How to Validate a Cosmetic Product Idea
Aug 10, 2021 · 4 min read
You’ve been working really hard on your idea for a new cosmetic product, and maybe you’ve even gotten as far as market research, product testing, and benchmarking. But how do you know if your product is going to be possible to produce at any kind of volume?
And if your product idea can be produced—within your budget and according to your timeline—how do you know if people will want to buy it?
The Missing Link in Cosmetic Product Development
Most cosmetic product developers take a long time trying to figure out what product they should develop. As they should, as there’s a whole lot to consider when developing a new cosmetic product, including:
- Which product or cosmetic category to develop (ie. skincare, haircare, etc.)
- Which ingredients should be used
- How the product should be packaged
- What the positioning and the SRP (suggested retail price) should be
These are all questions they should be asking and answering. But once they’ve solidified their idea and written up their product brief, there’s another step a cosmetic product developer needs to take before pushing the project forward—and it’s one that too many overlook. They need to validate their idea.
Basically, they need to figure out if the product should go into production at all.
Three Steps to Cosmetic Product Validation
A lot of cosmetics developers—and especially first-time product creators, fixate on the wrong things, like what color the packaging should be or what the logo should look like. Other developers, even experienced ones, might forget or just gloss over certain aspects that can actually make or break a product launch plan.
So how do you shift that? By adding these three important steps to your cosmetic product development plan:
- Consider the market
- Talk to a formulator or new product developer
- Get quotes from suppliers and product developers
Step #1: Consider the Market
When cosmetic product creators first put their minds to developing a new product, very often they focus too narrowly on the product features. Sure, that might be the fun part, but they also need to do their homework when it comes to ICP. (If you’re a creator and you don’t know what ICP is, then you really need to keep reading!)
ICP stands for Ideal Customer Profile—a sketch of what type of consumer is going to buy your product. You really need to think about how your product is going to address a pressing need for your ideal customer—and then you can start to understand the sales channels you’ll need to go after.
By putting the focus on market, rather than on product, you can really put your new product in context, and understand who their customers are, what they want/need, and how to reach them. This understanding is crucial to validating a product idea.
Here are four research tips for understanding your market:
- Visit online and retail stores and survey the brands and the products on sale that are similar to yours.
- Are they all big names and products from legacy companies? Or are there also smaller, indie brands?
- You’ll be able to infer a lot about how much marketing budget you’ll need and manufacturing volumes you’ll have to produce (whether that’s a lot or a little) by studying the other brands in stores.
- Talk to salespeople and store owners and find out what sells.
- Use your shopping trips for market research and ask questions about products that are similar to your idea.
- You can glean a lot of information about what sells in their store and who’s buying the products by asking the right questions and really listening to the responses.
- Think about distribution, budget, margins, and COGs.
- Having a product but no distribution streams isn’t viable. Start thinking about distribution now, and you’ll start to see what your financing needs to be for the first 6-24 months after launch, to support the sale of your products.
- If you are selling direct-to-customer through your own website, then you’ll want to make room for storage, and shipping, and leave a healthy marketing budget to attract visitors to your site.
- If you sell wholesale, then you might need extra room in your margins to support sales agents, samples, marketing programs, and shipping to various locations.
- When you have a better understanding of your sales costs, you can get pretty precise about the all-important COGs (cost of goods) and know how much your finished product should cost you, while still allowing a healthy profit.
Step #2: Talk to a Formulator or New Product Developer
You need to get professional feedback on the feasibility of developing your product before you start asking for quotes. This is some nitty-gritty stuff, but here’s why one of your first conversations should be with a cosmetics formulator or new product developer:
- A formulator can help you pick compatible ingredients and flag any potential ingredient restrictions or testing requirements.
- A formulator or developer can help you identify certifications (organic, kid-safe, etc.) that you’ll need to obtain, and explain the steps in securing them.
- You’re probably not a chemist, so you can tap a formulator or new product developer to help you identify active and other ingredients.
When Goldn launches our Product Builder this fall, cosmetic product creators will be able to collaborate with formulators and developers on this very part of idea validation.
Step #3. Get Quotes from Suppliers and Product Developers
There’s a reason this is the last step in idea validation. You can’t start your idea validation by sending a ton of RFQs (Request for Quotes) and waiting to see which producer comes back with the best price. That exposes you to a very high risk of failure, because you’re creating your product in reverse—starting with ingredients and quotes, rather than with a well-thought-out marketing, formula, and certification analysis.
By sharing all or part of your refined product brief and requesting quotes for a detailed idea that’s been looked through more than one lens, you set yourself up for better negotiation with suppliers. You’ll also get fairly specific information back about costs, timeline, and legal requirements to go to market.
Idea Validation is a Lot of Work!
The idea validation phase of cosmetic product development is almost as labor-intensive as creating the product brief itself. But the validation steps we outline here are the ones that can set you up for success during development. Thinking about your overall market and seeking technical feedback are essential steps to see if your product idea has what it takes to make it to development and get to market quickly.
If you are interested in learning more about cosmetic product idea validation, keep your eyes on Goldn.com this fall, when we launch the world’s first Online Product Builder to help cosmetic creators through different stages of product planning in a way that’s never been done before.
Goldn will be the first online tool to make cosmetic product creation simple, collaborative, and fun.
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