5 Reasons Black-owned Beauty Brands Fail & How it Stops

Five reasons why Black-owned beauty brands fail and how strategic marketing can help ensure success in the long-run.

The beauty industry is one of the fastest-growing industries in the world, and with the rise of social media, there has never been a better time for small beauty brands to thrive. However, despite the industry's growth, there are still numerous barriers to entry that hinder the success of Black-owned beauty businesses. These barriers include:

1. Limited Access to Funding:

Many Black-owned businesses struggle to secure the funding needed to start or grow their business due to systemic racism and discrimination in the financial industry. Wealth levels for Latinos and African-Americans are reportedly 11 to 16 times lower than for whites which can lead to Black entrepreneurs not being able to self-source capital as they just don't have it.

When it comes to acquiring loans, they are often charged higher interest rates which makes it challenging to keep up with payments as they begin their operations. This can lead to many Black-owned businesses to fail before they even get started.

2. Lack of Representation

The beauty industry has historically been dominated by white-owned businesses and has not always been inclusive of diverse skin tones and hair textures, making it difficult for Black-owned beauty brands to gain traction.

Although there has been efforts made by companies like Ulta, Target, and Sephora that are putting more of an emphasis of showcasing and supporting Black-owned beauty brands, there is still a serious lack of representation amongst their staff and a limited number of Black-owned beauty options in general.

3. Limited Distribution Channels

Black-owned beauty brands may face challenges in securing distribution deals with major retailers or accessing the same distribution channels as larger, established beauty brands. As the owner of Blaq Beaut, I can certainly resonate with this as I aim to partner with a mix of bother larger and smaller Black-owned brands. Between us, I've been told by larger Black-owned beauty companies that our business is "too small" to work with and/or that they want us to purchase over $50k per year from them in sales should they work with us. Which is insane, imo.

It's quite frustrating trying to do something for the greater good when your own people limit your opportunity. After all, everyone has to start somewhere!

I am afraid that I am not the only retailer that has faced this challenge.

4. Limited Industry Connections

Black-owned beauty brands may have difficulty networking and building relationships with industry insiders, such as influencers, editors, and buyers, which can limit their exposure and potential for growth.

Many popular influencers expect to receive a pretty penny for their services and have trouble expanding their reach beyond their local network in general.

5. Marketing and Advertising Challenges

As we all know, marketing and advertising is KEY to any businesses' success, irregardless of what that business focuses on. Many Black-owned beauty brands have limited resources to invest in marketing and advertising campaigns, making it difficult to gain visibility and reach their target audience.

One main reason why they have limited resources in this area is because marketing tends to be the most expensive piece of the business puzzle. Beauty companies spent an average of $7.7 billion on advertising in 2022. Some of these channels include Google Ads, PPC Marketing, SEO, Influencer Marketing & Social Media efforts.

Due to the lack of financial resources, this usually tends to be the main reason why many Black-owned beauty companies can't excel.

The Solution

Getting creative with marketing will help Black-owned beauty brands overcome the advertises held against them. In order to do so, companies should focus on these areas:

1. Developing a Strong Brand Identity

2. Identifying and Reaching the Target Audience

3. Creating Effective Marketing Campaigns

4. Building Relationships with Influencers

Blaq Beaut can help these brands define, establish, and implement an effective marketing strategy to help brands increase their visibility, reach their target audience, and ultimately grow their businesses. For smaller beauty brands, mastering these strategies can be a serious game-changer.

Should you own a beauty brand or want to get into the beauty business, consider partnering with us! In our short tenure, we have been able to help quite a few beauty brands significantly improve their brand's positioning and attract more loyal customers via our marketing consulting services.

We are understanding of these barriers to entry and will work with our partners to ensure that they receive the best services while keeping costs/budgets in mind.

Interested in a free consultation? Email info@blaqbeaut.com for more information by clicking the button below.

Want to learn more about what a partnership with us can look like? Visit our partnerships page: https://www.blaqbeaut.com/partnerships for more information!