Michelle Phan, the founder of makeup subscription service Ipsy, started her entrepreneurial journey making videos demoing different makeups and showing viewers how to achieve particular looks.
8.3 million YouTube subscribers later, she has a makeup line, a book, over a billion views overall, and a company—Ipsy—which sells makeup on a monthly subscription.
It’s worth a reported $800 million.
Her production studio, Ipsy Open Studios, helps thousands of amateur makeup video bloggers do what Phan always wanted to do: create professional-level content that can drive sponsorship deals without signing onto a gouging contract with a major label.
This network of content creators doesn’t just like Phan on Facebook—they’re using Ipsy’s resources and spreading Ipsy’s products through native advertising to drive their own entrepreneurial ventures and follow in Phan’s footsteps.
Ipsy’s ascent, ingeniously built on and driven by Phan’s massive, devoted social following, is emblematic of a new trend in influencer marketing.
It’s not about using influencers simply as “promoters” of your brand. Promoters may have status and clout, but they’re like mercenaries. They do the job they’re hired to do and nothing more.
Building a strong business means turning those influencers into real engines of growth by building a mutually beneficial network of “pillars.”
Help Your Promoters Win And They Will Become Pillars
The generic influencer relationship is transactional. A pants company gives a YouTube star $5,000 to promote their pants, the video drives a certain amount of traffic, the ROI on the campaign is measured, and the relationship is over.
But money and fame are limited motivators. What really gets people motivated is the essence of entrepreneurship—freedom.
The secret is helping those who want to be successful… Help young people. Help small guys. Because small guys will be big. — Jack Ma
The new influencer marketers use their content and resources to help their promoters start their own businesses. With their expertise and scale, they help them accomplish far more than they could possibly accomplish on their own. And their success is built into the company’s success, so everyone grows. The better their promoters do, the better the business does—and vice versa.
1. Find Your Audience
The first step to turning promoters into pillars is finding a direct route to your audience. You want a platform where your differentiation can work in your favor, where you can tap into your niche with targeted content and start building a market.
YouTube, which launched to the public in 2006, made internet video accessible to a new, highly-engaged, young audience. Phan’s star rose along with YouTube’s as her makeup videos entranced a generation of teens. Her Lady Gaga makeup tutorial from 2012, has over 53,000,000 views. That’s more than double the number of people that watched the Rio Olympics on NBC.
YouTube has since become saturated with videos and content creators, which means it’s harder to reach your niche and keep their attention there. Investor Jason Calacanis suggests entrepreneurs focus on owning their relationship with their customers any way they can, whether that’s through:
- Blog posts: Bring readers to your actual website to read your content, not to Tumblr or Medium. Aggregators and publishers are incentivized to take your readers and lead them to more of their aggregated content—not to help you monetize.
- Email lists: Email is still the best way to keep in touch with your customers in a personal way. And that’s a relationship that is contingent on no third party.
Maybe you hear “blog” and “email” and think “table stakes.” You’re not going to have as large an audience if you focus on building authentic relationships with real fans, but it’s not the size of your market that matters at this point. It’s their engagement. Find a niche and start building your market, but focus on quality rather than quantity.
2. Sell Your Audience Something They Want
Once you have an audience, you should have a good idea of who those people are and what they value about your content. Even more importantly, you should understand what their main pain points are. The next step is to help with those pain points.
Ipsy’s Glam Bag is at the center of their business model. A $10 bag of curated makeup delivered on a monthly basis, it is both cheap to produce (Ipsy provides makeup manufacturers with exposure and advertising) and ties powerfully into the value that Michelle Phan delivers with her video content.
Before a Glam Bag is sent, customers fill out a survey about their attributes (eye color, hair color, etc.) and their makeup preferences (brands they like, brands they don’t), and Ipsy sends them a personalized bag. Each kit comes with videos made by Phan and other Ipsy stylists demoing the products and showing how to use them.
On YouTube, she taught people how to create different looks and wear different kinds of makeup. With the Glam Bag, she solves a related but even bigger problem—actually finding and choosing makeup to wear. Phan is helping people short circuit the process of putting on makeup by selling them both the tools and the techniques. Is it working? “Right now we’re sending out 700,000 bags a month,” she told Recode, “$10 each. So you guys can do the math.”
3. Start Building Your Network
Once you’ve started consistently selling to your niche, you have product-market fit. The last step is to build out your network of promoters and give them the tools they need to become self-sustaining.
Once Ipsy was succeeding with their Glam Bag, they started Ipsy Open Studios. With a full-fledged series of video production suites located in Los Angeles, California, Open Studios was designed to give up-and-coming YouTube stars everything Michelle Phan wished she had when she was starting out.
That includes empowering content creators to make professional work without signing onto debilitating contracts with large brands—cameras, studio space, mentorship, and all of it totally for free. New artists can go to Open Studios and start immediately producing the same kind of professional content that Michelle Phan got after years of running her amateur account.
In return, free Glam Bags are sent to video bloggers participating in the program, and they’re expected to give reviews of the products—spreading the word about Ipsy with the same kind of native advertising that Michelle Phan took part in while coming up.
The more people sign up for Open Studios, the more that content creators out there are talking about Ipsy and using Glam Bag products. The more people buy Glam Bags; the more Ipsy can invest in Open Studios—it’s a virtuous circle.
Promoters Are Temporary—Pillars Are Forever
When you’re looking to bring influencers into your business, it’s easiest to start out treating them as promoters. But if you’re building for the long-term, it’s essential that you find ways to embed them deeper, to give them the resources they need to do more and more.
“When you apply, our dedicated team evaluates creators against a predetermined set of criteria: quality of content, publishing frequency, traction, level of engagement,” Phan says of Ipsy Open Studios, “As with all creative endeavors, it’s about finding the right fit… But when we find a relationship, we’re looking to make it long term.”
In the short-term, paying people to promote your business can provide a significant return.
But businesses that give their promoters the tools to be successful in life—that become niche, specialized and highly valuable platforms, in essence—can truly stand the test of time.