For e.l.f. Beauty, customer data is the currency of their digital ecosystem

Do you remember the beauty burrito? It was a collaboration between online cosmetics company e.l.f. Beauty and Chipotle Mexican Grill to promote a limited edition beauty kit packaged like a foil-wrapped burrito. Crazy? Not at all. e.l.f. and their agency partners identified an overlapping demographic of beauty kit-users and burrito-eaters, and created a viral social campaign, especially on TikTok.

e.l.f. Beauty was clearly playing a smart digital game, but there’s a lot of strategy — and technology — in the background. We spoke with Chief Digital Officer Ekta Chopra about a transformation which is ongoing.

Four key pillars of transformation

For e.l.f., digital transformation began pre-pandemic, about two-and-a-half years ago. “Sometimes the brand awareness wasn’t there, people didn’t know what e.l.f. stood for, explained Chopra.” (It’s eye, lip, face.) “We wanted to be declarative about what the brand is.” The decision was taken to close down physical stores e.l.f. had opened, and invest the funds in digital instead.

There were four key pillars to e.l.f.’s digital transformation. The first pillar was creating a fully connected digital ecosystem. “From the time the consumer is doing discovery to the time they get into purchasing it, and advocacy and so forth, how do we make sure we create a frictionless consumer journey?” The second pillar was data collection: “How do you harness consumer data and bring it together in one consumer profile?”

Having collected the data, Chopra explained, the third pillar was to offer the consumer a valuable experience in exchange. “Make sure you’re offering an experience that meets their needs, wants and desires.” The fourth pillar, she said, was bringing the experience to life: “So, augmented reality, live selling, engaging in different ways where you can bridge this gap of physical and digital; and ultimately you do this to grow your commerce business.”

While there was digital growth across the board last year, e.l.f. saw triple digit growth. “I think we were really ready to sustain and capitalize on it,” said Chopra. “What’s fueling the growth is data, which is the currency of the digital ecosystem. Without data, you really cannot continue to grow.”

The data strategy

e.l.f.’s approach to collecting customer data pre-dates the recent developments in privacy regulations. “We truly believed that, in order for us to get closer to our consumer, we needed to give them something that was going to be of value — so that was the rewards program. We currently sit at about 2.6 million loyalty members and it’s just growing.” While e.l.f. is compliant with GDPR, CCPA and other regulations, Chopra is quite clear that the intent of the loyalty program is to gather more customer data.

“We also have measurements that tell us that when we use this data and create an experience — is it driving more conversions, is it driving more average order value, are we building longer lifetime customer value, are we seeing a better repeat purchase rate?” Chopra said.

Stitching the customer ID

The time came — about a year and a half ago, in Chopra’s recollection — when the connected digital ecosystem was in place, large volumes of data were being gathered, and e.l.f. faced the challenge of pulling the data together and activating it in a range of channels. “All this information was here, but it was not stitched with a single consumer ID,” said Chopra. “That’s when we set out to get a customer data platform, and we selected ActionIQ.”

Chopra set about implementing ActionIQ incrementally, a process which is not yet complete. “We finished phase one which brought in almost 75% of our data and stitched it into single user IDs; and we’ve connected all the data sources to be able to create segments and use them for real-time marketing. We’ve trained our agencies on it, because that’s who is executing our campaigns.” Some social data still needs to be imported.

In addition to social media, email and text are important channels for e.l.f. “But I would say it’s a holistic approach. There is not one way the consumer wants to be connected, so having a consumer journey which recognizes preferences is better than just judging a channel in a silo.”

Phase two involved creating segments and focusing on the types of marketing e.l.f. wanted to do. “The journey itself is going to be migrated in phase three, because we want to get all the building blocks together.” In the meantime, the journey is being orchestrated through Salesforce Marketing Cloud, informed by ActionIQ data.

It’s not unusual to hear that successful CDP implementations take time. “We have a very agile approach. We selected ActionIQ around October last year, and we launched in March with 75% of the data — which is huge. That doesn’t happen without a solid team. I have an expert CRM analyst, I have a data analyst who understands the digital ecosystem really well, and that paired very nicely with the ActionIQ implementation team. We worked in tandem to make it happen.”

On the social side

As was evident from the beauty burrito campaign, e.l.f. extends itself beyond the more traditional social media platforms. An e.l.f. challenge campaign was the most viral ever on TikTok with 7 billion views. They’ve explored video-sharing social platform Triller, tested ClubHouse, and established a big presence on Twitch. “We’re always seeking out new ways to engage,” said Chopra. “Twitch is a big channel for us, we’re looking. We have three mottoes: have your feet on the ground (focus strengthen your foundations), have your head in the stars (always looking for new opportunities), and move at rapid speed.”

The agile approach is at work here too. e.l.f. is prepared to make small investments in a wide variety of channels, and if the result is engagement, “lean in,” said Chopra. “We don’t wait for a big study; if I see signals, I’m moving in that direction and I’m going to continue to invest.” Currently e.l.f. uses Sprinklr for social media management, and has an integration with ActionIQ underway.

Next steps? “The next evolution is taking the data and starting to enrich it with insights — predictive models and so forth. How do you bring this all together to look at different ways of activating and monetizing this data?”