Function of Beauty enters Target in first retail expansion (2022)

Customized hair-care brand Function of Beauty expanded to Target on Sunday, Dec. 13, kicking off a major retail development for the 4-year-old startup.

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Its first permanent foray into brick-and-mortar, Function of Beauty has a one-year exclusive deal with Target to offer its shampoo and conditioner products in-store and on Target.com. Function of Beauty’s DTC business also sells leave-in conditioners, hair serum and a hair mask. To translate its customized products, Target’s endcaps and shelves feature 12-ounce bottles with four base formula options for straight, wavy, curly and coily hair types. Customers can then choose up to three booster packets out of 10 options, based on their desired end result, such as shiny or voluminous hair. After purchase, they can pour the contents into the bottles, which are filled with 11-ounces of base formula. Function of Beauty’s 8-ounce and 16-ounce shampoo and conditioner sets costs $39.99 and $49.99, respectively, on its DTC channel, Target is retailing the products for $28.95.

In order to bring Function of Beauty into Target, the team had to rethink its customization process, as it typically formulates and fulfills its products in-house at company-owned manufacturing facilities. By doing so, it is able to offer trillions of formula possibilities, but at Target, it is only able to offer thousands. When asked if this type of retail setup might negatively affect how people perceive customized products, Lorna Sommerville, Function of Beauty CMO, said that its altered version of products did not dissuade people from customized products during its consumer testing and research.

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“There are some women who were incredibly excited about this retail offering. This presented them the ability to buy it where they buy the rest of their items,” said Sommerville. “But there was another set of people who, when we exposed them to the DTC version and talked about that higher level of customization, were more drawn to that option.”

The same products in Target stores will be available on Target.com. For Target.com sales, customers can opt to experience the fully customized version through a link out to FunctionofBeauty.com. Customers will arrive at a co-branded landing page before taking Function of Beauty’s hair quiz. An undisclosed portion of the sales will be split with Target for these types of purchases. Target has made an aggressive play for adding buzzy DTC brands to its shelves over the last three years. They include Winky Lux, Versed skin care and Flamingo shaving brand, among others.

Target offers a large brand awareness opportunity for Function of Beauty. Notably, this retail partnership quickly follows Function of Beauty’s $150 million Series B raise led by L Catterton in early December. That raise is dedicated to fueling Function of Beauty’s expansion and growth of new products, international markets, hiring and retail partnerships. Function of Beauty recently launched national linear TV ads in January, body care in July and skin care in October.

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Zahir Dossa, Function of Beauty CEO and co-founder, declined to comment directly on a potential IPO, acquisition or alternative exit strategy, only saying that it is “too early to say.”

Beyond Function of Beauty, its direct competitor Prose has flirted with the idea of a retail partner in the past. According to a brand spokesperson, retail was something that was in the pipeline last year, but the brand pivoted its attention due to Covid-19. Exploring a retail presence is not something that is out of the question for the future, but Prose does not have plans to do anything in the retail environment in 2021.

A new customized competitor emerged in April 2020, with the launch of Strands Hair Care. It touts its ability to look at a customer’s hair under a microscope to provide a more precise customized product. Customers purchase a $60 kit and send in a hair sample, and receive an 8-ounce shampoo and conditioner following the hair analysis.

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Dossa declined to specify Function of Beauty’s sales growth or revenue, but Glossy previously reported that the brand has performed well during the pandemic. Overall, the hair-care category saw an 11% year-over-year increase in sales in the third quarter, according to NPD Group data.

“As Function of Beauty continues to grow, this will just be just a preview of what people will think of when they think of hair care and, specifically, [customized] beauty in the years to come,” said Dossa.

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