Every year, Beauty Packaging asks its online community to vote for the company they think deserves the title of Beauty Company of the Year: Excellence in Packaging. This year, two brands received such a slew of votes that we decided, for the first time, to name a winner in a new Indie category as well as Clarins, in our traditional Global category (please see page 20 in this issue).

So congratulations to Stowaway Cosmetics—Indie Beauty Company of the Year: Excellence in Packaging, 2015.

Stowaway Cosmetics could be the “poster child” for representing today’s indie beauty spirit. Two friends—the founders of the brand—recognized a white space in the industry based on their own cosmetics habits, and dove into development. Things moved ahead quickly because they could act nimbly and make rapid decisions—and they were laser-focused on what they wanted. The brand launched a year ago, in February 2015—just 12 months after they hatched their idea—and has achieved widespread acceptance. Part of Stowaway’s success lies in its ability to capitalize on one of the latest industry trends—selling directly to consumers from their website.

In July, the brand earned the title of “Cosmetic Package Innovator of the Year” at the 2015 ICMAD awards held during Cosmoprof North America. Stowaway created their line of luxury, lightweight and portable products in collaboration with HCT Group.

Stowaway was started over breakfast with two girlfriends, Chelsa Crowley and Julie Fredrickson. Julie calls herself “the makeup civilian” and, for advice, relies on Chelsa, who has a decade of experience in the cosmetics industry. Julie asked Chelsa: “Why is it so hard to find makeup I love in sizes I can carry and actually finish?” When Chelsa, who always had the answers for any makeup or beauty question, didn’t have an answer for Julie, the pair knew they had hit on something special.

Fredrickson says: “Stowaway started because we both dealt with this problem of cumbersome heavy, impossible-to-finish makeup in different ways: either carrying an entire makeup bag filled with heavy glass jars or subscribing to any box-of-the-month club and buying gift-with-purchase packages just to receive the gift, in order to collect smaller products that fit into our lives. We knew the smaller sized products existed and were frustrated that we weren’t able to find them on a consistent basis for purchase.”

The friends felt like women’s habits had changed with the times, but had left their cosmetics in the past—with a much-needed update to fit today’s on-the-go lifestyle.

Crowley explains: “We were unable to find the makeup we loved in the sizes that made sense for our lifestyles. It’s no longer the 1950s—women are not sitting in the boudoir, they’re on the move and so is their makeup. We wanted to create a brand that fit into modern women’s lives, which also allowed us to create better, safer products that women had the chance to finish before the products expired.”

From the office, to the gym, to drinks to dinner, Crowley says beauty consumers want flexibility and portability built into their cosmetics, without sacrificing quality for size.

The founders’ years of experience working in both beauty and e-commerce provided them with the necessary confidence that helped speed them on their way. “We knew we were the team to tackle this problem because we combine both the direct-to-customer retail and beauty experience that is needed to bring our vision to life. It takes a unique combination of talents to take on the challenges of entering the beauty business,” says Crowley.

Right-Sized Makeup

Stowaway is described as “right-sized makeup.” Crowley specifies: “It’s makeup you love in sizes you can carry and actually finish before it expires.”

The line is slim and compact, congruent with its packaging. The idea is not to have huge amounts of products but, instead, a curated collection of makeup items that women can rely on, take anywhere, and use entirely while the formulations remain fresh.
  
Products currently available include six essentials—BB cream, concealer, eyeliner, rouge, lipstick and mascara—ranging in price from $10-$22. Radiant Complexion BB Cream is available in Fair, Light, Medium and Tan; Creaseless Concealer in Fair, Light, Medium and Tan; Cheek & Lip Pot Rouge in Burnt Rose, Cantaloupe and Peony; Effortless Eyeliner in Jet and Spice; Creme Lipstick in Champagne, Fig, Peony, Scarlet, Cranberry, Raspberry and Muted Plum; and Extreme Lash Mascara and Defined Lash Mascara.

Recently, I caught up with Crowley and Fredrickson to learn more about their line of highly curated products in minimalist containers—and found renewed proof that good things do indeed come in small packages.

JM: What factors do you think influenced readers to select Stowaway as Beauty Company of the Year: Excellence in Packaging for 2015?

CC: Our clear differentiation in the market as a company committed to right-sizing made us stand out. We also didn’t cut a single corner, as we don’t have the same margin compression issues as wholesaling brands that need to pinch every penny in order to meet retailer’s pricing demands. That allowed us to invest in little details like soft touch and mirrors, which make all the difference. Industry veterans told us it couldn’t be done when we first set out, but we knew that if we provided packaging and product that genuinely fit women’s needs it would succeed. And I think the readers of Beauty Packaging saw that we had done just that.

JM: Who is your target customer?

CC: Our customer is early 30’s to mid-40’s.  We really speak to busy, modern professional women, mothers. We call this demographic ‘the woman with the most amount of responsibility and the least amount of help.’

JM: How did your experience play into creating the brand? 

JF: Delivering consumers incredible value by offering direct to consumer beauty requires capital and quick scaling, and there’s no two better people to make that happen than a serial entrepreneur and beauty expert.

JM: Can you speak a little about the ‘white space’ you identified?

JF: We saw a tremendous business opportunity. Big conglomerates dominate the industry and the economics don’t make it possible for them to serve this clear need. It costs the same to make a small product as a big one, but the margin on a big product is large as they can mark it up further, and as all cosmetics sell at wholesale prices and are locked into retail partnerships, there is no value to them to produce the kind of portable products that women want to use today. My direct to consumer e-commerce background gave us a tremendous strategic advantage in building this company from scratch.

JM: Can you elaborate on your business model?

CC: We see ourselves as a technology startup just as much as a beauty brand. There are very few multi-billion dollar industries that have yet to be disrupted by technology and changing lifestyles.  Seventy percent of the total market share for the beauty industry is consolidated into the top ten conglomerates. In the U.S. alone, the beauty industry is a $60 billion industry that hasn’t changed its production and distribution model in years. Our technology-first focus differentiates our business model and allows us to thrive where wholesale-driven brands cannot.

JM: How did the idea of small sizes mesh with the direct-to-consumer approach?

CC: The idea required a change in thinking and a new kind of business model in direct-to-consumer to succeed. Existing brands, had they been willing to invest in more direct retailing and experiences in which they can sell these products at the same margin as their full-size products, could have invested in this category. But their unwillingness or inability to innovate provided us with this opportunity. We saw an underserved market and an entrenched business model that can be improved upon. By selling directly to our consumer, we can offer quality at a size that women want, which saves them money and significantly reduces waste. Most women don’t finish their cosmetics before they expire, throwing money and products down the drain. Stowaway is changing that. Our products are designed and sized to be used before their expiration date. We are also seeing an increasing squeeze on ‘purse real-estate’ being taken up by phones, iPads and laptops.

JM: Is there a particular direction in which the brand is going? 

CC: We never plan to be a SKU-intensive company. We want to continue to make women’s lives easier, and part of that is not bogging them down with choice. We do the research ahead of time and find the best ‘red’ and the best formulations so when our customer comes to us, she knows she’ll find what she needs.

JM: Are Stowaway products sold exclusively on your site? 

CC: Yes, we sell direct to consumer from our website, www.StowawayCosmetics.com, which allows us to keep our prices down for our customers. We think that everyone should be able to buy premium formulations—and only buy what they will end up using before the product goes bad.

JM: What’s special about the ingredients?

CC: The safety of the ingredients is also critical to the brand. Stowaway is EU compliant, which means we use ingredients that are approved in not only the U.S., but also the EU. The U.S. only bans the use of 11 ingredients, while the EU bans over 1,300.

JM: How did your direct-to-consumer approach influence the packaging?

CC: We do not have to hew to traditional conventions of being appealing on shelf real estate because our retailing strategy is direct. That allowed us to create packaging that spoke to its ultimate use case, which is in a woman’s hand and in her purse and not its placement in a store or on a shelf. 

JM: Why did you choose the gray-and-white color palette?

CC: When you go into a Sephora or department store, everything is black and shiny. There are certain norms that have taken hold in the beauty industry as to what constitutes luxury and quality. And they are starting to feel outdated. But isn’t it funny that no one has given any thought to how hard it is to find a black compact in a dark purse? Stowaway’s identity is meant to reflect our commitment to clean, modern and minimalist values. In some sense, it was a repudiation of a lot of the norms of the cosmetics industry assumptions of how ‘things should be done.’ Real luxury has changed as our lives have become complicated. Now, time is the one luxury that no one can buy. And we wanted to reflect that simplicity, ease and cleanliness are ways to clear your mind, relieve anxiety and add time back into your own life. That guides our brand, and at the center of our brand is our packaging.

JM: What has been most rewarding about launching this line?

CC: Speaking to our happy customers. Every email, Tweet and comment from women telling us that we’ve helped make their routines easier, their lives simpler and eased their minds, keeps us fueled.

JM: What has been most surprising?

CC: We had imagined our products being those that fit into women’s lives when they’re in motion (at work, at the gym, when traveling), but increasingly we’ve found that women are replacing their entire cosmetics routines with Stowaway. To have the honor of being a woman’s primary makeup choice in such a short time has been both surprising and tremendously rewarding. BP

About the founders

Julie Fredrickson, co-founder and CEO, Stowaway Cosmetics, has a background in e-commerce and digital marketing. She has worked with clients including Ann Taylor, Gap, Equinox, Nike and Coach. Fredrickson’s first company, Coutorture Media, was a pioneer in the fashion blogging and affiliate marketing space.

Chelsa Crowley, co-founder and chief creative officer of Stowaway Cosmetics, began her career as a makeup artist before working on product education for Clinique Cosmetics. She later worked in the fashion industry alongside Francisco Costa at Calvin Klein Collection, before returning to beauty, as part of the Bobbi Brown Cosmetics team.