Ever wondered about the ugly side of the beauty industry? Know more about that here!

Tuesday: Return Driven Strategy FROM THE DESK OF MILES EVERSON: Welcome to this week's edition of "Return Driven Strategy (RDS)!" We’re excited to share with you another business case study through the lens of this framework. As someone with over 30 years of experience in business and consulting, I've found RDS to be truly a game-changer in managing my team. Whether in investing or business, this framework involves picking opportunities or actions that offer the best chances for positive returns in a firm. That's why every Tuesday, we publish articles about RDS to empower you as a business leader and manager in today's ever-changing landscape. Let’s dive deeper into the 7th tenet of RDS (Partner Deliberately) in today’s article. Read on to know the importance of choosing the right people to partner with. CEO, MBO Partners Chairman of the Advisory Board, The I Institute

Ever wondered about the ugly side of the beauty industry? Know more about that here! In the exciting beauty world where expressing oneself meets new ideas, the industry is a captivating canvas of colors, textures, and exciting possibilities. From skincare rituals to makeup trends, the beauty industry has become a dynamic realm where artistry converges with science. That’s why as trends come and go, beauty enthusiasts embark on a journey of exploration, seeking products that enhance facial features and tell a story of individuality. This led the beauty industry to become not just about products but also about the relentless pursuit of beauty in all its diverse forms. Here’s the thing: For consumers, embarking into the world of beauty seems simple… but for marketers, it’s not. Think about this: If you’re a marketer, how would you effectively advertise your brand’s products? What would you do to convince your target market that your offering is better compared to other brands? How would you address consumers’ concerns if they want to learn about the latest trends in the beauty industry? One of the ways to do that is through beauty influencers. These “gurus” play a big role in the advertisement and success of various makeup products released to the public. In fact, lots of beauty enthusiasts turn to these gurus and their vlogs for approval on whether or not a makeup product is worth buying. However, there’s more to these influencers than just what they portray while the cameras are rolling. Sometimes, working with people with such a HUGE following can even turn into a nightmare. The Morphe x Jeffree Star Controversy The beauty industry has witnessed numerous collaborations that have shaped trends and defined eras. One of these collaborations was with Morphe… Morphe is a cosmetics brand that gained popularity for its eyeshadow palettes and brushes. The business was founded in 2008 by brother-sister duo Chris and Linda Tawil in Los Angeles, California. Originally, Morphe started as a line of makeup brushes, and eventually expanded its product range to include a variety of cosmetics. Morphe became particularly well-known for its collaborations with popular beauty influencers and makeup artists. One such partnership that stirred both excitement and controversy was the 2020 collaboration with Jeffree Star, an influential beauty guru. This collaboration, while initially successful, eventually became emblematic of the challenges brands face when aligning themselves with controversial figures. Here’s how… Star was known for his makeup artistry and successful cosmetics line, “Beauty Killer,” which was released in 2016. With his popularity being at an all time high back then, he seemed to be a good fit for Morphe's strategy of teaming up with prominent figures in the beauty niche. The collaboration of products, which included eyeshadow palettes and other makeup essentials, generated considerable excitement among fans and followers of both Morphe and Star. Did this sound like the ultimate cosmetics collaboration of 2020? Not really. Amid the collaboration, Star faced criticism for past controversies about him expressing racist comments and displaying poor public behavior. Despite apologies and attempts at redemption, the controversies lingered, casting a shadow over the collaboration. Oh no… Some consumers even questioned Morphe's decision to align itself with an influencer whose actions were deemed offensive by the majority. This then became grounds for the public to turn to social media, announcing the boycott of the brand until these allegations were addressed. As the controversies surrounding Star persisted, Morphe found itself at a crossroads. This led Morphe to announce the discontinuation of its partnership with Star. The decision marked a significant shift in the brand's strategy. More importantly, this signaled Morphe’s desire to distance itself from controversies and prioritize a more inclusive and responsible image. Return Driven Strategy’s (RDS) Tenet 7: Partnering Deliberately In the book, “Driven,” Professor Joel Litman and Dr. Mark L. Frigo talk about the importance of deliberately choosing partners based on an assessment of the benefits brought by each party and how that can help a firm build unique offerings. Professor Litman and Dr. Frigo state that for a business to properly succeed, management needs to know the people who will represent the brand and equally bring a significant amount of assets to the business. Let’s apply that to the case of Morphe and Star’s collaboration… While partnering with a beauty influencer at the time was a testament to Morphe getting the attention of the public, the partnership was still not ideal because Star had a notable negative impact on the brand. Sure, the collaboration undoubtedly boosted sales and increased brand visibility, but it also exposed Morphe to the risks associated with partnering with a controversial figure. In the end, the brand faced a dilemma of weighing the benefits of partnering with a powerful collaborator against the potential harm to reputation due to the influencer's previous actions. — The Morphe collaboration with Star stands as a testament to the complexities of influencer partnerships in the beauty industry. While collaborations can drive sales and elevate a brand's profile, aligning with controversial figures poses risks to reputation and public perception. That’s why it is important for brands to be careful and do thorough research when choosing people to represent them or partner with. They also need to balance being creative and doing business with making ethical choices in an always-changing beauty industry. If you’re looking to gain a better understanding of Return Driven Strategy and Career Driven Strategy, we highly recommend checking out “Driven” by Professor Litman and Dr. Frigo. Click here to get your copy and learn how this framework can help you in your business strategies and ultimately, in ethically maximizing wealth for your firm. Hope you found this week’s insights interesting and helpful.     The Cheesecake Factory is known for its great customer service and extensive menu that caters to every palate. Learn more about what makes The Cheesecake Factory a great company through the lens of RDS in next week’s article!