Barry Beck, founder and COO of Bluemercury, discusses the company's origins and growth. He founded Bluemercury in 1999 as a neighborhood beauty store focused on providing expert advice through a team of beauty consultants. Since then, Bluemercury has grown rapidly through additional store openings and an acquisition by Macy's, becoming a leading beauty retailer with over 130 stores across the US. Beck emphasizes the importance of innovation to Bluemercury's continued success, including developing new beauty products, leveraging emerging technologies, and adapting to changes in consumer shopping behaviors.

1. #RIC16
Retail
Disruption
In
Practice:
Brand
Growth
Success
Stories
Barry
Beck,
Founder
and
COO,
Bluemercury

2. CONFIDENTIAL 2
Friendly neighborhood store where you can get expert beauty advice
Bluemercury Today

3. CONFIDENTIAL 3
Our Business Model:
Friendly Neighborhood Store
PERSONAL CURATORS
MOM & POP BUSINESS NEIGHBORHOOD LOCATIONS
SPA SERVICES ASSISTED OPEN SELL
TEAM OF BEAUTY EXPERTS

4. CONFIDENTIAL 4
She looks to Bluemercury for solutions
to her beauty problems

5. The Bluemercury Customer is affluent,
educated, and very busy!
This image cannot
currently be
displayed.
38%
suburban
power-­‐Mom
2.6%
recent
college
grads
in
cities
6.6%
suburban
professional
superwoman
2.5%
urban
family
12%
suburban
empty
nesters
7%
suburban
boomers
2%
urban
boomers
29.3%
urban
professional
superwoman
highly
educated30% $150k+
income 80% professionals
12x annual
visits
(best
clients)

6. 1999The Story of Bluemercury’s Founding

7. CONFIDENTIAL 7
My Partner and Inspiration

8. CONFIDENTIAL 8
“…only department
stores and
drug stores?”
“Books…
Amazon?”
“Shoes…
Zappos?”
A Serial Entrepreneur

9. CONFIDENTIAL 9
The Old Way
DEPARTMENT STORE COSMETICSDRUGSTORE COSMETICS

10. CONFIDENTIAL 10
1999: A Competitor Arrives in Georgetown

11. CONFIDENTIAL 11
Fast Paced Revenue Growth
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
SALE TO MACY’S
$210 MM ALL CASH

12. CONFIDENTIAL 12
2016

13. CONFIDENTIAL 13
Our Innovation Model and
Source of Competitive Advantage
PEOPLE PLACE
PRODUCT

14. CONFIDENTIAL 14
Our Secret Weapon = Our People

15. CONFIDENTIAL 15
Beauty Junkies

16. CONFIDENTIAL 16
How The Bluemercury Customer Shops
She is coming in looking for a
specific brand and/or a product
within that brand
She is looking for a product
with a specific attribute
She has
a general
concern
“Do you carry
………?”
“My skin is dry,
what should I do?”
“I need new
makeup colors
for spring.”
“I need a
sunscreen
with a high
SPF.” “I need a hairspray that
doesn’t feel sticky.”
“Do you have an
eye cream for
dark circles?”

17. Human Googles

18. CONFIDENTIAL 18
240 235
280
548
134
205
232
375
199
359
142
52
# of NEW PRODUCTS
LAUNCHED IN 2015
Why Is Innovation Important?
WINNER TAKES ALL
of new products
launched in
2015 failed
700 -­
600 -­
500 -­
400 -­
300 -­
200 -­
100 -­
0 -­

19. CONFIDENTIAL 19
1999: Beauty Products Innovators
SHISEIDO
LVMH
L’OREAL
LVMH
ESTÉE LAUDER
LVMH
DIEGO DELLA VALLE
JAMI HEIDEGGER
MARCIA KILGORE
MICHAEL GORDON
LEV & ALINA GLASSMAN
FRANCOIS NARS

21. CONFIDENTIAL 21
Product Criteria
ANNUITY SKUS

22. CONFIDENTIAL 22
Product Criteria
LOVE IS ALL WE NEED

23. CONFIDENTIAL 23
Our land
& expand
strategy
WASHINGTON, DC
METRO AREA

24. Flexible Neighborhood Real Estate Model

25. CONFIDENTIAL 25
So what’s next?

26. CONFIDENTIAL 26
What’s extraordinary today
will be ordinary tomorrow.

27. The risk of your business being “Uber-ed”

28. Near-Term Next Generation
Total Disruptive
Innovation

29. 29
Near-Term Innovation

30. 30
Big Data Analysis

31. Next Generation Innovation

32. Automating Hyperpersonalization &
Omnichannel 3.0

33. CONFIDENTIAL 33
Geo-Tracking and Geo-Targeting

34. CONFIDENTIAL 34
Total Disruptive Retail Innovation

35. CONFIDENTIAL 35Source: Gartner
It’s projected that 25 billion connected
things will be in use by the year 2020
(compared to 5 billion in 2015)
SMART
car
SMART
home
SMART
TV
SMART
appliances
SMART
skincare
SMART
makeup…WHAT
ELSE?

36. The Golden Thread to Purchase
TWEET
BLOG ARTICLE
INSTAGRAM
EMAIL CLICK
YOUTUBE VIDEO
STORE CHECK-­IN
PURCHASE

37. CONFIDENTIAL 37
Virtual Reality

38. 3D Printing

39. CONFIDENTIAL 39
Advanced Robotic Delivery Systems

40. CONFIDENTIAL 40
How will the consumer behave in the future?

41. #RIC16