SKNHEAD is the new male grooming range brought out by award-winning celebrity hairdresser and serial hairdressing entrepreneur, Adee Phelan.
Since our previous successful round on Seedrs, we exceeded all of our sales expectations to the trade. We launched to the trade, selling through two of the large distributors in the UK. Early sales outstripped our predictions in the original financial model.
Adee is is known for being David Beckham's hairdresser and for cutting his famous mohawk haircut, and for multiple TV appearances, including Channel 4s The Salon, Secret Millionaire, and NBC's hit show, Shear Genius. SKNHEAD is one of the first male grooming range of products to be brought out by a recognised male celebrity hairdresser, in an industry that is worth over £450m in the UK and $21bn globally.
SKNHEAD seeks to be UK and Ireland's most respected luxury male grooming line, which is already sold in more than three countries. Adee has wanted to bring out a male grooming range for a number of years, but only recently has he felt the market is ripe.
Until now, most male grooming lines have been brought out by recognised female haircare and toiletry brands, and some male fashion designers. This has resulted in little innovation because they are often repurposed female products, while we believe men approach grooming in a very different way. SKNHEAD takes Adee's many years of experience in listening to top professionals and high-end customers to build products around the specific needs of men.
This approach is set to revolutionise male grooming, a market that is booming precisely because it's finally providing men with their own identity.
Substantial accomplishments to date
After our successful Seedrs round towards the end of last year, we have launched SKNHEAD to the trade. It has been a huge success, with sales in more than three countries, and exceeding our expectations for the number of trade sales we predicted we would make in the first three months. We have secured two distributors who supply the market for barbers and salons. Our social media accounts have grown massively, achieving over 20k followers on Instagram, 25k on Twitter and over 38k likes on Facebook. We were also invited to speak on the main stage of the Barber Connect conference, a major industry event.
We now need to capitalise on this market opportunity by raising awareness of the brand amongst consumers. We believe the best way to do this is through more marketing and by attending the major trade shows. Additionally, we sell straight to the consumer online which keeps them in our own sales funnel. We hope our plans for effective marketing will increase our direct to consumer sales. We have also signed up a number of celebrity affiliates who have agreed to promote SKNHEAD products. Many of these celebrities normally only take payment up front, anything from £5,000+, but given Adee's credibility they are willing to promote our products on commission only. This is interesting for us as it removes the potential of future marketing budget bottlenecks and heavily incentivises the celebrity affiliaties to keep promoting SKNHEAD products.
SKNHEAD products are sold online and through professional salons, and will be sold through celebrity affiliates, YouTubers and high-end department stores.
According to Pixability, male grooming is the fastest growth sector across all online tutorials. This presents an opportunity - by tying in celebrities and YouTubers, we can leverage influencers to show how our innovative products are meant to be used, and capitalise on this trend.
One of the most respected names in male hairdressing, Adee has run hairdressing seminars across Europe and the US, so has a high number of barbers and hairdressing professionals who may be interested in stocking SKNHEAD products.
We intend to be a brand that grows through word-of-mouth. Crowdfunding is a very attractive proposition for us because it means we can empower our investors to start spreading the word from day one.
Use of proceeds
The funds will predominantly be used for marketing and PR to increase our online sales channel, and to satisfy our distributors that we're supporting their channels with promotions. Around a third of the funds will be used to pay for Salon International, the industry show that attracts the biggest names in hairdressing.
The company has a director's loan of £25,000 taken out in March 2018, which accrues interest at 6% per annum, amounting to a total repayable amount of £29,043.78. None of the proceeds of the Seedrs investment is intended to be used to repay this debt.
Our core target is affluent, well-groomed men who know what it takes to look stylish, and those who aspire to improve their style. Millenials are becoming more image conscious, so we're looking to target this population alongside the over-thirties, many of who have likely grown up knowing about Adee through his television work.
Characteristics of target market
There is evidence this is a growing market, both here in Europe and in the US. The global male grooming market is worth $21bn and is set to grow at CAGR of 8.4% from 2016-2024. Additionally, the global men's skincare market is set to reach $5bn by 2020, achieving a CAGR of just over 7%. Around 40% of men in the UK now use facial moisturisers.
Considering the potential for the business we will have a relatively modest marketing budget of £5,000 per month, which will mainly be used for PR purposes to attempt to gain exposure with the fashion, men's interest and lifestyle press. We will also be active on social media, with budget set aside for someone to work part-time on promoting SKNHEAD.
Ordinarily, a new grooming brand would need a sizeable budget to pay influencers to talk about their products, but for SKNHEAD we've been able to agree an affiliate model only with major influencers, which will keep this cost down.
The only other cost for marketing is to attend major haircare events and conferences such as Salon International in October. The plan is to take some of our celebrities along to these events where fans can receive photographs when they buy SKNHEAD products.
Other than Adee there currently isn't, to our knowledge, a major celebrity hairdresser known specifically for cutting men's hair, so we don't see any direct competition for the model as it stands. However, we are intentionally making the SKNHEAD brand grow with its own prominence, which we believe will make it more attractive for a trade sale.
There are some fashion designers who are arguably competition, however we believe they are not known specifically for bringing out highly technical products that are built around the needs of men.
Our biggest competition probably comes from the recognised household brands. They are starting to bring out more male-orientated technical products. However, we see them more as potential buyers than a serious threat to our initial sales model.