Chief Marketing Officer Kory Marchisotto joins The Current Podcast to discuss why the makeup brand e.l.f. Beauty decided to air a Super Bowl ad, and why other female-driven brands are missing out.

Episode Transcript

Please note, this transcript  may contain minor inconsistencies compared to the episode audio.

[00:00:00 ] Damian: I'm Damian Fowler.

[00:00:01 ] Ilyse: And I'm Ilyse Liffreing

[00:00:02 ] Damian: welcome to this edition of The Current Podcast.

[00:00:05 ] Ilyse: This week, we're delighted to talk with Kory Marchisotto, the Chief Marketing Officer at e.l.f. Beauty.

[00:00:11 ] Damian: Now maybe I'm the only one here, but I didn't realize that the word elf stands for eyes, lips and face. The brand was launched in 2004 and it filled a gap in the marketplace for inexpensive, high quality cosmetics. 

[00:00:26 ] Ilyse: Twenty years later, and e.l.f. has become a powerhouse brand. It went public in 2016, and since then has seen spectacular growth. Its sales soared last year, driven by retail channels and some seriously buzzy marketing.

[00:00:42 ] Damian: We started by asking Kory, what gives the e.l.f. brand the edge in this very competitive marketplace?

[00:00:50 ] Damian: So Kory, how do you think of the e.l.f. brand in this very competitive field? And what's your competitive advantage as it were?

[00:00:58 ] Kory: I like to think about [00:01:00 ] e.l.f. as a brand of the people, by the people, for the people, created with the people. And for that to be true, we need to be totally in tune and have our finger on the pulse of what the people want, what they like, what are their unique needs, wants, and desires. So we really think about ourselves as stewards of our community's vision of e.l.f.

[00:01:22 ] And that's a very unique place to be standing. How much value and emphasis we put on that community. They're, citizens of the brand. They have a vote, they have a seat at every table, and that is by definition, a very unique competitive advantage.,

[00:01:41 ] Damian: speaking of competitive advantage, you've had tremendous, stupendous growth over the last five years. And I'm just curious to hear from you, what is supercharging this?

[00:01:51 ] Kory: Over the last five years, we've grown our stock price. 1, 567 percent to be exact, [00:02:00 ] making us the number one performing stock on the New York Stock Exchange out of 1, 600. and 15 companies. So I think that definitely deserves your tremendous stupendous.

[00:02:11 ] Damian: Okay, that's good. That's good. And what do you think, if you had to put your finger on two or three factors, what is it that is driving this upward, curve, as it were?

[00:02:24 ] Kory: There's quite a few things and in the essence of time, I'll distill it to the three I think are most important. But for your audience, I think it's really important to go back to the beginning to understand the ethos of the brand, because it's the ethos that powers the purpose that powers the people, That power the performance.

[00:02:42 ] So if you go back to the origins of elf in 2004, let's remember at this time Facebook hadn't launched yet. iPhones don't exist. Imagine this. Can you wrap your heads around that?

[00:02:56 ] And So so we're back in the dark ages folks [00:03:00 ] and our founders dreamt up the impossible and made it happen. So they had this crazy idea that they could create premium quality cosmetics And sell it for one dollar over the internet.

[00:03:13 ] So everybody told them, first and foremost, you cannot create premium quality cosmetics and sell it for a dollar. That's impossible. Second, you certainly can't sell color cosmetics over the internet. And third, even if you figure it out how to do number one and number two, you'll never make this a profitable business.

[00:03:30 ] And aren't we glad that our founders disrupted from day one. So they have this renegade spirit, this bias for action, this quest to do the impossible.

[00:03:42 ] One is our core value proposition, our very unique ability to deliver premium quality cosmetics at a jaw dropping value. The second is our powerhouse innovation,

[00:03:55 ] And then the third is our disruptive marketing engine.

[00:03:58 ] So our core value, [00:04:00 ] proposition, our powerhouse innovation and our disruptive marketing engine are definitely the drivers of our last 20 consecutive quarters of growth.

[00:04:08 ]

[00:04:09 ] Ilyse: I'm curious about your out of box marketing because you guys are known for that. You really are. how did you cultivate this approach when you came on board as cMO?

[00:04:20 ] Kory: at that time, there were some major shifts happening in the company.

[00:04:25 ] So, Every company goes through various stages of growth, especially in a 20 year history. And the stage that I had walked into was a transformation from investing in retail. into marketing. marketing and digital, so when I started the company in at the onset of 2019, we were investing 7%. Of net sales into marketing and digital. Fast forward. We are now up to 24%. So you can see that there's a big investment in the power of the brand and building brand equity and building Brand [00:05:00 ] evangelism and all the things that we've been able to do over time.

[00:05:02 ] So we see that as an enormous responsibility to make their time worthwhile.

[00:05:08 ] It's interesting you call yourself an entertainment company. Or you see yourself as an entertainment company. And I would assume like The new digital channels that you play in have really helped you become such a company in this day and age, especially if you're selling something to consumers online, in stores, etc. To extent would you say digital channels have really opened up these possibilities to you? And I guess, channels do you like playing in the best?

[00:05:45 ] We love all our channels equally, right? It's like our children. We love all our products. We love all our channels. I see all of our channels as learning opportunities. And the most important thing to remember is that they're all there to teach you [00:06:00 ] something different. And even if it's the same person who's coming to see you on Instagram and TikTok, they're actually on each platform for a different reason. So it's critical that we understand what is unique about the platform itself and what is unique about the reason that the person is coming to the platform. And that gives us a unique set of experiences and learnings.

[00:06:26 ] So I think you see the pattern here that every time. We enter into a new platform. We go in with a beginner's mindset. We ask ourselves, how do we create something that is going to add a tremendous amount of value to the people that are here on the platform at the intersection of what it is that we do great. So it's really always this trifecta of beauty, culture, and entertainment. And we're bringing the best of all three to the communities on each platform.

[00:06:56 ] Obviously you're known for your social media strategy, like [00:07:00 ] with this partnership with Liquid Death, but this year you also ran a national Super Bowl ad for the first time, which is always exciting for the first time for a brand. this one featured Judge Judy and cast members from Suits. So a little nostalgic on one hand. Can you talk about the strategy here? You obviously went into the humor category. What was the thinking behind this Super Bowl ad?

[00:07:27 ] So there's this big conversation in the beauty space about dupes and your audience can't see me, but I'm making quotes because that has really ignited this entire conversation about people talking to each other about judging for all sorts of things in, the beauty space. So we started to see this conversation really take off, especially around price and people judging each other for, paying for overpriced makeup. So then we looked at what was happening in culture and [00:08:00 ] entertainment, and there was courtroom drama taking off everywhere.

[00:08:03 ] Suits had its best year of viewership. Judge Judy was the number one program on Amazon Freeview. You had all things happening with Ronald from jury duty. so it was just this incredible cultural moment of all this courtroom drama coming together. And we said, well, that's pretty outstanding.

[00:08:23 ] There's a lot of drama about judging and makeup injustice happening in the beauty world, and there's this incredible moment of courtroom drama happening over here. So once we tuned into both of those things, then we said, Okay, now let's put our head in the

[00:08:38 ] stars and dream what could be possible. And only e.l.f. could dream big enough to say, what if we actually got the cast of suits? What if we actually went and got them? Judge Judy, what if we actually went and got Ronald and put him in our jury box? And these are really big lofty dreams, and that's how we love to operate at e.l.f.

[00:08:59 ] [00:09:00 ] So that was our first national spot, which we decided to do after we tested the year prior with a regional spot. And when we had done the regional spot the year prior, it had broken every record we could have ever imagined, which was the signal that we needed to tell us to lean in even harder.

[00:09:23 ] Ilyse: And if I'm not mistaken, that one also had some star power in it with Jennifer Coolidge. One of my favorite actresses

[00:09:31 ] Kory: major stars of that campaign, Jennifer Coolidge and Power Grip Primer.

[00:09:36 ] Ilyse: Yeah. What did you guys learn from the regional ad, specifically, if there are any lessons?

[00:09:41 ] Kory: So we had never done a TV spot before at that time. So to your earlier point, we grew up in digital or a digital native brand. When we started to invest larger dollars into marketing and digital, we expanded all