When you think of “subscription services”, chances are that big brands like Hello Fresh, Netflix or Fitness First spring to mind.
The set-and-forget business model is a smart one for many reasons. By guaranteeing repeat purchases brands can have greater certainty over their projected income and reduce overheads by more efficiently buying the goods needed to operate. The customer wins too, as brands can lower the cost-per-use and pass on those savings, while still making a profit.
The skincare industry, while still booming and infinitely innovating (even post-lockdown), has by and large followed traditional retail models of doing business – selling directly to the consumer via online or brick-and-mortar spaces. But change is afoot locally, with a number of Australian skincare brands harnessing the unique benefits that a subscription model can bring to not only their own bottom line, but to the health of their customers’ skin, too.
While co-hosting their beauty-focused podcast Cosmechix, friends Katelin Gregg and Ella James realised there was an issue with how people viewed and accessed facial treatments in Australia.
They tell T, “The audience frequently expressed that traditional facials were expensive, time-consuming, and overwhelmingly categorised them as a luxury – rather than an essential aspect of ongoing skin health. This motivated us to create a [business] model that encourages regular facials.”
The pair co-founded Fayshell, a subscription-based membership service for personalised facials, in December of 2022, opening an Instagram-friendly skin clinic in Sydney’s Bondi Junction. Similar to a gym membership, clients pay a set monthly fee and receive one bespoke facial per month – regardless of what the treatment includes (the pair calculate that this way of paying could save $50 to $400+ per facial, and that’s before considering the value that unlimited LED treatments brings).
Gregg and James say that the savings for clients are obvious, but are not the sole reason for their subscription model. “The primary focus of our pricing structure is to offer personalised and effective skincare solutions, rather than solely emphasising the monetary savings.”
In today’s busy society beauty appointments often get overlooked, but with our membership clients are reminded to prioritise their skin.”
It seems that their clients see the value, either way. “We’ve seen great traction, and the month-on-month percentage of memberships is growing: Forty per cent of Fayshell clients have already signed up for membership. And we’re looking to open our second clinic in September this year.”
Like Gregg and James, Geelong-based Saint Louve skincare founder Elly Seymour listened to her customers and what she heard was a cry for help to be more consistent with their skincare routines.
“We listened and watched our customers’ behaviours; a lot of repeat orders were coming in with express shipping, or even same day shipping in Melbourne metro. This told us people wanted their orders, and wanted them fast. We got so many messages from our customers expressing how much they were missing their serum whilst waiting for their next to arrive.”
Seymour responded with Louve Loop, launching a subscription service for their serums in May of this year, rewarding customers with a 15 per cent discount for the products they repeat purchase.
For Seymour, consistency is the key to customers seeing results – meaning the subscription model helps to prove her skincare line’s efficacy – as well as bolstering her business. “We know that with certain skincare products, it can take time to see benefits, retinol can take up to 12-24 weeks before benefits are seen. Using cosmeceutical skincare is not a quick fix. By remaining consistent with your routine, you reap the rewards.”
This is brand-bolstering approach is one that GP and cosmetic doctor Dr Prasanthi Purusothaman shares, but adds that there are also some business benefits for starting a subscription skincare line – as she herself is about to do with L’Orient (pencilled to launch in late 2023, or early 2024).
“A subscription model is a symbiotic relationship between the business and the consumer that fosters a long-term relationship. The consumer gets convenience, ease and discounts on this model of purchase. The retailer gets consistency of sales – which helps forecast stock and raw materials better, as well as importantly fostering community and customer retention.”
Purusothaman describes her yet-to-be launched prescription and over-the-counter skin care line as “grounded in a holistic Eastern point of view that rejects ‘correction’ in favour of balance,” and says it “bridges the gap between advanced cosmeceuticals and traditional Ayurvedic ingredients and principles.” Purusothaman looked overseas to other subscription-model health and wellness brands for inspiration, citing Moon Juice, Ritual, Kin and Heights as successful examples – all which rely on a habitualised usage of the product to see results, and who also focus on the community of customers to support that repeat repurchase.
This modelling works particularly well when applied to skincare aficionados, but especially so if you need to see your doctor or dermatologist for prescription-only products.
“Having a product delivered straight to your door, and pre-empting when you might be running low … allows patients and consumers to be consistent with their skincare to reap the best benefits. For low-risk skin conditions, a subscription-based prescription skincare model eliminates lengthy wait times at the doctors, lining up at a chemist and is improving accessibility to quality formulations.”
Describing the vast majority of skincare options in the beauty market as a “very big, black hole”, Purusothaman reiterates that ultimately, building a superior connection with their customers is what sets subscription skincare apart from the pack.
And if a brand can truly deliver on their promises of better skin, it’s no surprise that their customers will come back again, and again, and again.