The Science of Building Great Beauty Brands with Chris Hobson of Rare Beauty Brands

0:00Chris Hobson:Hey guys, welcome back to Skin Anarchy. This is a very, very special episode because we're really going to be diving into the business side of the beauty industry and understanding a lot of the things I think we don't really get to talk a lot about on this podcast, which I wish we had more opportunities like this. So we're going to take full advantage. Without further ado, I'd love to introduce you guys to our guest today. He is truly a, you know, a veteran in the space. He understands the business behind beauty, I think, better than most people that have come on the show. And I'm really excited to kind of pick his brain today.

0:28Chris Hobson:So without further ado, please welcome the CEO of Rare Beauty Brands, Chris Hobson. Welcome, Chris. I'm so excited to host you. Thank you. Great to be here. Thank you for having me. And I hope the business topic isn't too esoteric and nerdy for your listeners. No, I think they'll love it. I think we all love it. Honestly, we have such a cool listenership. And then I always get questions. So you're actually doing me a favor. Okay, great. Great. Perfect. New entrepreneurs that reach out. Well, we'll try and keep it interesting. We'll try and keep it interesting. Absolutely. I'd love to actually start by walking down memory lane.

1:01Chris Hobson:You have such an amazing career. You have literally been building brands since you were 20 years old. And I would love for you to walk us down that memory lane and tell us about your first brand and college and how that turned into a whole career. Well, yeah. It was a brand or a business that I started because I needed money. And so I created this brand called Jonathan Rigby. It doesn't exist anymore. But we made clothing kind of blending. The insight that I had was as a Canadian that we Canadians are sort of products of American culture and British culture. It was the founding of the country, et cetera.

1:39And by the way, it's Canada Day today. So happy Canada Day to everyone.

1:42Chris Hobson:Oh, happy Canada Day. Yeah. So as a Canadian, I kind of had this insight that I wanted to build a brand blending those two things. And as I got into this world of branding and sort of thinking about like what a brand means to people, I just kind of geeked out on it and loved it and loved building my business. And when I graduated from college, I had the Canadian equivalent of a 401k and I got this job offer to go work at Procter & Gamble in brand management. And when I was there, I got exposed to some amazing people. And P &G as a place to work is just a super, super disciplined marketing, just a machine at execution.

2:23And as a brand manager, you get trained as sort of the mini general manager of your brand, of your business. So I learned a ton there. I had the good fortune to work on Scope Mouthwash. And then we launched Folgers Coffee into Canada, which was back when P &G had a food business. And then I went over to the beauty division and I became the brand manager of Old Spice and Secret at the same time. And Secret was the number one brand in female antiperspirants. And it was like rocking and great margins, great business, great advertising. And Old Spice at that time was sort of your grandfather's brand.

2:59and um i had the opportunity to work on we went to the we went to cincinnati where i know you're you're from and we went to the the the u.s brand team and we said hey we're just up here in canada let us use the canadian market as a bit of a test market um and we'll try some different positioning for the old spice brand and then we went and did a ton of research on kind of guys and how they thought about deodorants and and things and we came up with this funny insight into the way that guys thought about it. And that became the repositioning that turned the Old Spice brand around. So we went in, in Canada, we went from number distant number five market share to number three.

3:38By the time I left, I went off to do an MBA. But then that positioning became the repositioning for the brand globally. And now it's, you know, up there with Axe, depending on the year, it's either one or two in market share.

3:51Chris Hobson:Yeah, I remember when Old spice went from like yeah grandpa's brand to like every guy was wearing old spice again like it was really cool to watch you know like oh all of a sudden it re-emerged that's so that's amazing that you had that experience it was really interesting and actually just a few years ago i was reading a marketing book um again i'm a bit of a nerd but like i was reading this marketing book and they were talking about back then if you remember oldsmobile was a car like a car brand and gm was trying to figure out how do we turn this oldsmobile brand around and old spice both have old in their name right and the book was talking about how on the oldsmobile brand they came up with the line it's not your father's oldsmobile and what they by doing that they basically acknowledged it's old-fashioned it's kind of like dated but we're saying it's not dated which is kind of an authentic but also kind of struggling in inauthentic thing to say right yeah and whereas in contrast what we came up with the insight that we came up with was you know, if your girlfriend or your wife ran out of her deodorant or any perspyrin and you were a Gillette guy, she would use it.

4:58No problem. If you were a Menon or a right guard guy, one quick thing, and then she's going straight to the store to replace it. But if you're an old spice guy, no way would she use your, your deodorant. And so we kind of came up with this like funny tongue in cheek positioning of like old spice as like the last bastion of masculinity and like taking guys, taking themselves in a funny way too seriously. And that became the positioning that, again, reinvigorated the brand. But by leaning into an insight from the consumer, as opposed to in the Oldsmobile case, sort of just telling you, hey, we're not old anymore, right?

5:34Chris Hobson:Yeah. No, that's really interesting you say that because honestly, one of my biggest questions I had for you before this interview was talking about this exact idea of like, what does it take to get people to like really hook on to brands like you know you know what i mean like it's like it becomes your tried and true it becomes like your your go-to you know and you even if it is an older brand even if it's like for example like i see this a lot with um you know the ones that have been around like ole and dove like everyone used ole right like our grandmothers were using ole but ole has done this thing where now everyone's still using ole you know and they rebranded and stuff and i'd love for you to kind of share your insights here because i think that's where a lot of the branding stuff gets lost to me.

6:16Chris Hobson:I know as a consumer, and I'm sure if I'm an entrepreneur, it's even more tricky to navigate. Yeah. Yeah. I would say, I mean, I think what, the way you pose the question, you know, what, what gets people to hook onto a brand and make it their go-to. Yeah. I think it's a lot of what you talk about on this podcast outside of the business stuff, right? It's great ingredients. It's proven efficacy. It's, you know, sensorial products that the consumer really loves to use. So I would say at its core, loyalty, retention, all those good metrics that keep people coming back to a brand are mostly driven by product.

6:53And there's differentiation in product quality across the skincare world. So you have to have a great product. That's the core. To me, from a brand perspective, a brand is sort of the embodiment of all the promises that a brand that a product is going to deliver to the consumer. So that's, that's the product, the product quality, the efficacy, all of that. But then there's an emotional aspect when we when we select products, right? You know, there's, there's the logical this has got this much retinol in it, therefore, it's going to do this for my skin. And I can prove that there's the emotional side or the, the less logical side of why people pick products.

7:35And if you think, if you think we're all logical and how we pick products, go look in your garage and all the crap that you've got in your garage. That's been, it's been, you know, um, uh, building up over, over the years. Right. So, so like to me, a brand is, it fundamentally rests on a consumer insight. And so that in the old spice case, there was that insight that we had around guys and women and how they, how they thought about brands and how they thought about deodorant. At Rare Beauty Brands, we have two main brands. We have Patchology, which is a patch-based skincare brand, and we have Kate Somerville, which is a clinic-based skincare brand.

8:18The consumer insights for each of those are very, very different. They both have amazing products, highly sensorial, high repeat rates. They've got the products there, But the insight for a patchology consumer is I want a moment of joy. I want a moment to myself. I want a moment of self-care. The act of putting on the mask or the patches slows me down from my crazy day and I get a moment of joy, right? Right.

8:46Chris Hobson:Yeah. The Kate Somerville consumer, you know, the Kate Somerville clinic comes from West Hollywood. It's a celebrity, you know, clinic, you know, estheticians to the stars. And there what the consumer is buying into is, you know, I know this is going to work because the products are amazing. Like Kate Somerville herself and her team formulated amazing products, super high repeat rates, super high net promoter scores, like all the metrics. right they're just amazing but also you're buying into a little bit of the fact that you know the kate somerville clinic they've been in business 20 years they've had all these a-list celebrities you know they've done 250 000 facials like they've just they've been doing this for years and the products come from all of those hours of hands on touching skin and that insight of of like i want the best i know it's the best because of of this and so when you get that magic of the consumer insight married to really high quality product, that's the foundation of a brand.

9:48Chris Hobson:I love that. And I could not agree more with you because I'm very familiar with Kate Somerville's brand. I got to interview Kate and I was like literally raving the whole time I got to interview her because I loved the brand for so many years. And it really does matter. Like I remember back then when I just started the podcast as a consumer of her brand, like that was my feedback, right? It was like, I trust your products. Like I can come to these all the time and it's always going to be the same. And I think so as like a follow up question, like that's really a big one for me. Right. It's like, where do you as a brand make that decision of like, we need to change things up to get more people versus no, we need to stick to our guns and we need to really figure out what's going to bring our consumers back.

10:29Chris Hobson:Like, I would love your thoughts on that. Yeah, no, that's it's a it's a fair point. And it's a little bit the 64 million dollar question of brand marketing. Right. Because many brands start with a core insight and a core positioning. And then brands change hands. They get bought and sold. Different investors come in. Different managers come in. Different CEOs come in. And everybody wants to put their imprint on a brand. I'd say where – so that's just natural. That's just part of the natural evolution. And we all, as businesses, we all want to grow our businesses, right? So like we're always looking for the next way to grow.

11:08And I think one of the one of the false paths that brands go down is they start trend chasing and launching new skews for news because that may not be tight to the original conception of the brand, the original positioning of the brand. but you know retailer x says well we're having a big thing on you know exosomes you know so you got better launch an exosome product and brands are kind of like i don't know the science is sort of like so suspect but like hey it's a 10 million dollar opportunity like how do we not do it right and so i think the the and it's hard and and i i would say we're not perfect at you know only staying true to the original strategic vision because you got to grow the business and i think that's the central tension of trying to do things that are responsive to the market and responsive to trends, but doing it in a way that's very authentic to the brand.

12:04And where brands lose it is where they just go wholesale trend focused and forget about doing it in a way like there's probably, I haven't actually studied this, but on exosomes, because I just randomly threw it out, there's probably a Kate Somerville way to do exosomes that could be figured out. But I don't know what that is yet. But like we wouldn't just do it the way anybody else is doing it, if that makes sense.

12:26Chris Hobson:That does make sense. Yeah. And I'm glad you actually used that example, honestly, because that is something like I'm seeing as a scientist. I see this every day in the skincare space right now, especially more than ever, I feel like, is this idea of like not only trend chasing, but science chasing. And it's like that's fine to do. Like that's how science grows as a multidisciplinary field. But like at the same time, we have no idea how some of this stuff works. And I say this to brands all the time. And honestly, that's like part of why I asked you that question, because it's like as a brand, if you're like a founder and you don't have a background in something, but you're putting your name on it, right?

13:03Chris Hobson:And you're trusting the market and you're saying, this is where it's going. I'm going to keep following it and hopefully it'll come out, you know, other end. Where do you have to make that decision between like, okay, you know, I can do this up to this degree and this is my limit, you know, and then after that, I'm going to let the trend go and run its course, whether I'm on it or not, you know, that kind of thing. Yeah. I'm not sure this ties to trend per se, but I did face exactly this, this challenge when I was launching the Patchology brand of the fact that we don't, we, we collectively as, as the, the, the whole community don't know how some of these things work.

13:40So the backdrop on Patchology is It was a MIT technology that was spun out that was able to push ingredients through the skin in higher quantities than topical application or traditional patches. And the original application was medical. Like we did an estrogen patch and a pain patch and did all these like medical patches. Or I shouldn't say we because it predated me getting involved in the business. But then they had this insight that there were all these great ingredients in skin care. And wouldn't it be great to do skincare patches and be able to push your traditional vitamin A, vitamin C, et cetera, ingredients through your peptides, your, you know, hyaluronic, all the, you know, the entire skin pyramid.

14:21Like, could you create a brand around pushing these ingredients across? And we did. We tested, you know, topical application of hyaluronic versus our patch. And we got orders of magnitude more penetration deeper into the stratum corneum than topical. We did it for peptides. We did it for vitamin C. We just did it across the board. And I could say, like with absolute scientific certainty, and by the way, I'm not a scientist. I just play one on TV, but we had scientists that were doing this. And I could say, like, we get orders of magnitude more hyaluronic through the skin, obviously off of a very small base because not very much hyaluronic penetrates anyway, right?

15:02But we were able to get it through the skin. and and and the the challenge was then i would go to the ingredient manufacturers and i'd say okay you know you've you've done your clinical testing you you've proven out that you know if you can get this this this ingredient on the skin it does well what if i give you 20 times more yeah and it go and it goes deeper into the skin and they would just be sort of like i don't know we haven't really studied that right or we don't really know we don't really know how much a higher concentration within this layer of the stratum corneum or even down deeper like we don't know what'll happen and i was like oh wow so here we are chasing scientific certainty with this patchology brand of like we can deliver more and more more more of the ingredients deeper into the skin and the people making the ingredients don't even know how much that's going to have an impact right And so where I netted out from a marketing perspective was listening to the consumer.

15:59And, and, you know, in the early days, I would go to salons with the, with the, with the patches. And I would, as women were getting their, their foils where they were getting their hair, hair color done, they're just sitting there. And I would say, I would, I would prearrange this with the salons, but you know, Hey, can I give you a free treatment of, of our patches? And I would talk to them a little bit about it. and um while they're sitting there because i was sort of a captive audience and i would i would try not to bore them too much and and we would have this conversation and and i just kind of got this insight that like their eyes started glazing over when i started talking about 10 times more ingredient delivery yeah but when we but when the when they took the patches off and they saw the results they were like oh my god this is amazing right and so it kind of the insight to me was like in the marketing of the patches of any brand, you got to focus on the benefit.

16:52If you focus so much on the RTB or the reason to believe, which is what the whole conception of patchology was the RTB is deeper penetration of the ingredients, more ingredient delivery, therefore better results. Turns out all she cares about is the better results, right? And so like, we just really had to like move ourselves away from that. And then when we elevated from the better results as the functional benefit up to moments of joy as the emotional benefit, the brand just took off.

17:20Chris Hobson:So, yeah. So that's the tension there between the science. The science does matter and it has to be right. But consumers want results and they want a connection. Yeah. That makes so much sense, honestly. And, you know, I think about this a lot because right now more than ever, and I'm sure you've seen this, there's a lot of like niche, like super niche indie brands coming out that are like hyper-focused and it's beautiful because their science is legit and they really have found something wonderful but at the same time I wonder how often they run into this wall of like okay I know I have an audience that audience has bought my product they might even be repeat customers but now I'm at a wall you know what I mean and now I need to figure out how to take the same enthusiasm here and push it out to the mass public and figure out how to make my beauty brand a big household name.

18:08Chris Hobson:And I'd love for you to like kind of walk through that in terms of like that whole transition for an entrepreneur of trying to really scale a brand that might feel very niche when it starts. Yeah. Well, and that journey has changed quite a bit over the last, call it 15 years. And right now we're living in what I would call as a little bit of a back to the future kind of moment where back in my PNG days, there was TV and there was billboards and there was like, you know, magazine advertising, and that was kind of how you connected with consumers and you shot one TV ad a year. And that was kind of it.

18:43Right. Then along comes the internet and social media, and we all know the story. And now there's just immense amounts of content. And I can put out a piece of content every second, and it'll get consumed by some algorithm and or some person. Yeah, you know, it's just like a constant thing. And what we've kind of lived through as, um, as that transition was happening, it was very inexpensive to connect with consumers at scale. And so you saw the rise of a lot of direct to consumer brands or social media driven brands, Glossier, you know, you know, the brands and, or a ton of Amazon brands that were just really good at doing the math of gaming, the algorithms to accelerate brand growth.

19:26Um, Um, now all the brands, including the incumbent brands, the legacy brands are all spending money on Tik TOK and social, you know, all the other socials and all the search platforms, et cetera. And so the advertising prices have come up and the ROI has come down. And so it's harder for young brands to, to make that leap. Right. And nowadays, like in, in 2026, probably for the last three or four years, it's been really, really difficult for indie brands to, to do that. And so I think we're going back to a mode where, you know, it takes 15 to 20 years to establish a brand, right? It just does, right?

20:07And then for a brief moment during the social media and search engine craze, it took two years to do that, right? It took two years to have a brand that just skyrocketed. And I think now that it's so expensive on those platforms, we're going back to it takes years. It takes decades to build a brand, which I think is actually healthier because if you look at your local Ulta or your local Target or your local CVS, there's just – and let alone what's on the virtual shelves at Amazon, right? There's just so many brands. and and like ultimately the consumer is now curating back pairing back to you know the trusted brands um yeah so yeah and so i think i think it's going to be harder than ever for brands to scale so in the context of what you're saying like you might have a loyal following here right how do we do this a lot of it is like you got to raise a lot of money people come to me with early stage brands and i'm like you got to be prepared to raise 10 to 20 million dollars at least and spend 10 to 20 years on it like that's the new reality wow that's that really

21:18Chris Hobson:puts it into perspective i'm glad you brought the timeline because yeah like that was a big thing i know like even a year ago i just saw a bunch of brands pop out in the beauty space i don't know if maybe because i'm new to the beauty industry and you know like it's only been six years for me where i've been interacting with it but i all of a sudden it was like a surge and i was like Like, guys, this is not a quick make a buck kind of thing. You know what I mean? Every founder I've spoken to is like knee deep into it, spent, you know, decades building there. And so, yeah, that's interesting that you say that because.

21:48Well, and there are, there are a few, sorry, I didn't mean to interrupt you, but there are a few that do shoot the moon. And like in two years, they create like hundreds of millions of dollars of value for their investors and them themselves. And that probably is the thing that brings all the more entrepreneurs in to chase the dream. but i think those are going to be fewer and far between now um just because it's harder to scale

22:09Chris Hobson:quickly yeah and it's like really redundant like that's another thing and i and i really would love for you to speak on this because for me i've been using for example patchology i've been using it for years oh thank you for years love the brand have always loved the brand and i know everybody went on a craze of like under eye patches here recently like last two three years they blew up you know hayley beaver i think made to go super viral yeah the road and but my thing is and i'm being very very honest when i say this i still buy a patchology i really because the name speaks to me you know because it's like you think of under eye patches the psychology connects you know with the name and i don't know and they work i mean that's the bottom line but yeah i would love your insight on this because it's like i feel like in the world of dupes we're living in the era of dupes everybody's duping everybody but at the end of the day like what is it that you think is going to make a brand truly stay within their category and stay there for many, many years to come.

23:07Chris Hobson:Yeah. Well, again, it continues to come back to that product quality that we talked about earlier, and then that brand connection, that ownership of the equity around the use case. So we don't own it, but we are one of the leaders in that space of joy, self-care, ritual moment for yourself. and the brand has been standing for that for years. But to your point, it's actually a question my early stage investors when we were launching Patchology asked me. They had invested in this transdermal patch R &D company and the whole idea was to do a bunch of patented products that would then get approved by the FDA and then you just milk the revenue stream over the years while you own the patent on it.

23:52And that's the kind of investment model that they had. And they sort of said on, you know, as we go into beauty, A, they didn't know about that, this industry. And, you know, they were kind of like, well, if we don't patent all these things, then, you know, other people are going to copy us. And I was like, yes, yes. Like the answer is yes, we will be copied and we'll be copied over and over and over again. But two things. One, when, and this was 15 years ago, so I wouldn't have conceptualized that there would be a road patch at some point at that then. But like when somebody, when a road copies us, a rising tide lifts all boats, right?

24:31If we own the, if we own the space, you know, we're our SEO, our search engine optimization is, is best in class. You know, we're on the shelves, you know, in the patch areas in the various retailers, like when, when that goes viral. And again, we weren't even talking about viral 15 years ago. Right. But like when that happens, we're going to see an upsurge in business. And we have like our business is up this year, we're going to be up over 20%. Last year, we had a very, very strong year as well. And the brand is fairly large now. And for it to continuing to grow at these rates, at the size that it's at, is testament to kind of the foundation that we've built, but also this notion that the rising tide lifts all boats, right?

25:12Things go viral, we benefit indirectly from it.

25:15Chris Hobson:that's really cool like and i i love that concept because honestly at the end of the day like that's kind of how i as a consumer view dupes too they actually bring my like thought right back to that product like the category and then i start looking for like who's the oldest brand in this category because again it's what we you were talking about earlier it's like who can i trust who can i come to if i want to try this kind of product out you know yeah exactly now i mean and and i think there's a delta in price at which you're willing to be loyal to the old product, right? And so if somebody comes in with, you know, our patches sell at about$1 to$1.50 per use when you buy them in the large size, if somebody comes in with a two cent patch, okay, we're going to probably lose market share to the two cent patch, right?