​This edition of Industry Voices is very special as it features an individual that has been a big factor behind the success of the Canadian Cosmetic Cluster. Since meeting Lucas Nanini at the Cosmetic 360 Show in 2017, I have had the best fortune to have an extraordinary industry professional to support my cosmetic endeavours. Lucas Nanini the Co-Founder and COO of Noleo, has been in the cosmetic industry for over 10 years. He started his early days at P&G. He then followed their luxury cosmetic division to COTY. This year Lucas has left the cosmetic corporate world to make his own path in the industry with projects like NOLEO and the Good Face Project. In this segment, Lucas shares his thoughts on product innovation and development.
 
 1. What brought you to the world of cosmetics?  

I was doing an internship at P&G in Beijing, China in 2007. I was working on innovation for laundry products, for example; hand wash for the low-income market. Nothing could be further connected to the world of cosmetics.
 
One of the many challenges I experienced during this time was to understand why our bag of laundry powder (which we had just cost saved) was blistering over time. As I was putting together my design of the experiment, a French manager in Shanghai, Tanguy Pellen (who then became my boss a few years later), was visiting the Beijing office to review this project and the issues. At that time, P&G was launching a Gucci fragrance. There was a high level of detail on the packaging, and their challenge was to check if the Fashion House would approve the physical execution of what they would have initially put on paper (or how Art translated into Science). 
 
Home Products and Luxury Fragrances are both incredibly complicated sectors of the cosmetic industries in their own right. But I loved the complexity that came from pushing the boundaries of aesthetics and artistic creativity more. This attracted me to luxury cosmetics as opposed to the challenges of manufacturing and cost-saving homecare products.
 
It has helped me however to know both ends of the spectrum, especially when looking at consumer-centric design and innovation.
 
 2. What are the most important innovations in cosmetics of the past decade? 

I have three that come to mind when observing the industry and what has been done in the last decade. 
 
First, I really think L’Oreal made a bold move by entering the IoT space, and what they did with Le Teint Particulier. It was remarkable because it met an important consumer need around personalization. But more importantly, the work that L'Oreal is doing in consumer data collection is super smart: with this, you can design better product, but also work on predictive modeling tools; smart move.
 
Next, I simply cannot answer this without adding one of the products that I worked on. This product was the SK-II Magnetic Wand. I was working with the Singapore, and Japan team at P&G, to develop this applicator. And it was the first time in the industry that we looked at Physics (and more specifically diamagnetism) as a mode of operation for the driving of key ingredients into the skin, in addition to Biology (with the skin) and Chemistry (with our active ingredient). 
 
Last, a worthy mention is innovations in Microbiome applications. This is something that is in my opinion instrumental in our next curve of innovation, and we have only scratched the surface (pun intended) in this space. I look forward to seeing what would come out of this field in terms of research and development over the next three to five years.

 3. What should a startup cosmetic brand focus on when approaching innovation at a budget? 

I will try to step away from general tips like “know your consumer”, “know the market”. You can google that and find that information from many sources. 
 
Instead, I would encourage the startup to assess if this approach or technology is the “best” to solve this problem. By “best” I am not talking about performance. I want would like the startup to access the balance between performance, cost, limits in consumer habit change, and ease to scale.
 
It is important to remember to include in “best”: the team. Ask yourself do you have the legitimacy to drive this project? Is your business partner (don’t launch anything alone) the right partner with the right complementary skills? Are you clear about what is missing in the team and how you can compensate for that?
 
Last but not least, what is your “best protection”, or competitive advantage. It does not always mean, IP. It could be speed to market, supply exclusivity, claims and endorsement, etc…
 
The good thing about this process is that once you complete and analyze all these factors. You will be able to screen out 70% of your ideas, without spending any money.
 
​4.  What areas in product design are the most important to focus on? 

Two things come to mind for me.
 
The first is safety. I can’t encourage anyone to create a product that may be performing well but is not safe (without serious backed up data). In the world of cosmetics, nothing is worth getting ill for. This is what has been driving my business partner Nico and I every day at NOLEO. For us, if an ingredient is not essential, it shouldn’t be in the formulation. Does that mean we may lose on sensory? Probably, but not always. Is this however something that will prevent people from buying your product? Absolutely not! It will all come down to education on how and why you have put together your product this way.
 
Secondly overall experience. It is so easy today to approach a contract manufacturer and get a product developed. Therefore, the biggest impact you could make for a consumer to buy your product is to make this link between the product and the consumer as strong as possible. This should be true throughout all the touchpoints, from brand awareness to product consideration, product purchase and product use. 
 
It could be nice branding, a well thought out website, the right choice of words, a nice display in-store or online, and irreproachable customer service. Most of those are not coming at extra cost, it just requires to spend a lot of brainpower and iterative thinking to come up with the best version of this product on those touchpoints. 
 

5. In your opinion, what areas of the cosmetic industry need the most innovation and redesign?  

The first is IT and information management. We have been operating in an industry that is relatively slow in adopting the latest tools and technologies. This applied to product lifecycle management, product design, safety and regulation, product and consumer feedback tracking etc, … This is very far from the advances of industries such as financial (think fintech) food and beverage, or general retail. 
 
In my opinion, a strong digitization effort is required. This is what my team was doing at COTY as we stepped away from paper, or local records, into cloud-based information management solution. This provided us with clean, structured and more useable data. Since I left COTY, I have been involved in a very smart project in the Good Face Project team, a female-founded tech start-up based in California. Their team is bringing their tech expertise to turbocharge and tidy how cosmetic formulations are made, and how product safety and regulatory assessment are performed. This will not only save the brands and suppliers' time and resources but more importantly, remove the risk of human error. This is what will help provide the best product (actual formulation and service) possible to the most discerning beauty consumers. 

​Canadian Cosmetic Cluster Presents - New Webinar for Startups in the Cosmetic Industry on November 4th 2020 at 10 am Eastern Time Canada/ 4pm European Central Time

The Cluster will talk about how startups fit into the Global Cosmetic Industry and their role in as the future leaders in Beauty. 

Topics That Will Be Discussed
​
Cosmetic Industry Overview
Startup Opportunities in Canada 
Global Startup Opportunities 
How to Save Money in the Startup Phase
Future of Cosmetics and How to Contribute

The Canadian Cosmetic Cluster had the pleasure to visit the Cosmetic Valley in Chartres, France.  The Global Cosmetic Team had a successful meeting and worked on the Cosmetic Rendez-Vous 2020 Presentation.  We look forward to new adventures in the new year. 

This edition of industry voices brings you a closer look at startup skincare brand - Three Ships Beauty.  The Cluster interviewed the founders of Three Ships Beauty, Connie Lo and Laura Burget. Startups are the future of the cosmetic industry. We will be interviewing startups to get a better understanding of their needs, goals and how cosmetic cluster can support them.

 1. Tell me a little bit about your company? Why did you launch a skincare business?

We founded our skincare brand in 2017 after being frustrated with how high-quality natural skincare products cost so much. Both 23 at the time, we decided to create our own business. We scraped together $4,000 and started by making our own handmade formulations in my apartment kitchen. Our goal was to solve the problems we faced as consumers and create the most effective and affordable natural skincare products available. This is why every Three Ships product is made with 100% natural ingredients and is certified cruelty-free. It’s why nothing goes to market unless it has been  scientifically proven to work. And it’s why all of our products will forever be under $40 USD. You can read more about our formulation philosophy here. Since launch, we are now carried in +400 retailers across North America, and have a full product assortment of 16 SKUs.

2. Why did you rebrand NIU BODY with Three Ships Beauty? What does Three Ships mean?

A whole lot of thought and attention went into rebranding from our previous brand NIU BODY to Three Ships. Although we built an amazing brand with NIU BODY, there are some important reasons that led to our decision to change the name. The key one is that we needed a brand name we can have full ownership over, both from a trademark and a consumer clarity perspective. Over time, we had heard that some consumers were confusing NIU BODY with brands spelled similarly, finding NIU BODY difficult to pronounce, or thinking NIU BODY was a body care company. That, together with not having legal access to the trademark for NIU BODY, led to this important decision. 

This change has also further fuelled our focus on transparency and direct messaging. When we started NIU BODY, we assumed our target audience would be young (like we were), particularly given the affordable price point. With that in mind, we developed a brand that was young and cheeky. What we have learned over the past 3 years, is that the majority of our customers are actually slightly older and prefer more direct and transparent messaging. As a result, we’re adjusting our brand messaging to emphasize transparency and ingredient education, and pairing it with more natural looking (yet still vibrant!) packaging design. The name Three Ships™ for us is significant. We stumbled upon the story of the Fountain of Youth, and immediately fell in love with its parallel to our brand ethos. For thousands of years, there have been tales of adventurers going to great lengths to find the mystical Fountain of Youth. Some legends even suggest that it was discovered by a very small fleet of three ships. While we know this to be a myth, great discoveries can still be made with limited resources. We embrace this less is more mindset and use this philosophy to chart our course as a company. We believe you don’t need a long list of unnecessary ingredients in your skincare products, and you don’t need a 12 step skincare routine to achieve beautiful results.

3. How do you see your company fitting into the global cosmetic industry? Do you have plans to go global?

We definitely have international expansion in our long-term plans! The need for more affordable and trustworthy clean skincare is not only limited to North America. We are so excited to spread the Three Ships love around the world.

4. What are the challenges for a start-up in Canada? What kind of support should there be in Canada for Cosmetic Startups?

The main challenge of having a start-up in Canada is access to capital. In the US, we have found that there are far more options for private funding and founders there are encouraged to seek external capital. In Canada, the options are much more limited. There are fewer private angel networks, less family offices and fewer venture capital funds. 
It would be wonderful to have more resources available about capital and fundraising for Canadian startups of all kinds, not just in the beauty industry. 

5. How important is research and statistics to your company? Do you have a particular industry source you like?

Research and statistics is very important for us, especially when it comes to our product formulations. In the case of formulating we rely on research studies (both in vivo and in vitro) from our raw ingredient suppliers. These studies determine the efficacy of products which is an area that we care deeply about. 
We also rely on some third part companies for general industry statistics. For example. CrunchBase is a resource that we rely on for fundraising trends within the beauty and DTC spaces. This allows us to have a pulse on the deals that are going on right now so that we can make the best decisions about how to capitalize our business. Beauty Independent and 2PM are two of our top picks for mailing lists to be a part of. They’re great at sharing industry research/analysis specific to the beauty space as well. 

6. Any advice to startups with the process of rebranding? 

Absolutely. Our first critical piece of advice is to clearly define why you are rebranding. Not liking your current packaging is not a sufficient reason for yourself or for your customers. It’s extremely important to explain to your current customers why you are rebranding, and bring them along the journey so they feel heard and included. Second, have a clear idea of what you want the new brand to look/feel/sound like. We established a brand persona (we named her Emily!), and used this persona as a gut check as we worked through all the visual elements of the rebranding. It’s also important to ensure you can trademark your new name, if that is part of your rebrand. Finally, and most importantly, have a detailed communication launch strategy. We established a communication plan for three months out, one month out, and a two-week daily plan leading up to our launch date. This included what we would say, and the visuals, across all channels like email, social media, and communications to stakeholders like investors and retail partners.

7. How important are startups to the Cosmetic industry? 
​
Startups are crucial to the cosmetic industry, as they push established larger brands to constantly innovate and keep a closer relationship with the consumer. Consumers have a voice that deserves to be heard, and it’s often times the smaller indie brands that nurture an authentic connection with their customer. 

Three Ship Founders Laura Burget and Connie Lo.