Breakthru Beauty’s Allison Slater Ray And Lisa Motzko Hamilton On Why Chasing Trends And Virality Can Hurt Brands

Combined, Allison Slater Ray and Lisa Motzko Hamilton, co-founders of new consultancy Breakthru Beauty, have been in the beauty and retail industries for more than 50 years. They met through IT Cosmetics when Slater Ray was SVP of marketing at the brand and Motzko Hamilton was at Ulta Beauty, where she was formerly senior buyer, DMM and VP of prestige cosmetics, and helped orchestrate its in-store business. Slater Ray has also held positions at Sephora, Calvin Klein Cosmetics and Memebox, and Motzko Hamilton has had stints at Briogeo and JLo Beauty.

Now, they’re leveraging their collective experience to guide beauty brands at various stages—from emerging to established—on retail readiness, financial management, marketing strategies and more. “Allison and I both separately had this dream of being entrepreneurs,” says Motzko Hamilton. “We both have this huge passion for working with brands, having fun and rolling up our sleeves and being successful. Knowing the retail side, ultimately our goal is to see success for both sides.”

Beauty Independent chatted with Slater Ray and Motzko Hamilton to understand how IT Cosmetics became a big hit snapped by L’Oréal, the keys to convincing retail buyers to take on a beauty brand today, the perils of pursuing social media virality, and major missteps they’ve seen brands make time and time again.

Why did you come together to start Breakthru Beauty now?

Motzko Hamilton: The landscape has changed so much. Hiring this big C-suite group executive team isn’t necessary anymore. The majority of brands killing it now started out small, and they can’t afford an executive team to tell them how to be successful. I want to work with the smaller guys, but the smaller guys can’t justify my payroll right away and have the full C-suite.

How did you bolster IT Cosmetics’ success after arriving there in 2015?

Slater Ray: The brand was doing well, but, from a marketing standpoint, there was so much opportunity. I knew that they wanted to sell to L’Oréal, and I knew what L’Oréal’s feedback was. Because the brand’s heritage was QVC, there was this perception of it as mass.

The first thing I did was take a giant step back and look at the brand positioning. If you asked someone what the brand stood for, they couldn’t answer it in a quick short sentence. So, we wrote the positioning statement for the brand and a mission and vision for the brand and its values. That became a rallying cry for why the brand was different. It united all the marketing, and it made employees realize they were working for something bigger. It was about giving women confidence.

The brand had been all over the place. There were different logos on different packaging. Some people called it Innovation Technologies by Jamie Kern Lima, some places it was IT cosmetics. We streamlined the packaging, made it all look the same, but didn’t take away what was key to the brand.

Because we’d done the brand positioning work, we knew what was important to the brand. It had to be clinical, but approachable. Two very different things, but we were able to achieve that in our new packaging. Now, everyone does before-and-afters, but we were one of the first to do them. We used language like “real” and “real results.” We had a more prestige look, but kept it approachable.

We wanted to expand international distribution and into Sephora. It’s very challenging to expand it into Sephora if you’ve been in Ulta. After getting rejected many times, we took a unique approach and went in with the skincare exclusive proposition and that’s how we launched in Sephora.

In the U.K., we decided to go into Selfridges on the main floor. We were next to the Armanis of the world, but kept our brand DNA. So, you saw before-and-afters all over the place that you wouldn’t normally see on the main floor of Selfridges. That really showed that we had a home there, and we were super successful.

What did you do to lift brand recognition?

Slater Ray: We really got the industry to fall in love with the product, and we were very strategic by focusing on the hero product. We only talked about CC Cream in the beginning. That was the entry into the brand, and we took that approach with influencers, PR and trade. I got Jamie on the CEW board to make the brand feel like it was a real brand and not this under-the-radar brand. We were chosen by Beauty Inc. as the prestige brand of the year. Carol [Hamilton, group president, acquisitions at L’Oréal] said, “OK, now we have to buy them.”

Motzko Hamilton: From a merchant retail lens, we needed someone on the team that could bring more clear and concise messaging to the consumer. They would come and present a new launch, and there were a million things on the graphics. You only get so much time with the customer, you have to be clear and concise on your purpose for them to purchase. That’s still relevant.

Whether it’s Amazon, their own direct-to-consumer, TikTok, they need partners in a room to make them understand, yes, you need to hold on to the DNA of your brand, but we need to help you understand how to translate that to retail to talk to the consumer to actually convert.

How can a brand convince a retailer to bring it in?

Motzko Hamilton: It comes down to the narrative. You have to go in to a retailer with the lens of, why would that retailer want your brand? It’s super competitive today, and the retailers are all looking for new reasons for the customer to come into their stores versus others. Data is always helpful.

We’re working with a K-Beauty brand. They were doing well globally. They were doing a lot on Amazon, TikTok, I mean high rankings doing a ton of volume, but they had no idea of how to go into retail. When Allison jumped in, she said, “Let’s show them that you are successful and ultimately are going to bring traffic to Ulta.” Brands can lean into their current wins because that will set them apart from other brands. If you don’t have some sort of traction on social, it’s like a dead end for a retailer.

You are on the board of All Golden, a new brand aimed at older consumers started by beauty industry veteran Sarah Kugelman. How can a brand win with baby boomer, gen X and older millennial consumers?

Slater Ray: I don’t think it’s any different based on the consumer you’re going after. Talk to them how they want to be talked to, use their voice and a message that’s relevant. It is answering that question of, what’s in it for the consumer? With IT Cosmetics, Jamie drilled in on this. Every decision had to be made with the consumer at heart. A lot of brands say they’re doing things with the consumer in mind, but they’re not necessarily doing that.

Sarah Kugelman has a track record. She’s built brands. She was an e-commerce guru before anyone else. So, she knows what’s been missing for our age group. No one is talking to us, and if they are, they’re only talking to us through, we all have gray hair and look old. How do you talk to us in a way that 50 is the new 30? I think I’m 25 on most days, but I have different problems. I’m perimenopausal, and every day I have a new thing. Like, why do my boobs hurt now? We want something that’s going to address our concerns.

In the past few years, many beauty brands chased TikTok virality. What do you think about the push for virality?

Slater Ray: I don’t think you can plan for virality. I don’t think you should. First of all, when you do go viral, no one’s ever prepared. I’ve never heard of a brand being like, “We went viral, and I had enough inventory.”

Look, if you do go viral, you have to anniversary that next year. What’s the chance you’re going to anniversary a viral moment? Unless you are never planning to sell to someone and want to stay independent forever, you’re going to have to answer that somehow.

Do you see people return from a viral moment? I feel like you’re less likely to see those return customers. I’m making it sound like it’s a terrible thing. It’s not a bad thing, it’s just not something I would ever plan for or set yourself up for. You could end up in a really bad situation with a lot of inventory problems.

You’ve seen brands get back to traditional marketing strategies. What traditional strategies do you feel are relevant now?

Slater Ray: There’s something interesting about direct mail and catalogs. I noticed this holiday season that I started getting more catalogs than I usually do, and I actually went through them for the first time in a long time. I was excited about it. Oftentimes, it did come with a promotion. It was nice to get something in the mail that’s not a bill. Obviously, there’s been a huge increase in out-of-home.

That human connection is something that we’ve lost in the digital era. Out-of-home is a great example of things that come back. It’s cyclical. They go one to extreme, everybody’s trying to do digital, and it becomes so competitive. You’re always trying to evolve and think about what the consumer wants.

Motzko Hamilton: There’s a return to in-person meetings and experiences, but doing them in a way that’s affordable. You’ll see multi-branded K-Beauty pop-ups. It feels old school in a way. If you look at the new formats of malls and how they’re evolving, everything is about the experience. How can brands bring their brand to life via an experience?

How should brands participate in big beauty trends, which are often pushed by Sephora?

Motzko Hamilton: It always goes back to what’s authentic to your brand. If you historically have been a lip brand and there’s a new lip trend that’s happening, you absolutely should be able to pivot and be a part of that trend. If you are a brand that’s never had lip and then all of a sudden you want to be the cutting edge of lip, you have to think about, what is authentic to your brand and how are you spending your dollars?

I’ve seen a lot of brands try to react to every trend, and it doesn’t work out for them because they’re spreading themselves so thin. Trends are going to come and go, and it is totally fine to say no to things if it doesn’t make sense for your brand.

What’s a misstep you’ve seen brands make regularly?

Motzko Hamilton: I’ve seen many brands over the years be really great in one category and then get overly confident to think they can just go into another category and win. A majority of the time, it doesn’t work. You can’t be a makeup brand and be like, oh, I want to do haircare. You have no credibility in that category. Sometimes a makeup brand can go into skincare if that makes sense for the DNA if they were always talking about skincare and how makeup can support it.

That’s where I’ve seen as major mishaps. They invest a lot of money from an inventory perspective and then the meat of the brand is put off to the side while they’re focusing on this new category that they can’t get the same return from.

Slater Ray: My two examples are two opposite extremes. One is being too reliant on any one product as your hero item. Glossier is in that situation today with their reliance and emphasis on their fragrance business.  Are you going to lose that customer and once she moves on from that hero, have you lost her? That’s a risk. In general, if you have more than 50% of your sales in any one product, you’re in trouble.

The second thing I would say is, when you’re too focused on newness, you don’t put energy and funding behind core products that are those core replenishable products. I’ve seen challenges when people are launching a product and not thinking about the use-up rate, and how quickly someone’s going to come back to repurchase. It’s easier to get your core customer to keep coming back than to bring in a new customer.

One of the things that we talk to brands about when they’re looking to go into retail is, what’s your return rate? How are people coming back to the brand? More SKUs does not equal more sales. It can cause more problems for you all around. Having hero SKUs is really important. When you are innovating and bringing a newness, you want to always uplift your hero SKUs.

With the TikTok ban still a possibility, should brands be diversifying if they’ve been on the platform?

Slater Ray: One of the things that I always say to any brand is, what’s your end goal? Do you want to own this brand forever and continue to operate it? Then, you could do whatever you want. But if you are planning to get investors or planning to sell, you have to look at what’s going on in the industry. There was a time that brands would be invested in or bought that were social media darlings, but now providing that you can work in retail is key to anyone investing and buying you. If you’re doing well on TikTok, there’s going to be interest from retailers. It’s just, what’s your narrative and how can you win in retail and why?

Motzko Hamilton: And is your strategy going to keep you around long term? Ulta and Sephora, they’re going to want to bring in brands for the long haul. Because the consumer has so many options and social has made it so things are changing so quickly, longevity is really important. If you’re just a TikTok brand and it’s all based on promo, how is that going to be around in the beauty industry five years from now? It’s showing your strategy of, is it profitable? Is it sustainable?

I was really happy coming out of COVID because we had an opportunity as an industry to not be so promotional. As we can all see, we’ve become promotional again. You have to ask yourself, what is the purpose of this promotion? Majority of the time, it should be for customer acquisition without compromising the DNA of the brand.

You have to understand, is this going to bring a new customer and if so, what is the strategy behind it? How is the retailer getting behind it? What’s the purpose of this promotion within the retailers? Because not all promos are created equal, and I don’t think you always have to be promotional. If anything, less promos can add more credibility, but ultimately you still have to be competitive.

I always come from a place of fewer, bigger, better. If Ulta’s running a big event and many of the brands that are credible are participating and there’s this clear strategy for customer acquisition for the brands, absolutely consider it. I don’t think that you should be doing promos to buy sales. That’s where you can get yourself into a lot of trouble. Once you start, it’s hard to stop.

We’ve seen a lot of brands launch on Amazon earlier in their life cycles. What’s the right time to launch on Amazon?

Slater Ray: it depends where they are with retailer negotiations. If you are not already there and you’re looking to get into retail, I wouldn’t launch right before, but I think a brand should be where the customer is and we know the customer is on Amazon, so give them what they’re looking for. Just be careful with how you manage it. You have to ensure that every channel has a strategy and a purpose. Maybe your Amazon strategy is just replenishment, but you don’t necessarily present newness there.

What do you hope for the future of beauty retail?

Motzko Hamilton: I want more retail shopping options. As society is changing, everybody just wants to have fun in retail. Retailers need to think about, how do they make it more fun and interactive? It’s all about connecting with the customer, which is a clear difference from Amazon.