Birchbox CEO Says Walgreens Partnership Will Help Court 'Non-Obsessed' Shoppers

December 7, 2018

By Michael Teich

Birchbox wants a bigger piece of the cosmetics market, but courting obsessive shoppers is not part of its plan, according to CEO and co-founder Katia Beauchamp.

"We are focused on that non-obsessed consumer, that casual consumer," she said in an interview with Cheddar Friday.

The Birchbox subscription service works like this: After subscribers complete an online profile about beauty preferences, Birchbox ships a box of five sample products, giving them a chance to try a mix of well-known and niche brands at a price point of $10 per month.

Although it may be most-known for its e-commerce savvy, Birchbox is now breaking into brick-and-mortar through a partnership with Walgreens. Beauchamp said Walgreens helps Birchbox accomplish its goal of reaching a large pool of consumers who may not necessarily be seeking out beauty products. Curated selections of Birchbox products will be available at 11 Walgreens across major metropolitan markets.

The competitive beauty industry, which is expected to exceed $390 billion in market value by 2023, is dominated by behemoths like ULTA Beauty ($ULTA) and Procter and Gamble ($PG).

But Birchbox thinks it can distinguish its brand by courting the casual consumer.

"We identified that there was a really big opportunity with the average beauty consumer," Beauchamp said.

"The Walgreens consumer is America, is everybody," she said. "To own the customer, you can't be a single channel. You can't just be online, you can't just be offline."

Subscription boxes have been a popular business model adopted by a number of industries ー including prepared meals, nutritional supplements, and shaving kits. But that model was somewhat tarnished after meal-kit company Blue Apron's IPO flop raised a red flag for investors. Beauchamp, however, remains unfazed by Blue Apron's epic bust ー and she's confident Birchbox will avoid the same fate.

"I think we're all really focused on differentiation. We just talk a lot about understanding who this customer is, and how do you convey to this customer care and love," she said. "We really are passionate about doing something that has never been done in a multi-billion dollar industry."

For full interview click here.