn and we don't have a problem failing. We'll take those learnings and continue to move. And I think that speed of decision making also helps. You mentioned we did our first Super Bowl lad I think two years ago with Jennifer Coolidge that went from initial concept to airing in about three weeks. Wow. Oh my
Austin Hankwitz (15:55):
Gosh, that's crazy.
Tarang Amin (15:56):
Most companies take them like 18 months ago, do that. So it kind of tells you a little bit about the DNA and the spirit within the company that we allow. And a lot of it goes back to how we've both comprised the team, the diversity of our team, almost over 75% women, over 60% Gen Z and millennial, over 40% diverse. They represent the community we serve. So there isn't the need, I got to go do a focus group, I got to do a lot of studies. Our team actually is our community and that gives us a tremendous advantage all the way up to our board. But the other thing between the team is also we have a different philosophy. We're unique in our space, we believe amongst all consumer companies and we grant equity to every single employee every year. And so it really does create a team of owners who really care about the longterm and we've seen great results from that.
Katie Perry (16:53):
That's amazing. It definitely shows.
Austin Hankwitz (16:56):
Yeah, Katie, I don't think we've talked to a company yet that is so focused on shareholder value and granting equity and ownership as well as just making sure that the exec team and the employees of the company also reflect the communities that are, I mean, you guys are really crushing it. And I mean, I'm not saying that I'm an expert with Gen Z or millennials, I'm 28 years old, but the fact that you even know what Twitch is I think is a pretty cool thing.
Tarang Amin (17:25):
Well, I think that the great thing about being the CEO of Elf beauty is it keeps me young. I remember a few years ago when Corey came to me and said, Hey, we have to be on TikTok. That's where Gen Z is. I'm like, well, if that's where Gen Z is, we definitely have to be on TikTok now what's TikTok? And so it's constantly forcing you to learn new things like what's the skin on Roblox? And oh, they're following it. And part of these unexpected partnerships lead to other things that we're constantly learning. Another unexpected partnership we did a couple months ago was with Liquid Death, also another kind of Gen Z favorite kind of water brand that's really quite disruptive. We put both brands together and we did this limited edition Corpse paint that sold out in minutes, had billions of views, and then we take that a step further, we say, wow, this liquid death L thing's doing great. Let's put some liquid death skins on our Roblox experience. And we found out we sold over a hundred thousand whoa liquid death skins. And I'm like, wait a minute. People are paying for because of the liquid death collaboration. And so these things tend to build on each other and you can definitely see the momentum as we continue,
Austin Hankwitz (18:35):
Well sort of flipping out of digital and back into in-store in retail here, you guys recently expanded from an eight feet shelf space at Walmart to 12 feet, just skipped right past 10 feet. There are some legacy brands that are at Walmart that have 20 feet, but you guys are turning products over at two to three times the rate that they are. You're also expanding inside of Alta Beauty. You noted actually in one of your previous earnings calls that the net new shelf space would provide some upside to your current financial guidance. So you guys are obviously seeing these improvements. My question is what kind of upside now should investors expect considering this expansion is real?
Tarang Amin (19:16):
Yeah, well I'd say as much as everyone loves space expansion and we, we've had a consistent track record of picking up more space, we're still the most under spaced brand in our space. I always give the example of nationally, we just passed L'Oreal to be the number two brand in color cosmetics with about a 12% share. But at Target, our longest standing national retailer where their number one brand with over a 20% share. So we're pretty confident just in our core category of color cosmetics, we can again double our market share over the next few years. Skincare, we have two of the fastest growing skincare brands in Elf Skin and Natatorium, and we're in the early days of Natatorium. So we see, I think as great as the growth has been, what I'm even more excited about is the white space that's ahead of us.
(20:00)
And even back to the space conversation, as good as the space gains have been, our number one driver with our national retailers is we are quite focused on productivity. A lot of brands in our space will wait till SKU doesn't do that well and the retailer will discontinue it. We never do that. We proactively change out 20% of our SKUs every year because we have data off of our e-commerce site that we know what's going to sell, where the reviews are and we'll proactively change out these SKUs. So it ensures very strong productivity growth year after year. Last year we mentioned before Ulta expanded their space without any space gains. We grew that business over 70%. We had a similar stat within Target in terms of what we're able do. And it's really based on, again, being different, not waiting for someone to have an issue with a product, but actually proactively going after productivity. And so I think between that productivity model, which continues to earn us more space and the white space we have ahead of us, there's still quite a bit of growth to be had.
Austin Hankwitz (21:06):
Most definitely. And you mentioned, I think you said Nirium, is that how you pronounce it?
Tarang Amin (21:10):
That's right.
Austin Hankwitz (21:11):
Okay. So that was a recent acquisition and you guys are, I think now putting that into Ulta Beauty, what's the story there? What's the incremental revenue or perhaps margin? Walk us through some of that.
Tarang Amin (21:25):
Yeahium, we acquired Natatorium in October of this last year. And what really attracted to Natatorium is while there are many brands in our space, very few are able to scale. I mean, I think there are only out of 1800 brands tracked by Nielsen in cosmetics and skincare. There are only 28 that have more than a hundred million dollars of retail sales. Natatorium went from zero to 90 million in net sales in less than three years. So we knew there was something special here. Reminded me a lot of elf in terms of its growth profile. But what we really loved about Natatorium is a compliment at our existing portfolio. Natatorium is a clinically effective biocompatible skincare brand developed by Susan Yara, founded by you Susan Yara. And the quality of these products is just unbelievable, but also continues to be accessible. Averaging at retails for natatorium are $18 that while higher than Elf Skin at $9, still significantly incredible value relative to what they compete against.
(22:25)
The other thing we liked about it is while Elf Skin is Gen Z and mainly women in focus, a natatorium is millennials and 40% of its user base is men. So we love the fact that it was also a very fast growing brand with lots of white space. And then what we particularly liked about, it's the only place we were in distribution when we bought the brand was in Target, amazon and natatorium.com. So we knew we could also continue to grow its presence in Target, we're the number one brand but also continue to expand. And so we're very excited. Actually it's next week I think that we start the Alta Beauty expansion and I know they're quite excited about it as well. So I love the fact that we have two complimentary skincare brands that go after different audiences and both of 'em are amongst the fastest growing skincare brands. And so it definitely helps us with our strategy almost doubles our presence within skincare to 18% of our business.
Katie Perry (23:18):
So Teang, I got to ask you, what is your skincare routine?
Tarang Amin (23:22):
It's so funny, my skincare and cosmetics regimen is much simpler than most of our team. So like today, I will tell you I started with our holy hydration moisturizer. Everyone needs to moisturizer skin. I use the one with our SPF 35 because you also need sun protection. I then use our matte and poreless putty primers because older and I need to kind of work out all these pores that I have. And then on top of that, I basically use the hydrating camo concealer for my eyes and then underneath I use one of our powders just to take the shine off. So I do that for media interviews. You look great. And then normally though from skincare, I mean we have particularly between Natatorium and Elf Skin and Key SoulCare, which is another brand we have, we have incredible skincare products. So I'm always trying new things as we go through. So definitely simple routine cleanse, moisturize, some usually sun protection. And then depending on what the look is, we'll go from there. But I'm still exploring, still learning and love. Actually one of my new favorite products is the Nirium vitamin C serum. It's an amazing product that, and the great thing about Natatorium is super effective, but it feels great on your skin as well.
Katie Perry (24:44):
Austin, are you putting vitamin C on your face or are you bar soap guy? I'll tell
Austin Hankwitz (24:49):
You what, Turang, I need some links, man. I need some help. I need you to send me some links to purchase these
Tarang Amin (24:55):
Product thing where you can get started. Start with silver and NA Auditorium body products. The body wash is the glow getter. Body wash is a game changer. You'll never go back to soap again.
Austin Hankwitz (25:07):
So for me, I'm a bar soap on the face in the shower type guy. And then I use a towel to towel dry my hair and my face. And then if it's really sunny outside, if I'm going to be outside all day, I'll put on Harry's has this daily face moisturizer S pf 15. Then I'll put a little bit on my cheeks and my forehead. I'm sorry, but that's about it.
Katie Perry (25:30):
One five.
Austin Hankwitz (25:32):
One five. Yeah. 15. Is that not enough?
Katie Perry (25:34):
No, dude,
Tarang Amin (25:40):
We'll have to get you some of our untouchable invisible sunscreen. I think a lot of guys like it because it kind of just melts in very light and we'll keep you protected from the sun here.
Katie Perry (25:52):
We'll take that offline. Yeah. I want to go back to something you mentioned because we love talking about data on this show and interesting use cases for it. You talked about looking at e-commerce site data to inform your shelf strategy at the store. So I'm wondering, you guys must see so much data across so many different channels and I think this is a common problem with businesses now. How do you actually connect and contextualize all that data together and it's got to be structured in different ways. So what does that look like within elf? Do you have a whole data team running that? How is data part of the DNA of the company?
Tarang Amin (26:30):
No, it's essential to the DNA of the company. And I would say we certainly have a data team part of both our digital team as well as our insights teams. And they're constantly going through from everything from creating the data lake to how we mine that to now starting to use AI to also help uncover some of those insights. But one of the best tools we have is one of the simplest we have as part of our overall program, we have a loyalty program called Beauty Squad and we have almost 5 million Beauty squad members. And not only are they great fans of the brand, they buy way more than anyone else on our website. They certainly purchase more frequently. They're the big driver of el cosmetics.com. But the other great thing about Beauty Squad is the rich source of first party data, data that we can use to better target in our marketing activities, but also data and insights we can use to the business.
(27:26)
So the top tier of Beauty Squad, they don't only earn points by buying product, they earn points by their level of engagement in the brand. So giving product ideas, responding to different quizzes we have being able to really drive, and again, very community oriented in our spirit. So we have plenty of data like any other company, we do a good job mining that data, connecting it, looking at within kind of our retail data versus our e-commerce data. But the most important thing is I'd say that ability of being really close to our community and understanding them at a level that is so deep and that really drives a lot of the main success that we have.
Katie Perry (28:06):
Love that. Do you have any sense of how many loyalty members own ELF Stock as I feel like that would be such an interesting analysis.
Tarang Amin (28:17):
I don't know that number, but what I would tell you is there's quite a bit of love and affinity amongst our community for Elf. And we hear all the time, I went and bought some stock and they'll let us know how they were doing with it and obviously the stocks performed well. But I would say I don't actually have the number of,
Katie Perry (28:37):
It's got to be a lot of crossover. That's awesome. So
Austin Hankwitz (28:40):
You guys are one of four public companies with a board that has at least two thirds women and one third minorities represented. Do you see this as a competitive advantage? And I think you said yes before talking about the communities you guys are selling to and it's definitely represented within the company, but just double click on what the evolution of the board has looked like since you began working at Elf back in 2014.
Tarang Amin (29:05):
Yeah, sure. When I joined Elf, it was with a private equity partner, TPG growth, terrific private equity fund. They backed my last company, we bought Elf together. Between TPG, my family and the founders rolled into money. And when we first started it was a typical private equity board, mainly men, mainly white and usually it's the sponsors and people. The sponsors. When we decided to take the company public, I declared that I wanted to make sure that our board reflected the community we also served. Now, I couldn't do that necessarily in age because of sometimes the qualifications of how much experience they have, but I certainly could do it in terms of wanting at that time, which is quite rare, majority women on the board and a focus on diversity too, given the community we serve. And I'm very proud that we've been able over the years to be able to have two thirds women over a third diverse representation. But it's an incredible board and the value that the board has provided us, oh my god, I can't tell you how many different ways, but the ability of being able to stay culturally relevant, understand the audiences we're doing, understand the approaches that we're taking. We have a world-class board and it's allowed that. And so I'd say definitely along with our team has been a key advantage. And you can definitely see it in the results.
Austin Hankwitz (30:23):
You can definitely see it in the results. Congratulations.
Katie Perry (30:26):
Yeah, and there's so many times I feel like a company makes a decision and my brain goes to obviously X, Y, Z person was not in the room because they would've caught it. So I think that's really interesting to hear. And I know you guys actually recently had a unique campaign that was consumer facing, but it was about your corporate sort of diversity initiatives, the so many Dick's campaign. Can you talk us through what that was, where that idea came from and why you felt it important to reflect that story back to consumers when it wasn't necessarily about your products?
Tarang Amin (31:04):
Sure. It goes back to our purpose. If you look at our purpose that we stand with every eye, lip, face and paw, we have three pillars encouraging self-expression, empowering others and embodying our ethics. So our board diversity definitely relates to our purpose. And while it's a great stat that we're one of only four public companies out of 4,200 that have those kind of stats, the fact is we don't want to be one of only four. We want there to be more companies and we feel it's our duty to promote greater diversity on boards. And so the particular campaign, the of it actually started first by working with Billie Jean King, obviously a real champion of equality and just serving up facts of just how non-diverse or homogenous a lot of corporate boards were in the us, so how many women, minorities, what was represented. We then took that a step further and did a campaign.
(31:56)
And as you mentioned, the headline of the campaign was so many dicks, so few of everyone else. And the sub copy is they're almost 600 Richards Ricks or Dick's on America's corporate boards, probably about twice the number of Hispanic women, almost the same number as black women as other minority overall representation. And our whole point was there's nothing wrong with being a Richard Rick or Dick, let's just make room for some others. And so what I loved about the campaign is it very much speaks to our purpose and our values as a good corporate citizen of encouraging greater diversity. But the other thing that I really loved about it was not only you get, and by the way, a lot of the, we placed right on Wall Street right across and on the New York Stock Exchange at the Oculus, you couldn't miss it if you're in the financial community.
(32:48)
We got tremendous positive response from the financial community of like, yep, this makes, it's an incredible initiative encouraging others. We partnered with the National Association of Corporate Directors and sponsoring 20 women and diverse members to go through their accelerate program to get them ready for board service. But probably what was most gratifying for me was we also put it on Instagram and we had over 98% extremely positive sentiment from our community. And the reason why that's important is sometimes people separate out consumers or their community and investors. And for us, we see this tremendous overlap in values and what we find particularly with our young engaged community is it's not good enough just to have products that are high quality at great prices. They also want to know what are the values of the company that stands behind those products. And so when we put out the so many digs campaign, even amongst our community from a consumer facing standpoint, like I said, over 98% positive summit and the comments we get is this is why a buy elf, this elf is trying to make a positive difference in the world. It speaks so authentically to who we are and from what they see, both in terms of who we represent and the things that we do. And so that's the part I loved about it and we're definitely committed to this for the long term in terms of really living our values and that goes hand in hand with commerce as well.
Austin Hankwitz (34:15):
Amazing. What a cool campaign. I mean I saw that on the website and I was like, this is awesome. I also saw though that you have a board member named Rick. So what did he think about the campaign,
Tarang Amin (34:26):
Rick, and by the way, Rick is a phenomenal board member. So like I said, there's nothing wrong with being a Rick Richer Dick. Rick has been an absolutely phenomenal board member, probably one of the longest standing board members we have in almost 10 years. Rick loved the campaign. He himself said, yes, there's a need for greater diversity on boards. And I tell people all the time, I wish I could tell you that this was hard. It wasn't. All it took was intentionality and putting that intentionality in action. And that's all we're trying to encourage other companies to do. At least make it part of your consideration set and you'll be amazed by what you're able to accomplish.
Austin Hankwitz (35:04):
Round of applause for you guys. You all are seriously between all of these initiatives and your digital marketing strategies and how you are being proactive in store versus your e-commerce insights and data and the innovation you're doing. I mean, you all are a just top tier company that I wish more people. I hope a lot of people get awesome insights from this interview because I've of course heard of Elf Beauty. I've traded your stock here and there, but I had no idea all of this was going on behind the scenes. So I really hope the listeners of this episode learn something in this episode. Now, before we wrap things up, I am pretty positive you're an immigrant, right? I come from an immigrant family. So what has been maybe some of your largest entrepreneurial lessons in teachings throughout your life as someone who has gone from new to Check me out. I'm the CEO of an 11 billion company.
Tarang Amin (36:02):
Well, I mean I get a lot out of my roots. Both my parents were born and raised in India of Indian ethnicity. I was actually born in East Africa. My dad used to work in Kenya, spent part of my childhood in Kenya in Uganda. We immigrated to the US when I was young, and while most of my career has been in these large consumer companies, I was with p and g for a number of years, Clorox for a number of years. I tell people a lot of what I learned about business was between the ages of 14 in my mid twenties because as many immigrants do, we rose as entrepreneurs. So when I was actually 14 years old, we sold our house, we took every penny we had and we bought our first motel on Route one in Alexander, Virginia. Moved right into the manager's apartment and our business model as a family is we'd find these distressed properties, we'd fix 'em up, we're good operators, and we kept kind of building out that business.
(36:49)
The reason why I always tell the motel stories is as great as some of the corporate backgrounds or environments I was in. Everything I know about cashflow, economic profit, how you treat people, really came from those early days building up our family business with my dad. And so I've continued to this day, this is like many, many years later, to take the lessons we learned from a much smaller business and how you motivate people, how do you get people working together in a high performance way and being able to apply that on bigger, much larger businesses to scale. I still go back all the way to when I was 14.
Austin Hankwitz (37:26):
Wow, what an inspiring story. Yeah,
Katie Perry (37:28):
That's awesome. And how cool that the little things you picked up as a young person are popping back in and out of your life after that. Really awesome Teang. It was so great having you here. Thank you so much for taking time. It sounds like you guys are doing a million things at once, so we really appreciate you being here and we hope to have you back soon.
Tarang Amin (37:49):
Well, thank you so much for having me. Really enjoyed it.
Austin Hankwitz (37:52):
Dang, what an awesome interview with Teang. I mean, this company is just firing on all cylinders.
Katie Perry (37:58):
Yeah, I mean, that was an amazing interview. We covered a lot of ground. Did you have any specific points that stood out to you, Austin?
Austin Hankwitz (38:06):
I think the big thing was the sort of proactive mentality of this company, not just with trying to get in front of and meet their audiences where they are. If that's Twitch, if that's TikTok, if that's Roblox, but also from an in-store perspective, right? Terrain was talking about how through reviews and sales on their e-commerce, they know what products are selling well, what products are not selling well, and they don't wait for these targets to say, Hey guys, this isn't selling. They just go in and just switch stuff up.
Katie Perry (38:38):
Yeah, velocity is definitely a word that comes to mind when I think of them. I loved hearing about all of the marketing campaigns. They have an amazing team, but also about the insights they're getting from their community and talking about the loyalty program in which members can actually earn points for giving feedback on the products themselves in addition to buying the product. I think that's so interesting and very few companies are doing that. The other thing I really loved is really, he made a business case for diversity in a way that I think a lot of people who believe in that as a value at companies are often trying to do, he's talking about 60% of their workforce being Gen Z. He's talking about their board, their leadership being people of color, being women, being reflective of all the people they're serving. And it really does come across in the product, especially when you have products that need to meet the needs of so many different people.
Austin Hankwitz (39:32):
100%. I couldn't agree more, and I think back to what you were just talking about regarding sort of these loyalty points and the questions and things of that nature. Their community said, Hey, we want this. I think this was a bronzer, I think that's what it's called. Oh,
Katie Perry (39:45):
Bronzing drops.
Austin Hankwitz (39:47):
Bronzing drops make us some Bronzing drops. And they said, okay, say less. And they said, boom, $12. Here you go. Have you ever heard of that? A company doing that? That is unreal to me.
Katie Perry (39:57):
Yeah, that was awesome. As someone who's paid $40 for Bronzing Drops, somebody needed to end it. So glad Elf was able to do it.
Austin Hankwitz (40:05):
Elf stepped up to the plate and they hit it out of the park. Everyone, thank you so much for joining us on this week's episode of After Earnings. Don't forget to like, subscribe, tell your friends that wear Elf Cosmetics about the episode. Follow us at after earnings on social media and we'll see you next time.
