Create world-class marketing for your company by using your community’s data!

See how Taiwanese company UrCosme expanded their reach by joining the global beauty network through a Japanese conglomerate.

By Mia , Inside

Since the rise of Facebook, communities with huge numbers of users and data have been highly valued. After Asia's recovery from the dotcom bubble period, Taiwanese beauty community startup UrCosme's Facebook page was created in 2004, the same year that the social media channel was launched. UrCosme's founder, Chen Zongming immediately began building a complete user database which would assist the company in its consumer analysis and the creation of a shopping guide for its customers. 

When quantitative analysis meets the beauty network

CEO and founder of UrCosme Chen Zhongming was working as a quantitative analyst in the finance industry before he moved on to build his business network in Japan, where he joined a recruitment business, and where he was responsible for gathering consumer insight on new business models. Chen then realized that the importance of insight cannot be undermined in business, as it is from the information learnt from insights that a company can improve its business and ensure progress. He subsequently returned to Taiwan in 2003 and tried his hand at running community websites, including a Japanese-Taiwanese import/export business; a wedding platform, which had a variety of wedding products and services for sale (which were selected by actual consumers) as well as forums for users to discuss all facets of wedding planning; and a beauty e-commerce website. In 2005, he also briefly ran a parenting community site, before ultimately focusing on the business that gave him the best results: the cosmetics platform. 

The community mechanism: evaluate your loyal users fairly

From Chen's observations, consumer insights that are picked up from an online community are far better in comparison to street surveys. Specific topics such as what products to buy, skin types, age and how to maintain skin are all discussed by the community, which shares their skincare experiences extensively. What makes this strategy even better is that these bits of information are provided to the company by the actual customers themselves. Chen's work may sound as easy as launching a platform where users can discuss the relevant issues, thereby providing their opinions. However, in order to become one of Taiwan's largest beauty companies, Chen and the UrCosme team have spent a lot of time and effort planning the mechanism of the online community to ensure that the website maintains "impartiality", while simultaneously cementing the company's position in their consumers' hearts and minds as the community to discuss such topics in. 

UrCosme also spent effort building up the website's defense, designing a variety of complex tools to put an end to spamming and advertising, which in turns solidifies the platform's credibility. For example, each user has a "dynamic index" which gains points whenever the user publishes content. The index also tracks how often the user visits the platform, and together, these two values affect how much weight the user's product rating will carry. Additionally, UrCosme also runs an algorithm that tracks and records suspicious IPs, subsequently blocking the spam accounts. As an extra measure, the company's staff members patrol the platform's forums, encouraging members to flag spam accounts. With the help of its consumer base, UrCosme is therefore able to keep a tight check on any potential spammers. 

Non-entertainment of marketing ploys by beauty companies

UrCosme (now re-branded as @Cosme) now has 45.5 million members, with around 6 million daily visitors to the website, while their unique user numbers stand at 110 million people per month. They also have a database of 70,000 SKUs. The company aims to be the best information exchange platform between consumers and manufacturers. 

The intuitive nature of this business model has attracted a lot of attention as well as various marketing proposals for @Cosme. However, because the company is determined to keep its image as an objective platform, it has refused to accept advertorials, sponsorship, promotional materials or trial requests from the beauty industry. Simply put, this is done to ensure that @Cosme doesn't interfere or influence their users' views and ultimately lets the community as a whole decide whether a product is good or bad. 

According to Chen, @Cosme has 3 ways of doing business: 

1. Let the consumers be the brand ambassadors

@Cosme allows influential users participate in platform-created product trials, which have been set up in accordance with certain requirements by the company. @Cosme also uses a dedicated classification tool and SEO (search engine optimization) to ensure that all products available on its platform can be easily searched for and found. Chen reconfirmed that these trials and features would not interfere with the users’ views or reviews of the products, and that users were allowed to share their reviews anywhere.

2. Brand archives and users

@Cosme has categories for brands on its website, but these are mostly in place to divide up the reviews they receive once a user has tried a brand’s product. Chen said that brands should see @Cosme as a “cloud CRM (customer management system); browsers of the website may be potential customers for the brand, while published posts by the users could also be used by the brand to follow up on and maintain relationships with their old customers.

3. Buying an audience with insights

In-depth consumer insights can assuredly be utilized to create effective advertising. By cooperating with the platform’s users and the company, brands can use the information and users’ footprints on the website to piece together a user’s buying journey. This includes tracking the user and their browsing history on @Cosme, what brand information they look for, and which skincare products they want, amongst other things. @Cosme therefore promotes their role as a DMP (advertising data platform) to manufacturers, so as to help them with sales via the platform and to help them plan their advertising strategies on other media channels.

Chen also mentioned that @Cosme would be looking at two new business models in the future:

1. Alongside user information, the system will also capture keywords relating to unexpected effects of a product, symptoms found, and other keywords that will enhance the communication between manufacturer and consumer.

2. @Cosme will be building their own DMP (advertising data platform) to provide 3rd party information for brands, giving them brand insight and analysis. 

By joining the istyle group, @Cosme is on its way to creating a world-class beauty website

Since its acquisition by istyle, @Cosme has gained 4 million members, 15 million website visits, and 280,000 SKUs in Taiwan. The third @Cosme store also opens up on June 30th this year. Chen said that in addition to their online platform, @Cosme also has a chain of physical shops, and hosts the Best Cosmetics Awards in Taiwan, which has proven to greatly influence their consumers’ buying choices.

The @Cosme store is also at the core of providing the customers with an experience in a real beauty shop. More than 8% of the goods in the store come with trial products upon purchase, and reviews on the product as well as its current ranking on @Cosme’s website are all displayed for the consumers. Executive Officer Wei added, “The insights we have from our online consumers have influence the shops’ store displays and design concept and vice versa. It’s an actual example of O2O integration that we’ve been working on and leading for nearly 10 years.”

@Cosme is now planning to build on its popularity and its new connection to Japan with the launch of the Best Cosmetics Awards in Japan, while also taking advantage of istyle’s import/export business to introduce the company’s unique brand to Japanese customers.

Chen concluded that because istyle had recently acquired Malaysian beauty website Hermo, the US-based beauty platform MakeupAlley, and @Cosme, the corporation has now expanded its reach into the beauty industries of Taiwan, Hong Kong, and Southeast Asai, and gained a lot of consumer insight data along the way. The future of beauty platforms will be the integration of the Japanese, Chinese, and English markets, as well as the absorption of several veteran beauty websites. Users will be able to access reviews and thoughts on beauty products from all over the world, and the endgame for the consumer database will be internationalization.

Read the original article here: https://www.inside.com.tw/2017/07/05/urcosme-2