Q&A with Happy Skin CEO Jacqe Yuengtian Gutierrez on Creating a Filipino Cosmetics Brand

Happy Skin is a cosmetics brand that was recently awarded by Ayala Malls as the Most Promising Retailer for 2015 and by Watsons as the Most Promising New Cosmetic Brand of the Year for 2015. A former marketing executive of Unilever, its CEO Jacqe Gutierrez shares her insights about entering a highly competitive cosmetics industry in the Philippines.

Q1: There are already so many brands of cosmetics in stores, online and via direct sales. What unmet needs are you trying to satisfy with Happy Skin?

A: Yes, there has been a huge influx of cosmetic brands in recent years and yet the Philippines remains to be one of the lowest penetrated countries in the region. Less than a quarter of our population use any cosmetic product vs. 43% in China or 85% in Korea. This huge disparity means there is still an unmet need especially for Filipino consumers.

Based on past FGDs, we’ve discovered that Filipinas are scared of using any makeup product in fear that it might ruin their skin. This is the number one barrier in trying makeup! In fact, more than 50% of Filipinas who use makeup only use a lipstick and baby powder on their face.

What we’re trying to do with Happy Skin is to recruit virgin makeup users by addressing their biggest concern on cosmetics. Happy Skin is positioned to be a skin-caring makeup, it’s a fusion of skincare and makeup where you don’t have to compromise. We satisfy their skincare needs and emphasize our skin-loving ingredients so that their concerns are addressed and they can start enjoying the power of makeup. At the time of our launch, no brand has actively positioned itself as a skincare makeup and that I think is what differentiated Happy Skin in the sea of cosmetic brands.

Q2: What are some of your biggest challenges since you have started about three years ago?

A: One of the biggest challenges for me is the lack of data. As a marketer, I’m used to making decisions with a wealth of information and solid research. I was always armed with a green concept product test and a very clear size of the prize with every launch. As an entrepreneur, I had very little formal research to back up any of my proposed marketing strategies. I had to rely mostly on my observations and intuition to sharply define Happy Skin’s launch mix. I had to get out of my comfort zone and trust my gut that I truly understood what the consumers needed for this category. So now, I encourage my team to regularly do store visits and talk to consumers. My pastime is to read the comments section of our social media accounts, as it’s the richest source of insights. The way I do marketing now is more grassroots, ears to the ground and much more connected to my consumers than I ever did before.

Q3: What is your distribution intent? I understand you started with Beauty Bar, Rustan’s and clothing store Plains and Prints before making Happy Skin available in selected stores of SM and Watsons. You also have your own boutique at Glorietta 3.

A: We initially started by partnering with the SSI group (Rustan’s and Beauty Bar) as they are one of the respected beauty retailers in the country. We had to ensure that we launched in the right channel in order to establish our credibility as a legitimate cosmetic brand.

We also partnered with Plains and Prints, a leading fashion retail brand which caters to the same audience as Happy Skin. Fashion and Beauty have often crossed paths and some of the biggest makeup brands are actually big names in fashion as well. In this day and age, nothing is linear anymore, it pays to be one step ahead and being in Plains and Prints has enabled Happy Skin to grow faster & create more brand awareness in a not so conventional manner.

Currently, the goal is to further strengthen our foothold and widen our availability so we are working with the no. 1 retailer SM (SM Beauty & Watson’s) to have presence in their top branches nationwide. We also plan to open more boutiques in the coming months to be able to give the full customer experience to more Happy Skin fans.

Q4: You were promoting some beauty books (worth over P1000) in-store. How is that connected with the selling strategy of Happy Skin products?

A: The intent is to increase consumer basket size. As a startup, our resources are very limited in terms of creating awareness for the brand. Therefore each customer we recruit is very important and we had to ensure that we convince her to buy more of our products. I first tested this strategy during our first summer collection back in 2014. I realized that our lippies are bestsellers with great online product reviews but women only bought 1 or 2 lippies at most when they make a purchase. So I had to give them an incentive to buy the entire collection. We created the first box collection that summer and sold 3 lippies in 1 box. We marketed it in such a way that when you buy the set, you not only get 3 lippies but 6 different lippie shades (since you can layer the different lippies and get a totally new shade). So purchasing a 1k+ box set isn’t really an extravagance but a value for money proposition. Of course when you do the math they get a little bit of discount if they buy the box of 3 vs. buying it individually. Our box sets now are a staple with every collection.

Q5: You worked as Marketing Manager and Regional Head of skin care of Unilever before launching Happy Skin. What did you learn from your job that you are able to apply in Happy Skin?

A: Being single-minded is the most important discipline I learned in Unilever. I think it’s a common misconception to offer multiple benefits in the hopes that it will attract a bigger market but being focused as a brand is the only way you can cut through the marketing clutter. Being single-minded in what you want to communicate is the best way for consumers to hear your message. In every product that we do, there’s always a “Happy Skin says” thought bubble where we highlight the skin-caring ingredient of the product. That’s our key proposition; we are the makeup that cares for your skin. This is communicated in every single touch point of Happy Skin. Our consumers’ raves about how moisturizing our lippies are or how our Zit Zapper cream is the answered prayer for their acne-prone/ sensitive skin. We are single minded in communicating our differentiator.

Another tool that helped me refine Happy Skin’s marketing strategy is using the 6Ps. It was a discipline that was ingrained in me in my years as a marketer. A common misconception of marketer’s job is that we only create promotions & commercials. But promotion is just one P and it’s actually our job to create the perfect mix to offer to our consumers. For me, the 6Ps is a good checklist to ensure that I have the basics covered and that I have a well thought out mix. Creating a 360 campaign is also something I teach my team to do for every launch.

Lastly, my decade working in personal care allowed me to have a deeper understanding of Filipinas and their needs. The countless home visits, FGDs and researches are vital knowledge that helps me craft campaigns and ensure that all the products we create satisfy a latent consumer need.

Q6: Happy Skin is being introduced as a local Filipino cosmetic brand. What is your vision for the next few years for Happy Skin?

A: The rise of the millennials paved the way for social media and social media paved the way for Happy Skin. We have entered the market at the right time, as social media became the great equalizer between the big brands and the startups. It’s also a great time as Filipinos are more receptive to homegrown brands, there’s a stronger sense of pride in patronizing Pinoy brands. Hopefully, Happy Skin remains relevant to our market and is able to churn out exciting product innovations. Product innovation is essential to the cosmetics category so that’s something that we will constantly focus on. It’s important for cosmetic brands to bring excitement to consumers and to give them a satisfying user experience.

The goal of Happy Skin is to be one of the most respected cosmetic brands in the world. Now, Filipinos are always surprised when they realize that Happy Skin is a local brand. We want to transform that mentality and make them believe that Filipinos can create global brands, that we are capable of creating mixes that are globally competitive.

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