Beauty Imagined: A History of the Global Beauty Industry is the first serious attempt to trace the history of the $330 billion global beauty industry and its large collection of fascinating entrepreneurs through countries including France, the United States, Japan, and Brazil. What's taken so long?
According to author Geoffrey Jones, the Isidor Straus Professor of Business History at HBS, the fragmented, secretive, often family-owned businesses that have constituted the industry have been difficult for scholars to unlock. Couple this with the fact that most business historians are male, and you have a major industry that still has lots to reveal. We asked Jones to discuss his research and his new book.
Sean Silverthorne: What inspired your interest in the beauty business and its history?
Geoffrey Jones: My initial interest in the beauty industry was triggered by my earlier history of the consumer products giant Unilever, published some years ago. This company had a long-established business in soap and other toiletries, but spent decades after World War II striving without great success to expand its business into other categories of the beauty industry, such as skin care and perfume.
As I researched this story, I realized both the huge size and the importance of this industry—and the remarkable paucity of authoritative literature about it. Or more precisely, while there are numerous books on various aspects of the beauty industry, from glossy coffee-table publications on cherished brands of perfume to feminist denunciations of the industry as demeaning to women, there were few studies that treated beauty seriously, as a business. So I saw both a challenge and an opportunity to research the story of how this industry grew from modest origins, making products that were often deemed an affront to public morality, to the $330 billion global industry of today.
Q: Why has this industry been so neglected by business school faculty?
A: I think there are two reasons. First of all, this is a difficult industry to research. Historically, it has been quite fragmented, with many small and often family-owned firms whose stories are hard to reconstruct. The industry as a whole is well known to be secretive—after all, its foundations rest heavily on mystique.
And then there is the frequently observed gender bias in business school faculty. I suspect male faculty, who comprised the majority in most schools until quite recently, regarded this industry as a feminine domain and rather frivolous, and felt more comfortable writing about software or venture capital than lipstick and face powder. As female faculty built careers in business schools, they may also have been disinclined to conform to assumed gender stereotypes by working on beauty. The fashion industry, which is also huge, suffers from the same lack of attention from management researchers.
Q: You write, "Beauty emerges as an industry which was easy to enter, but hard to succeed at." How so?
A: It does not take a great deal of capital nor technological expertise to launch an entrepreneurial venture in many beauty products—although for such a venture to have any hope of success, high levels of imagination and creativity have always been required. If you have a concept for a new brand, and the necessary finance, there are contract manufacturers and perfumers that will provide a product for you.
This is also an industry subject to sudden shifts in fashion and fads, which disrupt incumbent positions and provide opportunities for new entrants. Brand loyalties are often weak, especially for "fun" products like lip and eye cosmetics, although less so for foundation, because it is more expensive and needs to be a good match with skin tone.
Achieving sustainable success in the beauty industry is another matter. It is fiercely competitive, with thousands of product launches each year. Even the largest, most professionally managed global companies find it hard to predict the success of product launches, and can stumble badly. One estimate is that 90 percent of new fragrance launches fail. Getting the word out to consumers, and getting product through the distribution channels to consumers, provide further major challenges for new ventures. Creative talent, astute marketing skills, and the ability to understand and respond rapidly to consumer fashions and preferences are all needed to succeed. There are fortunes to be made by building a successful new brand, but it takes an enormous amount of work and good luck to succeed.
Q: You artfully portray a vivid, passionate cast of entrepreneurs. Which do you consider the most influential? Do you have favorites?
A: The book emphasizes the role of individual entrepreneurs in building this industry. They varied enormously in their backgrounds and characters, but most shared a passion for the beauty industry, combined with an ability to understand the societal values and artistic trends of their eras, and to translate them into brands.
François Coty stands out as a creative genius in the formative stages of the industry in the early 20th century. Born as Joseph Marie François Spoturno on the Mediterranean island of Corsica, which was also the birthplace of Napoleon, he was a complete outsider to the traditional Parisian perfume industry. He went on to transform it. Assuming an adapted version of his mother's maiden name as he strove to create a brand that symbolized style and elegance, he got his first order by smashing a bottle of his perfume on the floor of a prominent Parisian department store, in a successful gambit to get customers to smell it. He created two entirely new classes of perfume, soft sweet floral and chypre, and was the first perfumer to sell his wares in elegantly designed glass bottles, rather than in the pharmaceutical bottles used previously. An ambitious believer in globalization, he even sent his energetic mother-in-law to open up the American market in 1905. The American business proved so successful that its U.S. sales reached the equivalent in today's terms of half a billion dollars by the end of the 1920s, before the Great Depression eviscerated what had become the world's biggest beauty company.
Coty was a larger than life character, but he was hardly alone in this industry in that respect. The cast of influential and colorful characters includes Madam C.J. Walker, the daughter of former slaves in Louisiana who developed a system for straightening African-American hair, which was so successful that she ranks as among the first American self-made female millionaires. And then there was the ever-feuding Helena Rubinstein and Elizabeth Arden, who transformed beauty salons from places considered the moral equivalent of brothels to palaces of opulence and style. And in our own time, Luiz Seabra stands out as the founder of Brazil's biggest beauty company, Natura, which is dedicated to environmental sustainability with a broad social vision.
Q: How much does the industry influence our notions of beauty, and how much do accepted or popular notions of beauty influence product development?
A: The human desire to attract reflects basic biological motivations. Every human society from at least the ancient Egyptians onwards has used beauty products and artifacts to enhance attractiveness. However, beauty ideals have always varied enormously over time and between societies.
The book shows that as the modern industry emerged in the 19th century, it facilitated a worldwide homogenization of beauty ideals. Beauty became associated with Western countries, and white people, and with women. These assumptions reflected wider societal trends. Western societies as a whole underwent growing gender differences in clothing and work. And this was the age of Western imperialism. The industry's contribution was to turn these underlying trends into brands, create aspirations that drove their growing use, and then employ modern marketing methods to globalize them.
I see beauty companies as interpreters of prevailing assumptions and as reinforcers of them. The debate is how much autonomy beauty companies have to shape ideals. Unilever's current Dove marketing campaign, which uses senior women as models to make the point that one can be beautiful beyond one's 30s, shows that a large company has the power to challenge stereotypes should it wish to do so.
Q: What was the impact of television both in helping define beauty and in developing the industry?
A: During the late 1940s, television spread rapidly across the United States, and soon afterwards elsewhere. Television offered remarkable new opportunities to take brands into people's living rooms, and it drove advertising budgets sharply upwards.
Charles Revson was a master of using the new medium to grow brands. Revlon's fortunes were made through its sponsorship of The $64,000 Question game show that began broadcasting on CBS in 1955. Later it emerged that the show was rigged, a scandal that even led to congressional hearings, but this had no discernible impact on either Revson or his company.
Television also proved a medium that new entrants could use to challenge incumbents. During the late 1950s, Leonard Lavin used television advertising to grow the tiny Alberto-Culver hair care business into a significant national player.
More recently, home shopping channels such as HSN and QVC have become important places to launch new brands. However, the impact of television was not limited to marketing. Color television drove innovation in makeup, which was subsequently diffused from actors to the wider public. And as the United States became a major source of television programming worldwide, it proved a major force for diffusing American ideals of lifestyle, fashion, and beauty worldwide.
Q: What do you think were the most significant products that marked its evolution?
A: I would begin with soap. The technology to make soap was known for several thousand years, but the product was rarely used for personal washing, especially by Europeans who largely avoided washing with water after the Black Death in the Middle Ages, believing it to be dangerous. Then, as public health concerns rose during the 19th century and water began to be piped into people's houses, a number of brilliant entrepreneurs built a demand for soap as a branded product by linking its use to godliness, securing celebrity endorsement, and later suggesting that the use of some brands would bring romantic success. Using soap for washing became associated with Western civilization, and even as an essential entry ticket for immigrants seeking to become true Americans.
The transformation of perfume also marks an important stage in the evolution of the modern beauty industry. In the early 19th century, perfume was made in small batches, rarely applied to the skin, and drunk for health reasons. There was a narrow range of available scents. A hundred years later, the application of new technologies to extract essences from flowers and plants, and to create synthetic fragrances, had transformed perfume. Historically, perfumes were reminiscent of one individual "note"—to employ the musical metaphor used in the industry—which tried to replicate nature. The new perfumes had a vastly increased range of scents; were far more abstract, with three notes; and offered scents not found in nature. Meanwhile, a marketing revolution had turned perfume into a branded product, sold at different price points in different distribution channels, and increasingly gendered. While historically men and women had used the same scents, they now began to like to smell differently, with scents now reminding genders of their roles in the world.
As for decorative cosmetics, the story of lipstick is really interesting. While the use of lipstick, like many cosmetics products, reaches back far into human history, in the early 20th century it was still a product associated with actresses and women of dubious morality. Thereafter the use and acceptability of lipstick expanded. There was technological innovation—the first metal lipstick container was invented in Connecticut in 1915, and the first screw-up lipstick appeared six years later. By the time the United States entered World War II in 1941, the government declared the production of lipstick to be a wartime necessity, such was its impact on morale.
Q: What does this book tell us about the impact of globalization today and going forward?
A: As I have suggested, the emergence of the modern industry was associated with an unprecedented homogenization of beauty ideals throughout the world. During much of the 20th century, homogenization was further reinforced by the impact of Hollywood, the advent of international beauty pageants, and so on. Beauty was associated with Caucasian features, as interpreted by the twin capitals of beauty, Paris and New York. Although the momentum for homogenization was strong, it was striking that markets stayed differentiated by inherited cultural and social preferences.
And globalization today is working in a far more complex fashion. The geographical spread of megabrands and globalization of celebrity culture certainly suggests further homogenization. During the early 1980s, China's consumption of beauty products was close to zero. It is now the world's fourth-largest beauty market-and the top brands in cosmetics and skin care are the same as in the United States.
However, there was also a new sensitivity to difference and diversity, representing a new pride and interest in ethnic and local beauty ideals. The tremendous growth of skin lighteners in India and East Asia is one sign of this trend. While global companies are concerned that the core claims—and usually the core technologies of brands—have to be the same worldwide, there is now also a concern that the forms in which such claims were delivered, whether in jars or creams, should be relevant to local consumers in each market. Moreover, as global firms experiment with taking new beauty ideals around the world, they are becoming agents of diffusion for different beauty ideals. L'Oréal, for example, primarily sold French brands before the 1990s. During that decade it purchased American brands such as Maybelline, Redken, and Kiehl's and globalized them. And over the last decade it has acquired Shu Uemura in Japan, Yue-Sai in China, and Britain's Body Shop. Global firms are, in this sense, now orchestrating diversity, not homogeneity.
Q: Both men and women played huge entrepreneurial roles in the development of the industry. Was one gender better than the other, generally, in creating success?
A: It is tempting to speculate that since so many of the products in the industry have been and continue to be aimed at women, being a female entrepreneur would make one better at interpreting women's desires than a male entrepreneur. The industry has indeed seen a veritable roll call of influential female entrepreneurs. Over the last five decades alone, one can think of Estée Lauder and Mary Kay in the United States; Simone Tata, who virtually founded the modern Indian beauty industry; and Britain's Anita Roddick, the founder of The Body Shop. Among influential female business leaders today are Avon's Andrea Jung and Leslie Blodgett of Bare Escentuals.
Yet for every successful female business leader, one can find male equivalents, including the misogynist Charles Revson who built Revlon as an industry leader between the 1950s and 1970s; the British-born Lindsay Owen-Jones, who turned the French hair care company L'Oréal into today's global beauty powerhouse over the last two decades; and Shu Uemura, the Japanese makeup artist who created an exquisite, and now global, brand.
A further complication in reaching a definitive answer to whether there are gender advantages in this industry is that women are more likely to enter the beauty business than others, as the obstacles to entry for female entrepreneurs have been and continue to be higher for women than men in other industries, like construction, for example. So there is a lot of female entrepreneurial talent pooling up in beauty, while male entrepreneurial talent is spread more evenly across industries.
The book's position on this question is that gender is not a main determinant of success in this industry, but that status as an "outsider" of some kind was important. This helps to explain why so many successful figures in the past were immigrants, or Jews, or—indeed—female.
Q: What are you working on now?
A: I am writing a book on the origins and growth of green entrepreneurship worldwide over the last six decades. This idea originated out of my research on the beauty industry, in which I explored the growth of interest in "natural" products. This is now one of the hottest segments of the global industry, with estimated sales of $7 billion.
In recent years, natural products companies like The Body Shop and Bare Escentuals, the San Francisco company that has built the minerals-based cosmetic market, have been snapped up by global players paying large premiums. However, what really interested me is the time it took to make this market take off. As early as the 1950s, entrepreneurs like Jacques Courtin-Clarins and Yves Rocher began to experiment making cosmetics from plants rather than chemicals, decades ahead of perceived demand. They, and their counterparts in other industries such as food and cleaning materials who talked about the dangers of chemical ingredients and the need for environmental sustainability, were often dismissed as crazy, or at best irrelevant. Today, many of their ideas are mainstream.
This transition is the core of the book I am now researching. It will look at entrepreneurs and firms across a broad span of industries, and globally, that saw greenness as both a profitable and a socially necessary business opportunity, and that have led, rather than followed, regulators and public opinion in pursuit of their goals.
Excerpt From beauty Imagined: A History Of The Global Beauty Business
By Geoffrey Jones
Beauty amid War and Depression: The American color cosmetics market also expanded during these years. Still barely acceptable in 1914, product innovations made their use both more accessible and desirable. The first metal lipstick container was invented by Maurice Levy in Connecticut in 1915. The first screw-up lipstick appeared six years later.19 In 1916 Northam Warren created the first commercial liquid nail polish when he launched the Cutex brand of manicure preparations. A new form of mascara was invented by an Illinois chemist T. L. Williams, whose Maybelline Cake Mascara, launched in 1917, became the first modern eye cosmetic to be manufactured for everyday use.20 As usual, early adopters were young. In 1925 the concept of a "generation gap" was invented to describe the difference between mothers and daughters regarding the use of lipstick in America.21 By the end of the 1920s, three thousand different face powders and several hundred rouges alone were being sold on the American market.22
Hollywood was also playing a pivotal role. During World War I the American industry was able to pull ahead of the French firms which initially dominated the cinema industry. By the 1920s the industry, now concentrated in Southern California, was able to benefit from the size of its home market and its control of distribution markets to dominate both the American and international markets.23 Movie theaters reached almost every American town, diffusing new lifestyles and creating a new celebrity culture around movie stars that exercised a powerful influence on how beauty, especially female beauty, was defined.24
Max Factor forged the direct link between cosmetics and Hollywood. His work for actors resulted in the principle of "Color Harmony," which established for the first time that certain combinations of a woman's complexion, hair, and eye coloring were most effectively complemented by specific make-up shades. As he grew in fame alongside the movies, he also played a significant role in legitimatizing the use of cosmetics. In particular, he began referring to his cosmetics as make-up, a word long used by actors but not widely used more generally because of the disreputable image of actors.25 Now, for perhaps the first time in Western culture, actors could be thought not just beautiful on the outside but beautiful and respectable on the inside, too. That was a big change for people until recently regarded as barely above prostitutes.
Max Factor's store in Los Angeles also began to make wider sales. In 1916 he introduced Eye Shadow and Eyebrow Pencil for public sale, the first time such products had been available beyond the theatrical make-up line. Advertisements prominently featured screen stars, whose studios required them to endorse Max Factor products.26 A distribution company was contracted to penetrate the drugstore market, and in 1927 nationwide distribution of Max Factor cosmetics began. The date coincided with the premiere of the first talking movie The Jazz Singer, at which Max Factor and his family were in attendance. 27