With limited resources e.l.f. a cosmetics company built a tremendous following and strong revenues by using only new media. They spend no money on traditional media. We at Rain are using Social Media everyday to create opportunities for our clients, and are fascinated by the strategies of e.l.f. CMO Ted Rubin. Read on………
How e.l.f. Became a Social Media Giant
Feb 9, 2010
– Todd Wasserman
Few brands have had as singular a focus on social media as e.l.f., a cosmetics line that does zero in the way of traditional advertising yet has strong working relationships with about 500 bloggers. As the CMO for e.l.f. (the acronym stands for Eyes Lips Face), Ted Rubin is known for his active use of Twitter (where he has 20,000 followers) and his responsiveness. Rubin, a former protege of Seth Godin, says he responds to every tweet he gets. The social media outreach, along with distribution at Target, a recession-friendly price of $1 per item and a positive review in O: The Oprah Magazine two years ago have helped e.l.f. build a strong brand on the cheap. Brandweek spoke with Rubin about his thoughts on traditional advertising, social media and why larger brands like Coca-Cola can benefit from e.l.f’.’s strategy. Excerpts from the interview appear below:
Brandweek: Your philosophy is not to spend any money on traditional media, right?
Ted Rubin: It’s more than a philosophy, it’s part of our business model and part of what allows us to sell products at the prices we do. So it’s not just a philosophy and the reason I point that out is I work with a lot of bloggers and as bloggers are getting more sophisticated and are earning money from certain brands, they come to me for sponsorships and things and I can legitimately tell them that I can’t do it. It’s not that we don’t want to do it or we don’t want to spend the money there, it’s just not the way we operate.
BW: We’ve seen companies like Google and Starbucks that never advertised suddenly advertise. Do you see that happening at e.l.f.?
TR: It’s hard to say. I believe at some point it will have to change, but I believe that the founders—and take this in the most positive light—are very spoiled. They got success from day one and they’re very used to things working right away. So they’re not used to putting in money to make things work, but if you want to grow and expand past a certain point there are chances that you have to take and that could mean trying out traditional ads.
BW: Regarding social media, is most of your focus on Twitter or is it Facebook?
TR: My philosophy is that Twitter and Facebook are what leads into other forms of social sharing. I consider Twitter a place to lay the groundwork where other people pick up things. I make a great use of Twitter and Facebook not only to reach out to the public, but to build relationships with stronger mediums, like the blogging community. We have 500 bloggers that I deal with regularly that are on my list regularly to contact about products, about changes, about updates and they’re not like an e-mail list that you’d get on if you sign up with e.l.f. With the bloggers, it’s a much more direct relationship. I focus on Twitter and Facebook because they’re scalable platforms, but I do that to build up what I feel are the real advocacy groups which are the bloggers and the people on YouTube.
BW: How much of this is CRM and how much is marketing?
TR: Personally, I believe CRM and marketing go hand in hand and I believe it is a problem in a lot of corporations. I think customer service should come under that realm as well. In a company where customer service doesn’t come under the CMO or at the very least if there’s not somebody in charge of customer service who’s not working hand in hand with them is a big disconnect, because if you’re saying one thing in, especially in social media marketing and they’re experiencing something else, there’s going to be a problem.
BW: How did you amass such a big Twitter following? You have more than any other CMO, including Barry Judge of Best Buy or Jeffrey Hayzlett of Kodak.
TR: What’s nice about that is it’s helped me build relationships with them as well. Being a small brand, I now have relationships not only with all the guys on that list but with others who have recognized what I’m doing there…I think it’s a lot about my personal branding. I reach out a lot, I’m incredibly communicative. I don’t just talk about media, I talk about marketing, I talk about being a divorced dad with teenagers. Why do I do that? Because I think the more people get to know you for who you are then you’re not just a guy trying to sell them something and I write about things I believe in. People will realize quickly if you’re writing about something that’s not truly you.
BW: Isn’t the goal to sell more product?
TR: The goal is absolutely to sell more makeup. Our immediate goal within social media is not click-throughs, not like our direct marketing path that we have with our e-mail marketing. Bottom line, e-mail marketing is about click-throughs and open rates and sales. I can’t say that everybody here agrees with me and I think it’s a fight that most CMOs are focusing on social media have with the C-suite, our founders and owners. I think that everyone’s been spoiled in the last 10 years because everything’s so trackable and most of them forget that the way they built their company originally was on branding. Who would buy $1 makeup if there wasn’t a brand attached to it that led them to believe it was quality? If we didn’t have the social media presence where bloggers and tweeters and Facebook people speak about us all the time and literally a day does not go by where there’s not a user-generated, unincentivized video uploaded to YouTube about e.l.f., not a day. I do believe in sales, but there’s not a true device that [tracks the link between] social media and sales that’s really working. Right now, I think the most important thing is engagement and interaction because it allows you to do branding on steroids. Before, branding was putting up a GoDaddy ad on the Super Bowl and following up with a billboard.
BW: Do you think a large brand like, say, Coca-Cola, can learn from what you do?
TR: I think they can totally learn. Coca-Cola could do it much better and it would be easy for them. Look at the amount of people who would love to follow Coke if they were doing something of value and making people feel like they were doing something more than buying a product.