Wednesday, 29 August 2018 08:11

Multiplying Profit$ through Custom Skin Care

Written by   Rachael Pontillo, M.Msc, CIHC, CNAP, LE

Custom skin care is a trend that has gained momentum rapidly over the past decade. Often, skin care is formulated, marketed, and delivered according to basic skin types – oily, dry, sensitive, mature, combination, and so forth. While certain skin symptoms, like dryness or uneven tone and texture, might have similar general causes, how and why those symptoms manifest may vastly differ from person-to-person based on bioindividual factors, such as diet, lifestyle, ethnicity, medical history, stress levels, exposure to toxicity, and so forth.

As a result, finding a skin care line that works is not an easy feat for many people. No one product works optimally for a person forever – whether it is the skin or the product itself, something always changes. Once a client finds something that works and invests the money and time into that regimen, when changes occur it can be extremely frustrating to have to go back to the trial and error associated with finding a new line that works. The client may go back to their aesthetician for suggestions, but what happens if that aesthetician only has training on one or two product lines and neither work for that client?
With custom skin care, professionals can get more specific, assessing and treating skin with consideration to the whole person, tailoring and adapting treatment as the client’s needs change due to aging, environmental or seasonal changes, and the epigenetic factors above. Custom skin care gives professionals the ability to understand ingredients and formulation well enough to be able to provide a new solution on the spot. This not only benefits the client – it also elevates business. Professionals have full control over the cost, markup, inventory, quality and type of ingredients, branding, and delivery of the range. They can set the MSRP and never worry about a favorite product getting discontinued or reformulated again. Depending on which custom skin care business model is chosen, retail competition could even be eliminated.

Fortunately, there are many ways to offer custom skin care solutions in the spa, ranging from simple, targeted add-on products and treatments to making completely bespoke products from scratch. Many existing product lines now offer customization options and add-on spot treatments to help tailor clients’ regimens specifically within that range. Some have gone even further and have developed their own custom skin typing methodologies which involve the client in the process of understanding his or her own skin better, either via consultation or technology.2
Though this type of customization still limits both the practitioner and the client within the boundaries of what ingredients and formulations are available within that brand, it can still be beneficial. Involving the client in the process, whether through deeper consultation, or technology, is also more likely to increase homecare compliance and yield both results and repeat sales. What this model does not do is eliminate competition, since multiple spas and websites can offer brand-specific customization. While some companies do still try to protect their accounts within a certain geographic region, this is becoming more difficult.
One way to mitigate this issue, while still using an existing product line, may be to private label the products and white label that company’s customization process. This way, the client’s perception is still that the products and expertise is exclusive and the professional can control the branding aspect of the model. However, ingredients, availability, profit margin, minimum ordering requirements, and lack of control of the ingredient quality or formulations will still be limiting factors.
One step closer to total customization that many aestheticians have already been doing for quite some time is to purchase pre-made cleanser, lotion, cream, and mask bases and customize them for clients by adding essential oils, fragrances, herbs, and so forth. One benefit to this is that the manufacturer of the base assumes product liability for those bases, though the practitioner still needs to follow state and local laws pertaining to how the bases and raw materials are stored, mixed, packaged, and dispensed. Another benefit is that the practitioner has more customization options than he or she would have using complete products, as the products themselves can be customized, rather than just the regimens. This option also allows for freedom in terms of branding and exclusivity. The drawbacks of this model are that while ingredients added to the bases can still be controlled, there is no control over which ingredients are in the bases themselves or whether or not those bases get reformulated or discontinued over time. Limits on profit margin and order minimums might also be limiting factors.

For practitioners who want total control of costs, ingredient quality, sourcing, type, formulations, inventory, branding, and exclusivity, making a custom skin care range is a viable model with multiple options. The idea of custom formulating products and treatments for individual clients at each service may sound challenging and time consuming – and it can be – but it is not the only way to offer completely custom skin care to clients. There are several ways to do it – from creating custom bases that can then be customized further to restricting on-the-spot custom orders to products that are quick to make.
The biggest challenge with this model is pricing and time management because, now, skin care is not being sold as a product, but rather as a custom skin care service. Not only is it necessary to make sure costs are covered in terms of ingredients, packaging, and labeling, but it is also necessary to build research and development, consultation time, and formulation time into the package. Time management skills are paramount in this model, as professionals must balance formulation time with consultation and treatment time.
Many aestheticians are under the assumption that it is illegal to sell handmade products from the spa. While some states have more stringent laws than others, it is legal to provide custom skin care solutions in every state. It is, however, necessary to understand and comply with the state and local laws regarding what is allowed to be done in the spa. Some states require separate dedicated spaces for manufacturing, storing, and dispensing products, while others do not. Some states allow for products to be made in a home kitchen while others do not. Some states and practice liability insurance companies require that aestheticians and spas use and sell products from existing skin care companies. If that is the case, it may be necessary to update the business model, state registration, and business licenses and to purchase product liability insurance.
Compliance with Food and Drug Administration (FDA) and Food and Trade Commission (FTC) guidelines in terms of cosmetic labeling, claims, and marketing will also be needed. Using strictly cosmetic terminology and veering away from any claims that imply that products have the ability to alter the structure, or function, of the skin is necessary. Understanding what requirements are necessary in terms of client consultation, record keeping, safety testing, usage instructions, preservation, and microbial and stability testing is also imperative.
The benefit of this model is that professionals have 100 percent control over every aspect of their custom product range. They decide which ingredients to carry, where to source them from, what ingredients to use in each product, what the treatment room protocols are, and what the homecare protocols are. They also decide how to price this model for maximum profit margin. They can choose to price the products into an initial package deal, charge additionally for consultations, reformulations, product replacement, or price each piece of the process à la carte. Different versions of products can be offered at different price points to allow for greater accessibility to custom skin care within the community. Branding is completely within the professional’s control, as are marketing decisions. As little or as much inventory as desired can be carried.
Most importantly, competition is virtually eliminated and the professional becomes the go-to skin care expert in their community. While other spas might offer custom skin care as a service, these formulas cannot be easily duplicated. Once clients see how it feels to have their own personal skin care expert making products specifically for their skin – with the ability to adjust the products at any time to maintain results – the relationship with the client is solidified, loyalty is ensured, and word-of-mouth referrals will increase. Expertise as a true skin care expert will be elevated far beyond the limits of what is learned about ingredients and products from a vendor. Every time that client needs new skin care (which should be every month), he or she needs to come into the spa and is more likely to purchase additional products or services.

Most clients are familiar with going to the spa to receive a service and then being offered products to purchase for homecare. When custom skin care is offered as a service, it is necessary to focus on the “why” behind the service, and the results that come from the extra investment.3
Rather than focusing on simple before-and-after pictures and testimonials, it is important to understand what clients are actually getting when they choose to go custom. They are getting peace of mind that they do not have to worry about skin care anymore. They are gaining a trusted advisor and confidante that not only provides a great facial and sells nice products, but who really understands how to choose ingredients for their skin and make products that they will love to use. They are getting the confidence that if, and when, their skin changes for any reason at all, they already have a backup skin care plan in place. They are getting the assurance that their custom products also meet their philosophy around ingredient type and safety, which is so important in today’s increasingly holistic market.

Whether the decision is made to offer custom skin care solutions within an existing product range or to make them from scratch – or any point along the path in between – a sound business decision is being made. Just like any other progress within a business or growth as a professional, continuing education, financial investment, and diligent compliance will be required. Having the ability to price and market products and services effectively will also be necessary.
However, when professionals see how much sooner clients get results, how much more often they come into the shop for product adjustments and treatments, and how many referrals come, they will see that the rewards for their efforts go far beyond Return on Investment (ROI).

1 Sample, Ian. “Bespoke Diets Based on Gut Microbes Could Help Beat Disease and Obesity.” The Guardian (2015).
2 “13 Trends Shaping the Face of Beauty in 2018.” Corporate Innovation Trends 3 (2018).
3 Drake, Maxine and Rachael Pontillo. “Build A Standout Brand With Your Own Skincare Line.” Maxine Drake. June 13, 2018.

Rachelle Pontilla2018Rachael Pontillo is the bestselling author of Love Your Skin, Love Yourself, and co-author of the cookbook, The Sauce Code. She is an award-winning, AADP board-certified, holistic health and image coach, certified metaphysical practitioner, licensed aesthetician, natural skin care formulator and educator. She is the creator of the popular blog and lifestyle website and the six-week online course, Create Your Skincare.™ Pontillo is a recipient of the Institute for Integration’s® esteemed Health Leadership Award and is also a brand ambassador and spokesperson for NeoCell.™ Pontillo is currently working towards a Ph.D. in holistic life counseling.

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