Aesop: from indie side hustle to billion-dollar deal
12 Apr 2023
Last week, industry headlines captured our attention — beauty giant L’Oréal secured a deal to buy Melbourne-founded skincare brand Aesop from the Brazilian beauty conglomerate Natura and Co. It just so happens that the $2.53 billion transaction is L’Oréal's biggest acquisition on record.
Not too shabby for an Aussie brand that started as a hair salon side hustle.
Founded in 1987 by Australian hairdresser Dennis Paphitis, the brand acted as an independent hairdressing salon that sold products. “Early on, Aesop was a unique product with an early adopter customer base. No one knew about it, and we were never going to gain any scale unless we could reach out and touch people,” states CEO Michael O’Keeffe, who took charge in 2003 and vastly accelerated the slow-beauty brand’s growth. “We’ve transformed into a business with a product that’s highly differentiated, and a business model that’s highly differentiated.”
When launching a new outpost, Aesop strategically starts by taking over several storefronts in an emerging neighbourhood, allowing them to choose which brands become their neighbours — so they can build relationships and cultivate stores that end up serving their clientele.
Every Aesop location has its own elevated and individual look and feels — each designed by different architects, integrating the distinct identity of that area into the sumptuous space. The final flourish? Once open, the sales teams are trained to go the extra mile for their consumers. If there is nowhere to buy essentials nearby, they bring them into their own space, often selling items like newspapers and flowers next to their line of skincare staples.
It’s this level of detail and their focus on creating exceptional experiences for people through space and service that has made Aesop so successful.
Starting small, building slow and steady, while championing creativity in an innately sustainable fashion, is what makes Aesop stand out against its contemporaries — in this fast-paced, post-pandemic world we live in, it's refreshing to see a brand stick to its schedule: beauty brands generally launch things monthly, sometimes even weekly, however, Aesop launches them simply when they are ready.
“We have adhered to a fiercely independent approach to skincare, and found our voice by operating outside of the industry,” states co-founder and CCO, Suzanne Santos. Paphitis adds: “If what we’ve created has shifted the dial a little in inspiring others to think harder, tone it down, say more with less, that’s probably a good thing.” A very good thing indeed, for any inspiring entrepreneur.
If you’re looking for space for your idea, a space to design and create a unique brand identity, and a place to bring your community together IRL, look no further.