October 25, 2014
For consumers, the notion of a “freebie” seems an innate part of our human identity, nowhere removed from our desire for self-fulfillment and tendency for self-improvement; we love free things. We also love competition and the uncertainty that lies at its foundation – the thoughts of winning and of losing equally driving our adrenaline. Taking all of these things into consideration, beauty data startup Poshly has leveraged consumer enthusiasm for giveaways into valuable data for the beauty and cosmetics industry.
Beauty and cosmetics is a large industry – valued at $382 billion, Poshly would be mistaken not to take advantage of a tremendous opportunity. Founded in 2012 and based in New York City, the company offers consumers various cosmetics giveaways on their website from premier beauty brands, including the likes of philosophy and L'Oréal. To enter any one giveaway, users must simply complete questions on an online quiz that is personalized per consumer. From there, users can move on to another giveaway or continue answering quiz questions in order to gain extra entries to a particular giveaway.
“From day one, we knew that there was something really special and important about consumer data when it comes to beauty and personal care,” said cofounder and CEO Doreen Bloch. “We were inspired by the challenge that most women have with finding the right products for their unique preferences. The idea evolved when we realized that people would be happy to share their data with us if we could empower them with products that they truly love.”
By engaging consumers in giveaways that require them to answer questions about their personal interests, beauty routines, habits, et al., Poshly is able to gain additional insight on overall consumer preferences. This data is useful for two reasons: on the consumer side, Poshly enables women to find the right products that fulfill their exact wants and/or needs; on the brand side, companies get a better idea on their market(s) and allow them to create better strategies for such things like future product offerings or retail channel roll-out.
Bloch and her cofounder Brad Falk met while at brokerage startup SecondMarket. Prior to that, Falk also worked as an engineer for beauty brand Bare Escentuals, making Falk's role as CTO for Poshly all the more apropos. And, while it may seem that the beauty industry is miles apart from finance, Bloch said that it was actually an exciting transition:
“Both of us were fascinated and excited by the potential to apply our passion for and expertise in data technologies to this large industry. There are major differences in the industries, but both are driven by a need to match people to the products that are best for them – both finance and beauty have marketplace dynamics.”
In August of this year, Poshly closed a $1.5 million seed round – a sign that the combination of beauty and data is paying off for the company. Bloch noted that with this funding, Poshly can further invest in product development to work on new features for both brands and Poshly members.
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