Kylie Jenner:The Business Behind Her Billions

Over the past few years, the beauty industry has been showing signs of change. Oerhaps the most significant change is the rise of independent and celebrity-backed beauty brands. While in 2016 traditional makeup sales decreased by 1,3 percent, sales of independent and celebrity-backed brands increased by 42,7 percent. And the importance of social media and a loyal fan base are undeniable factors for such a rise.

Fabrizio Freda, CEO of Estée Lauder, once said that “Millennials are avid buyers of cosmetics and appealing to them is crucial nowadays. They have 10 lipsticks for every three their mothers had.”

Well, it looks like Kylie Jenner knew that all along, as her company Kylie Cosmetics, which was established in 2015, has just crossed the 630 million dollar sales mark, and is now worth close to 800 million dollars. And the key to such fantastic success was…a lip kit. Well, that, and also Kylie’s expertly executed social media strategy combined with marvellous marketing techniques.

At first, Kylie — as well as all the Kardashian-Jenner clan, was often referred to as “famous for being famous”. This label was inevitably attached to all siblings, but the youngest daughter of Kris and Caitlyn Jenner knew that this was not the label she wanted to be associated with for the rest of her life. Kylie once mentioned that she “struggled for a minute with finding something to do on my own”, and that’s all it took for her.

We’ve mentioned that social media and a loyal fan base are perhaps the most important aspects in reaching success for new brands. And what if you already have hundreds of millions followers?

Last year, when she was 20, Kylie reached 100 million followers on Instagram alone. She also has more than 25 million followers on Twitter and 20 million on Facebook, and is the world’s most-watched person on Snapchat, bringing her social media reach to more than 150 million people. Many of these followers are also Kylie’s target audience — young women and girls who love makeup. And Kylie sure knows how to keep her fans engaged, as leveraging her social media following is what helps her make money. She posts selfies on her social media almost hourly, and most of them include captions about whichever of the Kylie Cosmetics products she is wearing. She also posts videos of forthcoming products and announces new launches there, making her fans wait impatiently.

To take you back a little, Kylie had a truly different childhood: she was always there, in the spotlight, among many cameras and photo shoots.

However, it was not all just lights and glitter, and Kylie admitted that she had always been precocious, especially about her appearance, so she turned to makeup to help her feel more confident. At that time, she developed a habit of applying a liner beyond her lips’ natural perimeter to create the illusion of bigger lips: “I was insecure about my lips, and lipstick is what helped me feel confident.”

However, Kylie managed to turn her insecurities upside down and created a multimillion-dollar business in less than a year. In 2014, when she was 17, Kylie trademarked the phrase “Kylie Lip Kits…for the perfect pout” — and this happened 2 years before she created her own company.

Kylie’s fans on social media popularised her lips and participated in the so called “Kylie Jenner Lip Challenge” that was going on at that time.  And just like that, Kylie came up with an idea. She used 250 thousand dollars of her own earnings from various modelling gigs and paid an outside company to produce the first 15 thousand lip kits.

This is the moment when Kylie’s status of “Instagram Princess” really paid off, as before officially launching the lip kits, she spent a few months dropping hints and teasing her followers on Instagram about the upcoming campaign. Then, finally, she announced the launch of the lip kits on her social media just a day before they went on sale. It worked: the kits all sold out in less than a minute.

At first, the release of the lips kits was planned as a one-time thing. But Kylie’s mum, Kris Jenner, had a feeling that this might be a great opportunity for her daughter to jump into an ongoing business instead. In 2016, Kylie’s lip kits relaunched with a new name — Kylie’s Holiday Collection — and in a new home, Shopify, perhaps the most popular e-commerce platform worldwide, run by Canadian billionaire and entrepreneur Tobias Lütke.  And this time, Kylie decided to play big. Instead of preparing 15 thousand lip kits, she 

went with half a million lip kits in 6 different shades. The game was on: Kylie’s Holiday Collection earned 19 million dollars in the first 24 hours after launching. By the end of the year, Kylie Cosmetics reached a revenue of 307 million dollars, and within the first 18 months of the brand launch, the company had generated sales of 420 million dollars.

Now Kylie’s company sells 50 different products, including not only lip products, but also eye makeup, blushes, highlighters (also known as “kylighters”) and various make up tools. Kylie owns 100 percent of Kylie Cosmetics, and besides being the company’s CEO, she is also the chief marketing officer and chief creative officer.

It might be tricky to understand just how big and impressive these numbers really are. To put that in perspective, we have a few examples: Tom Ford’s Beauty brand took a decade to reach the 500 million dollar mark, L’Oreal’s Lancôme cosmetics line took 80 years to hit 1 billion dollars, and MAC waited 13 years to achieve the 250 million dollar mark.

One more important thing to put in perspective: Mark Zuckerberg became a billionaire at the age of 23. Evan Spiegel — in his early twenties. But Kylie Jenner changed this game as well, as she is about to become the world’s youngest self-made billionaire ever, male or female.

2018 was a good year for Kylie for a few more reasons: she earned a new title of being the highest-paid woman on this year’s Celebrity 100 list. The youngest member of the Kardashian-Jenner family is also richer than any of her siblings, with a net worth of 900 million dollars. On top of that, it’s estimated that Kylie Cosmetics will be worth over a billion dollars by 2022.

And Kylie knows that she’s one lucky girl: “I’m so blessed to do what I love everyday. I couldn’t have dreamt this up!”