Ipsy Essay

657 Words2 Pages

Introduction: Ipsy is an online makeup subscription delivery service that was founded in 2011 by YouTube beauty vlogger Michelle Phan, Marcelo Camberos, and Jennifer Jaconetti Goldfarb. Ipsy charges users $10 per month for a “Glam Bag”. Ipsy’s “Glam Bags” are made of fabric and specially designed every month so that they can be kept and reused. The contents of the bag are also premium. Ipsy works with beauty brands to make sure that customers get a selection of full sized products among the samples. The selection of the products is based on the consumers data. When they sign up for a “Glam Bag”, they are asked to take a quiz. Most people who take the quiz connect their Facebook accounts and the combination of products are from the hundreds …show more content…

But then, beauty bloggers showed up and changed the game. Instead of looking to brands to set the agenda about what products they should buy, consumers began looking to their peers who in turn began creating videos and tutorials on YouTube. This created a crisis of sorts in the beauty industry but Ipsy benefited from this. Ipsy early growth success is thanks to Michelle Phan social influence and other associated vloggers. When it launched in 2012, Michelle Phan was the face of the brand. Today, Ipsy has made online influencers the centerpiece of its business model. The company works with over 500 YouTubers and Instagrammers in the beauty realm and some of whom are paid to discuss participating brands on their social media …show more content…

As of September 2017, Ipsy has more than 3 million subscribers (TechCrunch, 2017). Ipsy also raised $100 million in Series B funding from the high-profile firms TPG Growth and Sherpa Capital valuing the company at a reported $800 million last year (FastCompany, 2016). As Ipsy looks to grow, it’s going to lean heavily on that word of mouth and keep it cost of customer acquisition low (TechCrunch, 2017). With millions of users paying $10 a month, it has leeway to heavily invest in this new emerging business but it also has to be careful not to fall into trap of emerging consumer brands that end up aggressively spending to expand into new markets (TechCrunch, 2017). Ipsy is investing heavily into building up its already 10,000 person-strong network of amateur beauty vloggers. These content creators aren’t bound by contract. They just have to make a few videos a month that are Ipsy related and the rest is up to them. Together with Ipsy’s in-house stylist, they generate 300 million social media impressions a month for the company (FastCompany, 2016). Ipsy gets exposure and more views of its ad-embedded YouTube content and in exchange it gives vloggers access to the Open Studio, mentoring, networking, and publicity opportunities, and special tools Ipsy has to offer (FastCompany,

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