How A Single Product Changed Haircare Company DpHue’s Trajectory
DpHue’s business is clearly demarcated pre-ACV Hair Rinse and post-ACV Hair Rinse. Before its bestselling product, the company had two hair color bars and was inching along as an at-home hair color specialist. After its bestselling product, DpHue joined the beauty industry big leagues as a haircare brand to be reckoned with. “Our apple cider vinegar product really led to the entire pivot of DpHue as a company from being a color bar concept to a product-focused company,” says Martin Okner, president and CEO of DpHue, which was founded by Donna Pohlad in 2011. “Donna saw the market potential of taking this brand to a national and eventually global level as a consumer products company centered around keeping color fresh.” Beauty Independent pressed Okner and Pohlad for details about ACV Hair Rinse’s fortuitous rise and promising outlook.
Launch date: February 2014
Sales growth: Year-to-date sales are five times more than sales at this point last year.
Total retail doors: Roughly 1,100
Product development: ACV Hair Rinse’s origins are in Pohlad’s quest to formulate an alternative to traditional shampoo that wouldn’t strip hair color from strands. She pinpointed apple cider vinegar, which her mother had used internally and externally to great effect, as an ingredient to form the basis of that alternative, but finding an apple cider vinegar that appealed to her wasn’t easy. Bragg and Heinz marketed varieties of the vinegar that didn’t suit Pohlad’s smell preferences or quality standards. She stumbled into an oil and vinegar shop, and asked for an apple cider vinegar that wasn’t from Heinz or Bragg. The shop didn’t have any. However, it directed her to George Paul Vinegar, a company in Nebraska that now supplies apple cider vinegar for DpHue’s ACV Hair Rinse.
“It’s a beautiful apple cider vinegar,” says Pohlad. “It smells like apple cider vinegar, and we didn’t fragrance it because we want people to know it’s the real deal.” She adds that the apple cider vinegar is paired with aloe vera, argan oil, fire tulip and lavender extract in the ACV Hair Rinse. “We say it’s the best of science and the best of nature,” asserts Pohlad. “Apple cider vinegar closes the cuticle and makes your hair feel soft and, with the other ingredients, we wanted to make sure that, depending on your hair type, you didn’t necessarily need a conditioner.”
Retail price: ACV Hair Rinse is priced at $35 for an 8.5-oz. bottle. It’s priced to be positioned at the prestige end of the haircare market. Pohlad specifies that the apple cider vinegar from George Paul Vinegar is 10 times the price of most apple cider vinegar, leading to the elevated price that’s justified by the elevated quality and performance. The packaging elevates the product, too. Okner mentions the mustard-style cap on top of the ACV Hair Rinse bottle enables people to separate their hair to apply the rinse at the roots. He says, “Part of what makes the product really unique is its application, user experience and look.”
Distribution strategy: When ACV Hair Rinse was introduced in 2014, it was only sold at DpHue’s locations in Minneapolis and Los Angeles. The next year, the company plunged into negotiations with Sephora and Ulta Beauty. “The product really stood out and brought people into the brand,” says Pohlad. In 2016, DpHue went live on Sephora’s website and entered 875 Ulta Beauty doors. Scaling up for the retail rollout was a major accomplishment. Pohlad says, “Being based in Minneapolis, there’s quite a number of people here with industry experience. Aveda and Target are here. We hired a company that had done a lot of logistics work for Target, and we were able to find the right people to plug the gaps that we had.”
Media milestone: DpHue brought on board Mark Ferdman, formerly vice president of global consumer engagement at Estée Lauder, as CMO in 2016 and set out to open DpHue House, a content hub in LA. The brand generates social media content and advertising at DpHue House. “From an operational standpoint, it creates so much efficiency for us. We can react to market dynamics quickly and are able to get an early read on how consumer adoption is going for a specific product or message,” says Okner. DpHue House serves as a playground for celebrity hairdresser Justin Anderson, creative director for DpHue, who can bring his clients in to showcase the power of the brand’s products on the tresses of the envied and eminent in Hollywood. Retail buyers and influencers also pop by to do social media shout-outs and takeovers.
Hiccup along the way to success: Sampling is an important vehicle to introduce customers to ACV Hair Rinse. In a sampling run, DpHue produced 1-oz. bottles with regular shampoo caps and felt they fell flat on the experience front. So, the brand retrofitted the bottles with mustard-style caps to replicate the packaging of its full-size products. “The mustard caps provide the consumer with the maximum user experience even with a tiny 1-oz. size,” says Okner. “That was a significant investment for a small brand, but we have an uncompromising view of quality.”
Maintaining momentum: DpHue has judiciously expanded its ACV franchise. ACV Leave-In Hair Therapy was the sophomore ACV product. “We add products that make sense and that we can stand behind,” says Pohlad. “We launched Leave-In Hair Therapy because we thought we needed a product to combine with the rinse for detangling.” ACV Scalp Scrub, ACV Dry Shampoo and ACV Hair Masque, the latest ACV entrant, followed. DpHue has extended the size range of ACV Hair Rinse into travel and jumbo options. “ACV is the on-ramp to our brand. We need to be really careful about what we innovate and call ACV,” says Okner. “It really has to be something that rounds out the consumer experience and creates a different usage occasion that allows the consumer to explore a new dimension of the brand.” Pohlad is toying with a product idea to push the ACV line to six items. She says, “I am really not interested in putting out another SKU on the shelf to take up room. I feel that everything that we put out, we have to be able to talk about in a super genuine way and really believe in it.”
Retailer take: “We very quickly identified DpHue as an emerging brand our guests would love and, since it launched in 2016, we have been proven right,” says Sandy Ovington, vice president of merchandising for Ulta Beauty. “DpHue’s Apple Cider Vinegar line is becoming increasingly popular due to the large number of guests seeking a healthier lifestyle as well as those with an interest in natural ingredient stories. We know guests appreciate easy-to-understand ingredients, and DpHue delivers with Apple Cider Vinegar products infused with argan oil, aloe vera and lavender extract.”