Heyday Skincare Says Consumers Crave Brick-and-Mortar Experiences

While many retailers are currently cutting back, Heyday Skincare is adding brick-and-mortar stores.

Heyday CEO and Co-founder Adam Ross told PYMNTS that the decision to grow its 10-store footprint beyond New York, LA and Philly was easy given his knowledge of the business and its customers.

“The facial is the gold standard of skincare,” Ross said. “You need a physical experience to do that. You need estheticians, you need professional products and folks that can work on your skin in the way that you can’t at home with D2C products,” he added.

The company’s expansion plans coincide with its $12 million Series B extension announced Wednesday (Dec. 14) that comes two years after its initial $20 million Series B fundraise. According to the press release, Heyday plans to “open over 30 shops, with a total of 135 committed franchise units on the horizon in major markets including Denver, Boston, Austin, Phoenix and more.

Ross said he believes Heyday’s concept disrupts indulgent beauty treatments by tapping into another factor motivating consumers: a desire for beneficial self-care.

“An unlock for Heyday is that we’ve repositioned the facial out of the spa and into people’s lives, it’s very much perceived as self-care versus beauty,” he said, calling it an important nuance. “When you hear the word ‘beauty’ it does have this pampering and indulgent connotation [but] our clients think about us like they do about the foods they eat.”

To the point, there’s also a monthly membership offering that can be split up between discounted products and services that’s aimed at driving loyalty and retention.

Retailers Embrace Post-Pandemic Beauty Trend, But Cosmetics Have Gone D2C

How to Scale Faster

Taking the franchise route helps the retail skincare network achieve scale faster without needing to raise huge amounts of capital. Ross said, “You can have up to 40 team members in a shop, predominantly estheticians. If you’ve got a franchise partner, they’re invested, they’ve got skin in the game, and they care about the experience.”

He added that the franchise approach also frees Heyday corporate to pursue enhancements that can then be rolled out to retail. “We felt our resources would be better spent around service-menu innovation, creating brand advocacy, and the right value proposition for members. Our franchise partners can be best-in-class operators in a way that we can’t.”

Ross cited other benefits, saying franchise locations “are superior to owned and operated doors across any metric that you want to focus on. It’s not just more top-line revenue, it’s more top-line recurring revenue. It’s higher client satisfaction. It’s lower team member turnover.”

As for the latest capital infusion, Ross plans to invest in “various systems, various team members, various marketing spend so we can set up our franchise partners to open strongly, and just improving the process.”

Target, Ulta To Make ‘Prestige Beauty’ More Accessible With Shop-In-Shops

With 10 franchise partners expected to be onboard by the end of 2022, Heyday has a plan of record for 30 new locations to open in 2023. And there is a line of direct-to-consumer (D2C) products in the offing.

“We’re going to be launching some Heyday branded products for the first time in Q2 of next year,” Ross said. “We’re coming at it from a bit of a unique perspective initially where they’re products that are going to be used in the treatment room. They’re not going to be available for retail purchase.”

It’s a twist on the D2C approach where products are formulated for individual customers based on skin type and other factors.

While he didn’t specify when Heyday products will be available on straight D2C terms, Ross said the company is preparing to roll out its mobile app broadly in 2023, giving customers personalized profiles based on “loads of data” and a seamless payments experience.