jdilla.xyz

A taxonomy of the beauty industry

2025-06-17

Two years ago, I left a career as a Big Tech PM to join a scrappy seaweed start up selling novel ingredients into the beauty industry.

In the process, I got a crash course on the beauty industry and the different companies and people that make the products that fill our stores and homes. I’m not going to say it’s inscrutable, but it did take some time to get my head around.

In general, I think people write down stuff like this less than they should. It’s not proprietary, it doesn’t take much time to do, and it can be immensely helpful to people trying to learn a new field.

In this spirit (and because I love taxonomies), here is a simple overview of the different players in the beauty industry, the types of people that work at them, and some notes on what motivates them. I’ve put specific examples of these types of players in parentheses below because it always helps me to be able to match a real example to the type.

Of course this is a simplified view of the industry, ignoring some of the ways that organizations in the space play across these boundaries or some of the other roles involved (e.g., regulatory consultants), but I think it’s useful as an initial primer.

Brands (Drunk Elephant): Brands market and sell products to consumers either directly through their websites or through retailers They can be majors (Estée Lauder) or independent (Dieux). Most brands do not actually manufacture products they sell themselves, but do this through Contract Manufacturers. Many of them also outsource their formulation, either to Contract Manufacturers or Formulators. Brands are motivated to grow revenue and build consumer loyalty by launching distinctive, on-trend products that balance performance, cost, and storytelling.

Retailers (Sephora): Retailers sell products that brands make to consumers. They typically do not make their own products or if they do have their own line, it’s just part of what they carry. They give consumers a central place to browse products across brands and categories and create value through their selection. Retailers aim to maximize sales and customer retention by curating compelling assortments that drive traffic and basket size across multiple brands.


Contract manufacturers / CMs (Allure Beauty Concepts): Contract manufacturers make products on behalf of Brands. They buy ingredients and packaging and then turn those into products that people buy for Brands. They frequently hire cosmetic chemists in house to create formulas for the brands that they work for, but will also take formulas Brands have created themselves or through Custom Formulators. Contract manufacturers are focused on keeping their production lines full and profitable by securing recurring brand partnerships and offering value-added services like formulation.


Formulators / Custom formulators (KKT Labs): Formulators are cosmetic chemists that sell Brands a formula that they can take to a Contract Manufacturer and have that made into a product consumers can buy. They are usually independent consultants, but sometimes small teams. Brands sometimes prefer to work with a Custom Formulator because then they own the formula and can shop it across multiple Contract Manufacturers to try and get a better price (when the CM formulates on behalf of the Brand, it is typical for them to own the formula rather than the Brand). Custom formulators are motivated to build trust and repeat work by offering differentiated formulas and acting as an outsourced R&D partner for brands


Suppliers / Ingredient manufacturers (Mibelle): These companies make ingredients for use in beauty products. They sell to Contract Manufacturers, but have to influence Brands and Custom Formulators in order to drive sales. They typically work with Distributors who represent their products to these different groups. Ingredient suppliers seek to grow sales and adoption by getting their ingredients specified in hero formulas and building trust through efficacy data, claims support, and education.


Distributors (Catalyst Technologies): Distributors sign distribution relationships with Ingredient Suppliers to represent and sell their products to Brands and Contract Manufacturers. They try to have a balanced portfolio of different ingredients that makes them more relevant to a Cosmetic Chemist than any one Ingredient company could be on their own. They act as a salesforce for the Suppliers. Distributors are driven to increase sales across their ingredient portfolio by being a trusted, convenient resource for cosmetic chemists and formulators.

Good tokens 2025-06-14

2025-06-14

Worth your time

  1. How to Live on $432 a month in America
  2. How to read coffee tasting notes
  3. Einstein and relativity. His path of generating the theory stood out to me: in 8 years of thinking about the problem, he cracked it when he signed himself up for a series of lectures where he had to articulate it to others. “Finally, in the week before his last lecture, Einstein cracked it. At the end of the week, he stood up at the Prussian Academy and announced to the world the general theory of relativity he had figured out just days earlier.”
  4. The SCARF Model: Status, Certainty, Autonomy, Relatedness, Fairness

Things I learned

More Romans were killed at Cannae than Americans in Vietnam or British on the first day of the Somme — The Rest is History

Musings

“To create anything worthwhile, you have to put God in it.” — Nabeel Qu

Good tokens 2025-05-27

2025-05-27

Worth your time

  1. People Are Losing Loved Ones to AI-Fueled Spiritual Fantasies and China’s superstition boom.
  2. Using Claude to make weapons of mass destruction.
  3. Slate Truck is a $20,000 American-made electric pickup with no paint, no stereo, and no touchscreen <- I’m very interested in this one, although I’d go with the SUV.
  4. And old post of mine about how recycling in Switzerland works.
  5. SEO for Chatbots. It begins. I guessI shouldn’t look down too much on this.
  6. Sacred vs. secular values. When people see an issue as a moral imperative, asking them to compromise on it with money offends them and makes a compromise less likely. Instead, the key is to offer respect and a compromise on a similarly important issue.
  7. The invention and commercialization of stainless steel.

    Commercial success demanded blending science and marketing; a steelmaker had to recognize not just the value of a new alloy, but its potential use. Benno Strauss, of the Krupp Works, later spoke about recognizing the potential of his stainless steel in plumbing, cutlery, medical equipment, and mirrors. He, like Brearley—who realized his stainless steel would be useful in spindles, pistons, plungers, and valves—was focused.

Things I learned

One step back, two steps forward

“Research on third-grade retention policies [holding kids back in 3rd grade] has found that students who are retained tend to have better long-term outcomes than those who are not” from this article on the Mississippi Miracle.

Trade laws of nature?

The distance elasticity of trade (the rate at which trade between two cities drops off as they get farther away from each other) seems to be the same today as it was in ancient Assyria.

Musings

The fact that exposure therapy works with phobias (e.g., if you’re afraid of airplanes, the cure is actually getting on a plane and seeing that it works out okay) makes me more sympathetic that the idea that one should act brave in order to become brave.

Good tokens 2025-05-16

2025-05-16

New around here

In an attempt to make my writing more LLM friendly I’ve added an llms.txt file and a /llms feature where anyone — you included — can copy ~all of my writing for use in your chatbot of choice. Like most things around here, I built this for myself, but perhaps it will be useful to you too!

Worth your time

  1. Four SeasonsRecomposed by Max Richter. Bewitching.
  2. Slightly rude notes on writing.
  3. How the tomato came to be.
  4. Reforming Naval shipbuilding.
  5. “The key thing to internalise is that the customer does not care about your writing, or about your product. A customer does not buy your product because they like your product. A customer buys your product because they believe it will turn them into a more awesome version of themselves. From Speedrunning the Skill of Demand. I also appreciated the insight that some detachment is needed to make great products. If it’s too personal, you can’t see it clearly.
  6. The best customer lead generation idea ever: personalized samurai swords.
  7. Long live prompt engineering.
  8. Using low roads by Veknkatesh Rao. Via my friend Robinson.
  9. A massive list of pricing tactics. Self reminder to reference this next time I have something I need to price. Via The Browser.

Things I learned

  1. Male snakes have two penises. From Nautilus .
  2. Non-linear ethnic niches: 90% of grocery stores in Detroit are owned by Chaldeans. 95% of Dunkin Donuts stores in the Midwest are owned by Indians, mostly Gujarati Patels. In New England and New York, 60% of Dunkin’ Donuts stores are operated by Portuguese immigrants. 90% of the liquor stores in Baltimore are owned by Koreans. Via Aporia Magazine.

Musings

“Maybe all one can do is hope to end up with the right regrets” — Arthur Miller (via The Browser)