Lawsuits and unfavourable social media posts ruin the pioneer of hair care, Olaplex.
Social Media’s Part in olaplex’s Development and Decline
Olaplex’s story is a perfect illustration of the impact of social media. Content makers first bolstered sales of the bond builder, but more lately, claims of hair damage have damaged the product’s image.
Shifts in Leadership Despite Obstacles
JuE Wong is leaving her position as Olaplex’s CEO. Early in 2024, Amanda Baldwin, a former Supergoop! CEO will take over as Wong’s successor. The company’s executive chair, John Bilbrey, will take on the CEO role. On Thursday, Olaplex’s stock, listed on the NASDAQ under the acronym OPLX, mainly finished unchanged at $1.77.
JuE Wong’s Position and IPO Performance
In 2020, Wong—a seasoned professional in the cosmetics sector with past work at Elizabeth Arden and Moroccanoil—joined Olaplex. She led the business through the epidemic, which resulted in a successful IPO in 2021.
Reduced Sales and Legal Concerns
Following unfavourable social media remarks and a lawsuit filed by 28 women in February 2023, who claimed that Olaplex Nº.0 and Nº.9 caused hair loss, sales started to drop. Olaplex defended the efficacy and safety of its products. Only one of the plaintiff’s claims was allowed to advance by the court, and the complaint was mainly dismissed. Later, the plaintiff chose to withdraw her lawsuit voluntarily.
Money Problems Even with Marketing Attempts
Olaplex has seen a decline in sales even with more promotions. After $704 million in 2022, the business projects net sales of $445 million to $465 million in the next fiscal year, 2023. Revenue for the second quarter fell by 48% to $109 million, primarily due to subpar results in the specialised and professional retail sectors.
Comprehensive Analysis of Sales
Seeking Alpha attributes the decline in sales to several factors, including less demand, heightened competition, inventory changes, and poor performance in the professional channel. Direct-to-consumer sales plummeted by 6.4% to $39 million, retail sales fell by 54% to $30 million, and sales via professional channels fell by 61% to $41 million.
Wong’s Social Media Presence and Advocacy
On Instagram and TikTok, Wong constantly expressed her appreciation for Olaplex products and even addressed false information about the company. In February, she reassured viewers that Olaplex products had undergone clinical testing and were safe.
Amanda Baldwin’s New Leadership
Industry insider Jeffrey Ten thinks Amanda Baldwin’s hiring will benefit Olaplex. Baldwin wants to return Olaplex to its former splendour by fusing science and beauty, interacting with merchants, stylists, and customers with cutting-edge goods, captivating narratives, and an exciting global approach.
Baldwin’s Experience and Knowledge in the Field
Baldwin has about 20 years of experience in the beauty business, so she is ready for her new position. Analysts such as Ashley Helgans of Jefferies think Baldwin’s breadth of experience—particularly in marketing—will assist Olaplex in repositioning and restoring its reputation.
The Future of Olaplex With Baldwin in Charge
One of Baldwin’s primary targets will be regaining Olaplex’s top ranking among bond builders like K18, Epres, Redken, and Everpure. In 2022, searches for rival products like K18 and Redken Bonding started outpacing those for Olaplex.
Taking Competition and Distribution into Account
Ten advises Baldwin to concentrate on handling distribution and regaining the salon’s confidence. Handling counterfeit goods will also be essential.
Baldwin’s Possible Effect
According to Jodi Katz, CEO and Founder of Base Beauty Creative Agency, Baldwin’s innovative and data-driven strategy will aid in Olaplex’s turnaround. Baldwin’s creative leadership and marketing strategies at Supergoop! are a plus for Olaplex.
Retaliating Against Impersonators
Olaplex started a campaign last month to dispel myths about the original Olaplex No 3 Hair Protector. Even with these attempts, false information had already caused substantial harm.
Market Difficulties
Helgans observes that Olaplex’s market share has declined since new bonding brands entered the market and because unfavourable headlines have undermined support among professional stylists. During a conference call with analysts for the second quarter, Olaplex admitted that its marketing and education initiatives had not resulted in the anticipated increase in sales.
Author Bio
Experienced cosmetic writer Waleed Murad has a strong interest in hair care. Her proficiency with CER-100 has established her as a prominent figure in the beauty sector. Readers who want to enhance the health of their hair love Waleed because of her articles’ depth, clarity, and valuable suggestions. She has a gift for simplifying complex concepts into material that is simple to read, empowering her audience to make wise decisions. Waleed commitment to educating her audience about the advantages of CER-100 and other cutting-edge goods is evident in her writing. Her writings always continue to enlighten and inspire.
