Paul Jauregui had a lot to have a good time when he first appeared on this podcast in 2020. BK Magnificence, the cosmetics firm he co-founded together with his spouse, Lisa, had reached $1 million in gross sales in its first yr. He returned in early 2022 with extra excellent news: The corporate had launched a thriving internet affiliate marketing program and bypassed the Fb advert meltdown from iOS 14.5.
He’s again, having surpassed a whopping $10 million in annual income, bolstered by early success on TikTok Store. On this our third interview, he shares BK Magnificence’s development challenges, optimistic TikTok vibes, and extra.
All the audio of that dialog is embedded beneath. The transcript is edited for readability and size.
Eric Bandholz: You’ve reached $10 million in annual gross sales in simply 4 years.
Paul Jauregui: Sure. Three years in the past, we had been celebrating crossing the $1 million mark. Final week, we simply crossed into eight figures. Managing that comes with challenges. We’ve discovered lots. Our enterprise has three parts at any given time — provide, demand, and supply. Alongside the best way, we’ve had supply-related issues, forecasting glitches, and stock shortages.
On the demand facet, paid buyer acquisition was a giant a part of our current development. Going from $5 to $10 million in annual gross sales throws the provision equation out of whack. We’re doing achievement in-house, so our capability to ship items and packages to our clients and get them out the door is reaching a stage I by no means anticipated. Final month, we shipped over 20,000 packages. We’ve a each day baseline however nonetheless expertise enormous spikes with varied occasions and launches.
Bandholz: You’re now promoting on TikTok.
Jauregui: We’ve been on TikTok Store for a couple of month and a half. These are the pioneering occasions. After we joined, it was earlier than Shopify rolled out its native integration. We discovered some preliminary success. We had been additionally onboarding into Amazon. We had been halfway by the method and dealing with Amazon’s rising manufacturers crew. Nevertheless, just a few days in the past I emailed Amazon to push that launch into 2024.
As a substitute, I must concentrate on an space of the enterprise that aligns extra with our DNA. We’ve all the time labored with content material creators on social platforms. TikTok Store aligns properly with that effort. We’re seeing quite a lot of success. It makes up about 15% of our complete income on any given day, and that’s rising.
Nevertheless, TikTok is spending some huge cash extending reductions to consumers on the platform — roughly 20-40%. We don’t pay for that. It drops on to the underside line. TikTok additionally gives free delivery, which fits into my pocket too. Each of these — reductions and free delivery — are serving to with conversions.
There are various advantages to getting in now with TikTok Store. We anticipate heavy promotions by TikTok throughout the vacation procuring interval in three key areas: retailers, shoppers, and content material creators.
We’ve been operating an associates program by way of ShareASale. That’s how we’ve compensated of us on platforms like YouTube. Nevertheless, it was not simple to have an affiliate hyperlink on TikTok. There’s no description field beneath the movies, and never everybody goes into the feedback. We might see a video on TikTok about us, and our YouTube natural visitors would surge as a result of of us needed to Google us to be taught extra and purchase our merchandise.
All of that now takes place on TikTok. Of us watching the movies can examine us out proper there. Earlier than TikTok Store, dozens of distinguished creators on that platform talked about our merchandise. However, once more, there was no type of clear path to purchase. I checked out it as top-of-the-funnel consciousness.
Now TikTok captures the precise transaction. The gross sales come from content material creators speaking about merchandise they love. TikTok has enabled them to monetize that extra successfully and share it with the shoppers with out leaving the platform.
Certainly one of our prime movies on TikTok has about 1.7 million views. A content material creator put it out just a few weeks in the past. It’s generated low 5 figures in gross sales and a great deal of commissions for her.
Bandholz: Is that course of much like Meta’s outlets?
Jauregui: No. We’re on Fb and Instagram outlets. We’ve advertisements operating on these platforms. But it surely’s not getting a lot of my consideration. Ecommerce is a precedence for TikTok. They’ve their very own native associates program, checkout, and skill to create demand and consciousness. There’s even a TikTok achievement. It’s all self-contained.
TikTok’s ecosystem is exclusive. Meta’s promoting platform is the world’s best buyer acquisition resolution. TikTok has that, too, nevertheless it’s enabling creators to earn a fee, incentivizing them to provide extra content material. Meta creators don’t get commissions that I’m conscious of — no less than not in a simple means.
So our focus now’s educating creators on TikTok and getting them onto TikTok Store. Many creators haven’t tried it. To assist, our crew created a information. We’re contacting creators already speaking about us on TikTok. That’s the place we see probably the most success.
Bandholz: The place can of us attain out to you?
Jauregui: Our website is BKbeauty.com. I’m @pauljauregui on Twitter. I’m additionally on LinkedIn. Attain out, and I’ll ship you that information.
