Debunking the B2B Myth in the Beauty Industry: a case study on how we helped our client transform their business model and transition from B2C to the B2B market

The beauty industry is traditionally associated with retail sales and the B2C model. For decades, cosmetic brands have fought for space on store shelves and in the carts of end consumers. Many beauty business owners are still convinced: the path to scaling lies exclusively through expanding the retail network, aggressive advertising, and the endless pursuit of social media trends.

But what if we told you that the most significant growth opportunities lie elsewhere?

Before you is the story of a company from France (name not published due to confidentiality agreements), which with our help transformed its positioning over 18 months, reorienting from the oversaturated B2C market to virtually untapped B2B territory. The result? A 4.7x increase in the average check, a 62% reduction in marketing costs, and a stable cash flow without seasonal dips.

In this case study, we will partially break down the strategy that allowed a regular manufacturer of natural cosmetics to become a key supplier for the corporate and other business sectors. You will learn about non-obvious entry points into the B2B market, the specifics of forming commercial proposals, and scaling production without catastrophic investments.

Ready to see the beauty industry from a completely new side? Then let's go!

Background and Crisis:

This company started as a typical startup in the field of natural cosmetics in France. The founder of this brand launched the production of organic skin and hair care products in 2015. For the first two years, the company developed according to a standard scenario:

• Sales via Instagram and Facebook and its own online store
• Participation in marketplaces and specialized exhibitions
• Gradual scaling through placement in chain stores

By the beginning of 2020, monthly revenue reached 10,000 euros with a margin of 32%. It seemed like a classic success for a niche brand of natural cosmetics. After our analysis of the client's company, we saw a bleak reality behind these numbers:

• CAC (customer acquisition cost) was constantly growing and reached 32 euros;
• 74% of revenue went to marketing and commissions of trading platforms;
• Seasonality led to cash gaps in February-March and summer months;
• Competition in the organic cosmetics niche intensified every month;

"A slow death from resource depletion awaited us. We were spending more and more on attracting customers, but profit was not increasing. We had quality products and a loyal base, but it was not enough for sustainable growth." — the brand owner admitted to us.

This was the beginning of our acquaintance and work with this company.

A Chance Discovery and the First B2B Contract:

The turning point came unexpectedly. Our company developed a promotion strategy for the next 18 months. Initially, our plans included participation in exhibitions and active engagement with business owners. During another natural cosmetics exhibition, we spoke with the owners of a chain of beauty salons and inquired if they needed cosmetics in bulk, and it worked. The owner of the beauty salon chain was looking for a local manufacturer to create a signature line of cosmetics for their salons.

"We had never considered such a cooperation option. But the proposal from the customer seemed interesting: an order for 1,500 sets with the possibility of regular supplies." — recalls our client.

The first B2B contract had several features:

• The order volume exceeded the average monthly turnover of the company;
• Customization of packaging with the customer's logo was required;
• Delivery times were more flexible than when working with retail;
• Prepayment was 70%, which solved the problem with working capital;

The successful implementation of this project forced our client's team to reconsider their development strategy and step-by-step implement all our recommendations. They discovered an unexpected fact: while the B2C natural cosmetics market was oversaturated, the B2B segment saw a shortage of quality local manufacturers capable of providing a personalized approach.

After the first successful B2B contract, our team conducted deep market research, identifying several promising B2B niches for our client, considering that the client already believed in our strategy of changing the business model and was very motivated at this stage of cooperation.

What we achieved together with this client over 18 months of work:

• Financial Indicators:
  • Revenue grew from 10,000 euros to 115,000 euros per month;
  • Operating profit increased from 20% to 45%;
  • Marketing expenses decreased from 74% to 28% of revenue;
  • Predictability of financial flows improved thanks to long-term contracts;


• Structural Changes:
  • Staff was reduced from 17 to 14 people despite revenue growth;
  • Production areas increased by only 30%;
  • The cost of attracting one B2B client on average pays off after the first order;

"Thanks to the cooperation with the WebSEOMarket agency, which played an important role both in strategic planning and in the restructuring of our brand's business model, we successfully transitioned from a retail approach to a B2B focus. This transition helped us move away from the unpredictability of working with individual customers, leading to more stable income and strengthening our brand's market position. I wholeheartedly recommend this agency as a reliable partner for long-term consulting cooperation" — this is a real positive review from our client, a cosmetics manufacturer who changed their business model thanks to our recommendations and constant support over 18 months. We are moving forward! We have drawn up a very interesting development plan for them for the next 3 years and also expect 'bomb' results, as we not only build strategic planning but use business development and marketing consulting as tools to bring this strategy to life.

The story of this case was told by Stanislava — a leading specialist in our company, a marketer with 30 years of experience in various business niches, 18 years in SMM, an expert in social media business promotion, and the founder of our full-service marketing agency (from idea to website, from website to promotion and sales in business) — webSEOMarket.

If your business or production has reached a "ceiling," contact us. We will be happy to develop short-term plans (6-12 months), medium-term plans (1-3 years), and a long-term vision for your business development and will accompany you to achieve the desired result. In plain language, we will tell you "where we want to invite you" and what results to expect, and then focus on "how exactly we will get there." Contact us using the form below if you are already ready to change your business model or change something in your business: