Arcade Beauty Primer

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Part
01

Arcade Beauty - Customers and Business Model

Arcade Beauty is an innovative company that has made strategic plans to invest in new technologies, develop mini products, build customer relationships, and expand to new markets. Their most current brand partnerships have been with Galenic, Lancome, and Garnier. No publicly available or preexisting information appears to be available for Arcade Beauty's current or primary customers. However, some reports and interviews from key people in the company offer insights on their recent partnerships as well as their operations and business strategies. More details of what was found are included in the overview below.

BRIEF BACKGROUND

Arcade Beauty is "a leading global provider of customized sampling solutions for the beauty industry." They offer a large selection of sampling technologies in all beauty categories. Their products include: "applications for direct mail, magazines, in-store and promotions as well as saleable products". They are an international company with manufacturing facilities in North America, South America, Europe and Asia. They have five production sites in Europe: one in Poland and four in France. Their subsidiaries include: "Biopack, Carestia, Dixon Direct, Le Papillon, Mappel, Phoenix Glass, Socoplan and Socopol".

BRAND CUSTOMERS

Arcade Beauty is a private company and no reports or press releases appear to be publicly available from them in reference to customers that they primarily or currently work with. However, their website indicates that they have provided sampling solutions to several well-known brands, including: Michael Kors, Clarins, Clinique, MAC, Mary Kay, and Bulgari.

Additionally, other sources have shown that they have had recent customer partnerships with the following brands:

Galenic (Pierre Fabre) — Early in 2017, Arcade Beauty developed an Easysnap sample for the Galenic brand for its Sculpteur de Perfection Lifting Duo Serum.
Lancome — Arcade Beauty developed “a seven-day, seven-product sample for Lancôme utilizing its BeautiPod mailer”. Arcade’s BeautiPod technology is said to accommodate larger fill volumes and the sample stays attached to the marketing materials.
Garnier — Arcade also “developed and produced three variations of a saleable single-dose (20ml) solution for Garnier Original Remedies hair mask formulations”.

This allows us to infer that Arcade Beauty's primary customers are global luxury beauty brands, ranging from hair to skincare to makeup.

BUSINESS MODEL

Arcade Beauty generates income from providing customized sampling solutions for the beauty industry. In an Interview with Carl Allain, the Europe General Manager, he mentions that approximately “50 to 55% of their turnover comes from North America, 35 to 40% from Europe and 5 to 10% from Brazil”. Key to their success is the customer demand of samples from the brands they work with, which helps boost sales.

Their current operational strategy is directed towards:

• Innovation and Investing in New Technologies
Carl Allain notes that the company is heavily investing in digital to change the way samples are distributed. They are focusing on a more “targeted and smarter distribution” for a better return on investment. The company aims to support their customers with distributing samples through a digital environment, "in order to build a bridge between the virtual world and product testing."

They are also moving towards increasing product customization in all markets. In 2016, they also invested in digital printing by acquiring an HP Indigo 20000 printer for their labels. In 2017, they made investments in Adelpi’s interactive sample distributor, "a French startup that specializes in the development of interactive consoles that can distribute samples or offer mini-products for sale and also collect consumer data".
• Development of Mini Products

Arcade Beauty is also focused on meeting the growing demand for mini- and single-dose products by brands and consumers. They are aiming to meet consumer demand for the “beauty to go trend” and for "cheap and easily accessible" products. Brands, on the other hand, find them helpful as a low-cost solution to introduce consumers to a new product.
• Building Customer Relationships

They also aim to create and consolidate customer databases, as they are looking for ways to enhance customers’ experience.

• Direct Marketing and Geographic Expansion

Arcade Beauty is also making their direct marketing operations more targeted in the following areas: “distribution of samples placed in the boxes sent on subscription, distribution operations related to online communications, or for the development of customer databases.” Xavier de Jarnac, the Marketing & Digital Director of Arcade Beauty, mentions that their "mail solution is an excellent complement to digital technologies, and it offers very attractive ROI".

In 2015, Arcade Beauty formed a strategic partnership with Easysnap to "allow both companies to increase their market share and work together to market and distribute Easysnap’s patented one-handed unit dose sampling system worldwide". This 2015 article was cited as it was relevant to the innovation and market expansion that is part of Arcade Beauty's business model. Easysnap also appears to be one of their primary partners.

Arcade Beauty also aims to develop their presence in different markets and are looking at UK or Germany, as well as the potential of Carestia (one of their divisions) in the North American market.

CONCLUSION

To summarize, Arcade Beauty aims to innovate by investing in digital. They are focused on meeting consumer and brand demand and are looking to enhance customer experience. They are also working on increasing their presence in different markets. Galenic, Lancome, and Garnier were found to be their most recent customers.
Sources
Sources