Rodan + Fields selfies and social media $1 billion revenue
Rodan and Fields met at Stanford during their medical residency in 1984 as they were studying to be dermatologists. Someone had advised them to “get a hobby or you’ll be doomed to treating acne and warts,” Fields said. But skincare was their passion and their hobby.
“There’s an incredible link between self-esteem and the quality of people’s skin,” said Rodan. “When you look good, you feel good.”
The two decided to focus on combating acne and skin discolorations, and created their famous preventative acne product Proactive in 1995. That was sold through direct marketing company Guthy-Renker, which joined with Nestle to buy the remaining rights to the product’s royalties in 2015. Rodan and Fields were paid a lump sum estimated at $50 million at that time according to Forbes.
The women launched the Rodan + Fields line in 2002, for products like anti-aging regiments, sunscreens and blemish removers. At first they sold those items at Los Angeles boutique Fred Siegel. But after finding it hard to gain traction from just one store, they sold to Estee Lauder the following year.
By 2007, the market had changed and the entrepreneurs saw an opportunity. As department stores were on the decline, the internet was presenting new avenues to sell and novel ways to promote.
“We started thinking, ‘We’re giving 50 percent of the margins to the department store, where the department store is only giving up some shelf space,'” Rodan said. “We should be giving those margins back to the people who use the product, love the product and want to talk about the product with their friends on social media.”
Then came the iPhone. Rodan and Fields saw that the popularity of selfies combined with social media made for free and authentic advertising. They encouraged their customers to take before-and-after pictures and even included a picture of a camera on product boxes.
“You can’t ask for better marketing,” Fields said. More recently, “Instagram is just a rocketship for the product,” she said.
It’s rare — though not unheard of — for founders to repurchase their business. When its your name on the brand and the brand is struggling, sometimes the creators are the only ones who can revive it.
“Once you buy back your business, you have a difficult but exciting road ahead of you,” Fields said. “If you believe in your product, you will see it through to the end.”
This content was originally published here.