Hello Products has seen sales of its natural oral care products continue to grow through its various retail partners, both online and in-store, during the COVID-19 pandemic, even though it has had to shutter its own e-commerce site and one of its newest retail partners had to close all of its physical stores.
The company, which was acquired by Colgate-Palmolive earlier this year, closed its offices in March because of the pandemic but has kept operations going through twice-weekly video chats with the entire staff, Craig Dubitsky, founder of Hello Products, told CO—.
“We’ve been very fortunate — we’re all healthy and safe, first and foremost, and in terms of our sales, even in this very difficult time, folks still need to brush their teeth,” he said. “One could argue that self-care has even become that much more important as folks want to do everything they can to take even better care of themselves.”
The company has not experienced any supply chain or logistics issues during the pandemic, Dubitsky said, and “has not missed a beat” in terms of its ability to manufacture and deliver its line of oral care products, which provide a natural, clean-label alternative to mainstream oral care solutions.
“Our team has done an incredible job making sure we've had sufficient inventory on hand in terms of ingredients, components and finished products,” he said.
Hello Products had launched a new line of CBD-infused items in Ulta Beauty stores shortly before the COVID-19 outbreak began to spread in the U.S., but the retailer closed all of its stores in March because of the pandemic. The new line, which includes several SKUs of CBD-infused mouthwash, toothpaste and lip balm, continues to be available through the Ulta Beauty website.
The expansion of Hello Products’ assortment follows a year of strong sales growth, and comes as it continues to roll out several new products in 2020, Dubitsky said in an interview at the National Retail Federation show in New York City earlier this year.
In late January, the oral care products company reached an agreement to be acquired by health and beauty giant Colgate-Palmolive, which also owns natural personal care products brand Tom’s of Maine.
According to research from Markets and Markets, oral care was a $44.5 billion product category globally in 2019 and is projected to reach $53.3 billion by 2025. In the U.S., Colgate-Palmolive, Crest and Sensodyne dominate the category.
And Hello Products’ Ulta deal reflects a broader trend of niche oral care brands gaining shelf space at beauty retailers, from Marvis toothpaste at Sephora to Moon teeth whitening pens at Ulta.
Dubitsky has positioned Hello Products as a “naturally friendly” brand, a phrase it has trademarked. (Dubitsky himself personifies the friendly, personal nature of the Hello Products, by posting his own Skype contact info on the company’s website, for example.) The positioning is reflected in the brand’s bright, clean labeling and natural ingredient formulations, which are highlighted on the front of its packaging. All of its products are also vegan and are not tested on animals, he said.
“We’re disruptive because we’re delighting people, and we’re making it affordable,” said Dubitsky. “We like to think we are doing it a different way, with products that are fun.”
We’re disruptive because we’re delighting people, and we’re making it affordable.
Craig Dubitsky, founder, Hello Products
Trends
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Sustainable bamboo for whitening, aloe vera for fresh breath
Hello Products incorporates sustainably sourced, natural ingredients that Dubitsky said provide the efficacy of the chemicals that consumers are accustomed to finding in more mainstream oral care products. For example, it uses activated charcoal (derived from sustainable bamboo), which the company said works as a natural detoxifier to polish, clean and whiten teeth, remove surface stains and freshen breath. Its mouthwash, meanwhile, includes aloe vera for moisturizing.
None of its products contain artificial sweeteners or flavors, dyes, peroxide, alcohol or several other ingredients consumers may be wary of, such as sulfates, parabens, dairy and gluten. It also uses environmentally friendly packaging, including boxes made from 100% recycled paper that are printed with soy-based ink.
Although the new CBD-infused line marks the company’s first foray into the fast-growing CBD product category for health and beauty care, the company has used hempseed oil in several products, including toothpaste, floss and mouthwash, because of its reported ability to promote healthy gums, Dubitsky said.
The Food and Drug Administration is currently researching the safety and efficacy of CBD (which stands for cannabidiol, a compound derived from the cannabis plant). The ingredient has soared in popularity since the federal legalization of hemp cultivation in 2018 and the growing legalization of marijuana in more and more states. CBD users say it has anti-inflammatory properties and offers relief from pain, anxiety, insomnia and arthritis. A Gallup poll last year found that 14% of Americans said they use CBD products, including 20% of Americans age 18 to 29.
Lauri Kien Kotcher, CEO of Hello Products, said more innovation is on the way.
“Our new, groundbreaking launches, along with the continued success with our retail partners, has encouraged us to think big and accelerate the rapid growth of our personal care assortment, with several more exciting innovations to follow later this year," she said.
On-trend positioning
In announcing its acquisition of Hello Products, Colgate-Palmolive cited in particular the brand’s appeal to younger consumers and its “distinct on-trend positioning.”
Both Dubitsky and Kien Kotcher plan to remain with Hello Products following the acquisition, according to Colgate-Palmolive.
Dubitsky launched Hello Products in 2013 in brick-and-mortar retail, and only later branched into e-commerce with its own e-commerce website, Hello-Products.com, and through other e-commerce sites, including Amazon, iHerband Thrive Market, which together generate about 15% of Hello Products’ total sales, he said.
The company’s products are available in 45,000 retail stores, including all locations of Target, Walmart and Dollar General, and through the websites of those retailers and others, such as CVS.com. It is also widely available in large food and drug retailers such as Albertsons, Wegmans, Kroger and Whole Foods.
“We want to make it available to everyone, however they want it,” Dubitsky said. “We believe in a brusher’s right to choose.”
The company’s rapid growth since the 2017 launch of its own e-commerce site had been overwhelming the site’s capacity to handle orders efficiently, however, and last year the company shifted its e-commerce operations onto the NetSuite platform from Oracle.
“The idea that you can use an enterprise suite as a small, entrepreneurial startup is terrific,” he said.
Dubitsky said he sees strong potential for the ongoing growth of Hello Products as consumers gravitate toward natural products with simple ingredient labels and fewer additives.
“Colgate is the ideal partner for Hello, with a like-minded commitment to the best consumer oral health, the environment and our communities,” he said.
In addition, Dubitsky noted that the oral care category is “recession-proof.”
“Everyone’s got teeth,” he said.
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