Beauty Research Looks Good to Website Business

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Beauty Research Looks Good to Website Business
CEO Emrah Kovacoglu with promotional items for a project at Total Beauty’s Santa Monica headquarters.

Thousands of consumers have posted product reviews on TotalBeauty.com about everything from the best blush to worst shampoo.

Total Beauty Media Inc., the Santa Monica company that operates the website, thinks health and beauty product makers would be interested in what those consumers have to say. So it has started posting research reports based on those reviews.

The company’s first study came out in December, detailing how women choose which perfume to buy. And last week, Total Beauty published the first edition of its main product: research on what influences consumers’ beauty-buying decisions.

Emrah Kovacoglu, the company’s chief executive, said the research reports help the website garner credibility in the beauty industry.

“There isn’t one brand that owns beauty from a consumer and advertiser perspective,” Kovacoglu said. “We want to establish ourselves as an authority in the space.”

The goal is to get recognition from beauty product manufacturers so that when they want market research, they’ll commission it from Total Beauty.

Kovacoglu co-founded the company in 2007. It operates four lifestyle websites focused on health and beauty. The sites offer a mix of articles, how-to guides and expert tips written by Total Beauty’s editorial staff and consumer reviews for a variety of products.

The company doesn’t sell the packaged goods that it reviews. Instead, it makes the majority of its money through advertising and sponsored articles.

Kovacoglu would not disclose the private company’s financials, but said advertising makes up about 90 percent of revenue. The company has around 40 employees and is headquartered near the beach. The websites have a combined audience of more than 12 million each month.

Total Beauty is part of a wave of new-media websites that provide a mix of how-to articles and expert tips, including Demand Media Inc. in Santa Monica that operates a number of sites including beauty site TypeF.com.

Rebecca Lieb, an analyst with Altimeter Group in New York, said websites like TotalBeauty.com and TypeF.com are now competing to fill a role that magazines such as Cosmopolitan and Glamour have long held.

“Sites like this are doing what magazines have done for decades,” she said. “They create a consumer lifestyle environment that serves a stated purpose and contextualizes advertising.”

The mix of editorial content and consumer reviews sets Total Beauty apart from other beauty websites, said Krista Garcia, an analyst with eMarketer in New York. She said such sites as Total Beauty are becoming more popular with consumers.

“There’s just too much information out there,” Garcia said. “People want to have more than just products presented to them. They want to have some sort of editorial voice that comes along with it.”

Industry research

So why the jump from product reviews to market research?

Kovacoglu, who previously worked in marketing for Cincinnati packaged goods conglomerate Procter & Gamble, said he discovered a few years ago that he could turn customer reviews into information that beauty companies would be willing to buy.

“What we realized is that we have a ton of users across thousands of brands and dozens of categories,” he said. “It’s a wealth of information that we can gather.”

Total Beauty began conducting sample surveys for companies by offering consumers free product samples in exchange for their response to questions about the product. It also worked on other commissioned research projects.

For example, when Oldsmar, Fla., hair care company Samy Co. wanted to change the packaging for its shampoos, conditioners and other products in 2009, it hired Total Beauty to research what customers wanted. It turned out customers liked the products’ bright colors but found the labeling confusing.

Roger Salazar, the former head of marketing for Samy who is now a beauty industry consultant, said Total Beauty’s research saved the company money it would have spent changing packages.

“Total Beauty helped me report back to the management team not to do the major facelift,” Salazar said. “That translated into tens of thousands of saved revenue for not having gone down that route.”

Although Salazar could have used any number of market research firms for the project, he said he hired Total Beauty because it focuses specifically on his industry.

Until now, the company has focused on its editorial content and consumer reviews, with less emphasis on research. Kovacoglu said he wants to expand Total Beauty’s research business by posting its industry research reports. The company will release several reports on different topics this year and complete frequent updates on its primary report, “Get Added to the Shopping Cart.”

The reports are free to download from Total Beauty’s website. Kovacoglu said he hopes those reports will entice beauty product companies to then commission more in-depth research, which costs between $25,000 and $350,000, like the type it did for Samy.

But Altimeter’s Lieb noted that health and beauty companies already have many choices on where to go for market research.

“Becoming the undisputed expert in a space as crowded as beauty is a very ambitious goal,” she said. “I don’t know that there ever will be one expert.”

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