← The Barefaced Podcast
Loading summary
Transcript23 lines
- [00:00]
Eli Twelve Tree
Sam hello and welcome back to the Bareface Podcast, a beauty business podcast hosted by me. My name is Eli twelve Tree. I am a beauty analyst and data science student. Well, long time no talk. Hello old friend. Golly gosh, it's been a little bit over 12 weeks since I've published an episode which is heart breaking and I didn't mean for it to happen, but it did. But we're back. I have been busy working on a baby called Unfiltered. I also had uni exams, but most of my energy is being poured into Unfiltered. Unfiltered is a software tool that we are developing to connect beauty consumers to real reviews from people that actually look and live like them. Think age, skin type, skin tone, skin concerns, curl patterns, nationalities, ethnicities, and so on and so forth. And the goal is essentially to surface all the important context that you'd want to know about a beauty review that you can't currently find. So how long someone's been using a product and how frequently, etc. And essentially we're building this mega database and that's the consumer view is this app that connects you to those reviews. And then there's a commercial view of the same data to help connect brands to demographic rich insights. Because currently the beauty industry is in this trend chasing vortex and it's mostly because of a lack of insights. And brands are moving quite quickly to jump on social media trends by looking at data sources like social media listening tools and search growth that flattens every shopper to the same statistic. That means brands are consistently launching into busy categories rather than serving true white spaces. And should they be successful in actually going viral, it makes for a really inconsistent and unreliable revenue model. So we're starting to see some of the repercussions of that business model. With business stories like Olaplex continuing to struggle and now Drunk Elephant with their poor sales performance causing Shiseido to have maths layoffs in the U.S. but long story short is we've just kicked off the development of Unfiltered. It's being built to get beauty consumer voices into boardrooms and help brands start to personalize their offering as the current beauty model just simply doesn't work. I wrote a piece about what we're building over on Substack if you're after more information, but I thought I'd just give some context as to where I've been. What's really cool about chipping away at Unfiltered is that I theorize that for the launch of the consumer app. Like who would want to sign up for a beauty review platform with no reviews? So we're actually first populating the platform with existing reviews from across the Internet, mostly Reddit, as I've found. That's where people are most honest. But what it means for this podcast is that we have a really rich database that allows us to zoom in on certain demographics to aid the telling of these beauty business stories, which is really, really cool. And today is going to be the start of that. So we're going to call it Season two, Episode one. And finally we're doing a bit of a flow on from the last episode I published on tariffs. And today we're zooming in on the Canadian beauty market. Canada, admittedly is one place that I know very little about. I tried to get a working holiday visa there in 2019, but fun. The Canadian immigration office, well, at least the part that looks after working holiday visas, closes for about two months around Christmas time. So I utilised a different part of the Great Canzuk Agreement and I went to the UK instead. But outside of that and the little reading that I did about Calgary because I was planning to work in Lake Louise, I know nothing about Canada. To me, Canada feels quite similar to New Zealand in the way that they're often overshadowed by their loud next door neighbor. They get left out of a lot of global conversations, let alone beauty conversations. And Canada is a market that I've wanted to sink my teeth into for a second, and particularly now because there's so much going on there, it feels more topical than ever. Because I am sure you are aware that their loud next door neighbor have launched a bit of a trade war and it has impacted the beauty industry in particular very significantly. And the cultural response that we've seen to this with the Made in Canada movements, which we'll touch on later, has been so loud that it just can't be ignored, which is fantastic. And to say that Canada is going through it at the moment is an understatement. But we'll see all of this when we look at beauty, because the market is just quite confusing. Home to some of the most dominant brands in the world, like Mac Cosmetics and deciem, parent company of the Ordinary. Yet you might never know that they're Canadian. And what blew my mind about researching for this episode was that despite Canada being the 10th largest economy in the world as of 2024, I could not find barely any information on Canadian beauty here. I thought that Australian beauty was quiet and globally ignored. But as we will get into this country is a global powerhouse, particularly when it comes to fueling the biggest beauty market in the world, the us. So this dynamic is so worth the deep dive and it's really worth you understanding just how we got here. So, as always, the episode will be broken down into three parts. Firstly, we will get an understanding of what the Canadian beauty retail landscape is like before part two, where we'll get a more topical view of current events impacting Canadian beauty, mainly tariffs, but also updates in regulatory bodies which are worth knowing. And then finally in part three, we'll zoom out a bit to look at Canadian beauty on a global stage. Where does it sit, what does it excel at and where are its weak points? Let's start off by getting an understanding of what it's like selling beauty in Canada. How is it similar to markets like the US and how is it different? And what does the retail landscape look like? What's really interesting right out of the gate is that beauty trends in Canada.
- [06:47]
Sam
Are not particularly unique.
- [06:50]
Eli Twelve Tree
In August of 2023, a report by Sakana, an American market research and technology company, wrote about trends as a part of their large scale research project that they did on Canadian beauty. The report references trends like the skinification of makeup and they highlight how the fastest growing segment in makeup was loops and lip care, which for me as an Aussie and a chronic TikTok user, these don't feel like revelations, which I guess is more or less the point. Canadian beauty trends for the most part are extensions of American ones. Much like Australians, Canadians consume a lot of American and British media, which influences culture and subsequently beauty trends in more ways than one. So with that understanding, you might think that selling beauty in Canada is somewhat easy, particularly if you were already operating in another area of Canzuk. So Canada Anz uk, for example. I think it's pretty common for Aussie brands to expand into the UK for the reason that the consumer is quite similar. It's quite a natural extension of an existing brand. And I would assume that would make growing a brand awareness in a new country a lot easier. And by many accounts the same could be said about Canadian beauty consumers for what we just spoke about in terms of trends. But the difference is, is that there are a very distinct set of challenges when it comes to selling in this country that makes Canada less of a natural extension for an Aussie beauty brand or a British beauty brand. And so what we first need to consider is the geography of Canada. Canada is the second largest country in the world by land area, but has a population of less than 40 million people. So serving people spread across the country is really really difficult. While most Canadians live border and most within the southern parts of three states, Ontario, Quebec and British Columbia, the physical side of the country still makes it really hard to provide a full service to as a retailer purely because it is so vast. So when we think about local retailers that have been able to dominate other western markets, the geography of a country actually has a lot to do with it and I had never thought about it until the researching for this episode. So in Australia, Mecca was able to start in Melbourne and eventually grow into Sydney. And by operating in those two cities alone, the cities were dense enough to allow Mecca to build a scalable business. Similarly in the uk, with Space NK being born in London and then being able to expand up to Manchester by being in just those two cities, they had a large enough customer base to grow as a retailer, Canada doesn't really have this same ability, because if you apply that same idea to two neighboring cities like Toronto and Montreal, which are roughly the same distance apart as Sydney and Melbourne, the same effect simply isn't possible. Firstly, Toronto and Montreal are nowhere near as tightly packed as Sydney and Melbourne, or the UK example of London and Manchester, and are instead considered sprawling metro areas. This means that a store location is far more critical and potential visitors are a lot slimmer. And then this fact blew my mind because Australian transport infrastructure is very very average, but supposedly it is a lot more developed than in Canada. So the two cities of Toronto and Montreal are a lot more car dependent, which adds another layer of complexity of being able to grow in person retail. But that doesn't really matter because what is far more significant than anything else is that people in Montreal speak a whole other language. Quebec is the most populous province in Canada, and according to Wikipedia, a class journalism over here, over 50% of people in the city of Montreal speak only French and that number jumps to nearly 64% in the Greater Montreal area. This adds a complexity and a cost for both retailers and brands operating in Canada, because in Quebec, translations into French are required on all marketing, packaging, signage and e commerce by law, and failure to do so can obviously lead to fines. So that addition of another language, that addition of French, makes for a much messier market generally when we're looking at Canada, which is then multiplied by the country's vastness. All of these factors have inhibited the local retailers from being able to grow. And then it's also decent advised others from trying because this meant that the country has largely been dominated by large scale American retailers that have the capacity and the finances to go into Canada as an extension of their American businesses, which has really weakened the beauty landscape in the country. Emily Jensen wrote for Glossy in August of 2024 that even successful American beauty retailers have not been able to get past many of these hurdles. Nordstrom announced it would close its Canadian stores in 2023 and Ultra made plans for a Canadian expansion in 2019, only to back out of those plans post Covid. But for any companies that can manage that challenging landscape, there really is a massive white space to fill because Canadian business is booming. So Karna discovered that amid pricing pressure and financial uncertainty, consumers are still investing in beauty. With sales revenue of the Canadian beauty industry growing by 19% in the first half of 2023, I apologize for not having a more timely statistic, but I'm telling you no one is reporting on Canadian beauty and it's kind of wild, but because there's no big prestige retailer, it's drugstores for the most part that dominate beauty shopping. There's Shoppers Drug Mart, which is called Pharma Prix in Quebec that has more than 1300 stores across the country and it does carry a mix of affordable and high end brands, but it is a drugstore. So what's really wild, at least to me when we look at the Canadian beauty retail landscape is how because of the lack of specialty retailers, beauty consumers that are after more luxury and prestige have been forced to go to none other than department stores. Which just blows my mind. It feels extremely dated. Although in those two episodes of this podcast I did where we looked at the British beauty landscape, we zoomed in on the uk. Several department store chains were betting big on beauty as a core part of their growth strategy. But department stores in Canada tell a drastically different story. Canada's largest department store chain is called Hudson's Bay, supposedly shortened to the Bay by locals and it was founded in, I kid you not, 1670. The company is 355 years old. It's the oldest company in all of North America. The parent company of this department store is Hudson's Bay holdings hbc, which also owns Saks Fifth Avenue, which is a luxury department stores with locations primarily in the US and then also Saks Off Fifth, which is an off price retailer chain of Saks Fifth Avenue. Collectively the holding company operates approximately 42 million square feet of retail estate across North America. Well it used to because HBC have been having major problems and are currently going through liquidation having reported total life liabilities of roughly 950 million that went to landlords, suppliers, banks and government entities. HBC announced that they would be closing 74 out of 80 Hudson's Bay stores, two out of three Saks Fifth Avenue stores and all 13 Saks off Fifth stores. The liquidation commenced on March 24th of this year 2025 and all the stores were expected to shut June 15th, 2025. The company had planned to keep the remaining six Hudson's Bay stores open while they looked for a buyer until the liquidation started and they couldn't manage. So they had to re announce that they would be closing every single Hudson's Bay store. They would not be saving a single door. This is the oldest company in all of North America. Neater and remind you. But in a court application Hudson's base said that the reason for its struggles is due to the drop in store traffic post pandemic, people were spending way less and the trade tensions between Canada and the US were also negatively impacting the company. And you would think that there would have been steps that could have been taken to not go out so incredibly quickly, like 80 stores, 80 from 80. And there has to have been some pretty poor planning or financial decisions made. But it does say a lot about the market. The oldest company in North America was not able to keep its head above water in the Canadian retail landscape. Like that is insane. This is not a direct comparison to why local beauty retailer hasn't been able to take off. It does provide a pretty crazy snapshot into just how volatile Canadian retailing is particularly particularly at this present moment. So the largest department store has gone into liquidation, Ulta couldn't pull off its Canadian expansion plans and no local retailer has ever worked. Then what retailers have worked? Because as we have very much clarified, Canadian beauty is growing steadily. So where is the money being spent? And the answer for prestige beauty is Sephora. 25% of Sephora's top volume doors are in Canada. Sephora has over 100 stores in Canada, which is incredible for all the reasons we just described. Something I think that's really interesting about Sephora Canada is how little it's been localized. It is by and large a copy and paste of Sephora US but with a smaller brand selection, a smaller product offering which Redditors have regularly expressed annoyance over, which I can empathize. As an Aussie, we struggle to get our hands on the good stuff too. But one of my favorite TikTok creators ever is Simone M. Hannah. She is a senior Data analyst at Sephora and is based in San Francisco. She has also just recently returned to TikTok after nearly a year of not posting about it, but she has what used to be my dream role until I started doing whatever you call this. Roles as a data analyst and beauty are not only extremely few and far between, you rarely get to see behind the curtain. Which is why I love the following Simone and she does day in the life where she walks through what her role looks like. And one thing I always thought was really interesting was how she's obviously not able to give much away. But for Simone she would talk about how her work is always split across Sephora US and Sephora Canada with little delineation and when she timestamps her TikTok videos she'll just jump between the two or be like a snapshot for Sephora Canada or something like that. Which I remember when I first started watching her videos really stood out to me because for beauty retail this is really unheard of. But it does help to explain why Sephora has been able to be successful in Canada. Because by sharing resources, by sharing a team based in sf, by sharing facilities, you have huge cost efficiencies all across the business, which by the sounds of it are necessities that you need to survive in the Canadian market, like the French translations, bilingual staff and widespread store placements. And if you need to be LVMH owned to survive in this landscape, it starts to make it apparent why it's really hard for Canadian beauty brands to get off the ground. Because if the only retailer you can get into for sales is Sephora, the biggest beauty retailer in the world, at least by web traffic, as consumers become less and less interested in buying direct, literally, how can Canadian beauty brands compete? How can they get on a global stage? This is what we're going to look at in part two. Let's now look at what it's like to sell beauty in Canada as though we're a brand. Who were the major regulatory bodies? What do they enforce? And then can we use that to get an idea of the supply chain by looking at Canada's imports and exports before addressing the Trump sized elephant in the room, AKA these tariffs. So Cosmetics Alliance Canada, or abbreviated to CA for some reason not cac, is a trade association representing the cosmetics and personal care products industry in Canada. And in 2022 they embarked on a new regulatory regime and the President and CEO Darren Prasnik spoke to Healthcare Outlook about it. The regulatory initiative is titled the Self Care Framework and the goal was to enable innovation with their network of trade agreements trying to make Canada an attractive place to develop and manufacture cosmetic products for export around the world. Essentially, they operate as a collective, almost union, who come together to work with the government to implement policies that aid the production of beauty and personal care products, rather than each trying to fight these battles alone. And so this idea behind the self care framework was in a response to the current Health Canada regulatory system, where it consisted of these three convoluted frameworks of product regulation, cosmetic, drug and natural health, which was originally established back in the 1950s. This was making cosmetic claims really, really difficult to get approval in Canada, and therefore costly, because it was stifling innovation and further reducing the appeal of doing business in Canada as a beauty brand. Darren Prasnik used the example of an SPF lipstick, where if it was a mineral sunscreen, it would be regulated under natural health, and a chemical sunscreen is regulated as a drug. That means that brands are decentivized from doing anything good, like including SPF in a product. SPF is a tricky one because of course, it should be properly regulated. We have a similar problem here in Australia, where sunscreens are considered a therapeutic good over a cosmetic, which means that influencers are not allowed to be paid to promote an spf, but they can be paid to promote a tanning product. Well, this was definitely the case in 2023. I believe it still is the case. And obviously that is a weird thing to enforce. But why try and promote the manufacturing and creation of beauty products in Canada? The goal was to streamline the process of getting approval to go to market, to create a better environment for innovation, so that Canada could become a key market for beauty manufacturing. And that would be huge for the country, for obvious reasons. But they have the ability to be a destination for cosmetics manufacturing because they already have an access to a lot of natural resources. Canada provides a variety of raw materials for the beauty industry globally at present, including natural waxes and butters and oils and essential oils, and could be potentially really impactful for the country economically. Because on top of this, another thing that makes Canada really appealing as a potential place to create cosmetics is the number of countries that have trade agreements with Canada. Of course, now in 2025, that gets a bit hazier. But in 2022, when this regulatory reform was first put into place, they describe the incredible competitive advantage that Canada has with a tariff free access to Trans Pacific Partnership countries, which is a free trade agreement between Canada and 10 other countries in the Indo Pacific. So Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. And this is still accurate in 2020. 5. Canada also has a free trade agreement with the EU and has also signed a tariff free agreement with the UK Brexit. So all of these agreements were priming Canada to become a place for cosmetics manufacturing. But the kicker is of course, the change in the agreement that Canada has with the US. So, since 10 July in 2025, the US has imposed a 35% tariff on non CUSMA. That is an acronym, that is not a word. CUSMA non Kuzma compliant goods imported from Canada, where the US raised their 25 tariff that was enforced on March 13 to 35%, while Canada has maintained its original reciprocal tariff of 25%. The loophole here is the KUZMA or the CUSMA compliant goods. So KUZMA stands for Canada, United States and Mexico Agreement and was the largest free trade region in the world, which is largely responsible to propelling North America to the economic powerhouse that it is at present. So for a beauty product to be Kuzma eligible, therefore tariff free, it needs to pass three things. It has to be wholly obtained or produced in Canada or Mexico or the us or substantially transformed within those countries with qualifying inputs, and it meets a specific rule of origin for its product category. Basically, it's really, really, really hard for a product to actually be Kuzma compliant because it is effectively impossible for one region in the world to produce everything that is needed to go into a skincare product, for instance, as we have lived and operated in a global supply chain for decades. But anyway, I won't beat a dead horse because we spoke about that in the last episode, but this tariff kerfal has undone all the work of the cosmetics alliance in Canada and all the work that had been done in trying to make Canada a destination for manufacturing, because it is now one of the worst places in the world to be exporting beauty products as the largest beauty importer in the world is charging them with some of the highest tariffs in the world. Absurd, Absurd, absurd, absurd. But this is where it starts to get kind of funky in terms of the comms and PR piece of all of this. Because what this tariff nightmare has created is it's forced people really to sharpen up on their definitions of terms like.
- [26:06]
Sam
Canadian owned versus Canadian made.
- [26:09]
Eli Twelve Tree
For instance, founder of nudestex, Taylor Frankel, who is the ultimate cool girl. And as a side note also really interestingly, her mom is actually the founder of COVID fx, a makeup brand that was wildly popular in the mid to late 2010s. Should you have been on YouTube at the time? I am sure you remember their like highlighter dew drop things, but this was in the time of highlighter. They were the COVID effects drops that would give you these like blinding cheekbones. But anyway, Nude Stix is a Canadian beauty brand and Taylor posted this video about Canadian tariffs a few weeks ago on TikTok. Take a listen.
- [26:48]
Sam
So we are a Canadian business, so.
- [26:50]
Marco Sang
Our distribution center is here in Toronto.
- [26:53]
Sam
Canada, but we manufacture most of our.
- [26:56]
Marco Sang
Products, let's say 90% of our products in Korea.
- [27:01]
Eli Twelve Tree
Interesting, right? Because they're a Canadian business with distribution in Toronto, but she states that they manufacture 90% of their products in Korea. So by being Canadian, nude sticks are in a slightly better position than a U.S. business as Canada has a free trade agreement with Korea. Because if nude sticks were a US based business, they would now have to pay a reciprocal tariff that South Korea has now imposed back on the States. But Korea and Canada don't have this hostility. So nude sticks don't have to pay a tariff to Korea to import their products into Canada, but they then do need to pay the 35% tariff on all of their products that they then export to the US this of course has been a nightmare for brands and they have done their best to be vocal about that. And as a response there has been this huge buy Canadian beauty movement. But this difference between Canadian owned and Canadian made brand is where it gets a little bit blurry about which brands are included in this business of fashion. Reported on this buy in Canada beauty movement and explained that after only a few hours of the tariffs first being imposed, a WhatsApp group of Canadian beauty businesses sprung into action. And within two days they had formed the Shop Canadian indie beauty collective, a website listing domestic offerings from sustainable body care brand Everest to clean skincare label. Great on the 20 brand founder members that came together to do this contributed funds to set up a collective website and interestingly, they also hired a publicist to promote it within Canada. I think it's really interesting that they collectively were like, we need help publicizing this because there's not much global attention given towards Canadian beauty. But where this gets a little bit funny, particularly on Reddit, is that like the focus is on supporting Canadian businesses to keep the money in Canada. So if a business is simply Canadian owned, is that enough to be able to ride off the coattails of this movement? I'm not sure where I stand, but what I do know is that whether they're Canadian made or only Canadian owned, their margin is going to be hurting because when we look at where most of the finished goods so formulated, filled and packaged beauty products are exported from Canada go. They pretty much always end up in the States. According to the Observatory of economic complexity, in 2023, nearly 55% of Canada's beauty exports went to the US with their second largest importer being the UK at a mere 12%. I've included a full breakdown of the Canadian beauty exports by country in a tree diagram up on substack. And that really puts into perspective just how significant the reliance on the U.S. canadian beauty really has. But when you flip that, it's kind of wild. Because, yes, Canadian beauty is very reliant on the us but it is crazy when you consider how relatively quiet Canadian beauty is in global conversations. But it is the third largest source of beauty imports into the US which is the largest beauty market in the world. The number three, that's huge. Canada is only behind South Korea and France, two very, very loud and dominant beauty regions. So now let's look at why Canadian beauty is so relatively quiet on a global stage, but can also be the third biggest importer by the US the largest beauty market in the world.
- [30:39]
Sam
Part 3 the global perception of Canadian beauty. This was the last part of the Canadian beauty landscape that I really, really wanted to understand. Because the term made in Canada is something that I had never really seen or I'd heard very, very little about until this indie collective rose out of the response to tariffs.
- [30:58]
Eli Twelve Tree
And I was just like, I couldn't.
- [30:59]
Sam
Understand why that was. I thought it was likely to do with my position as an Aussie, but it turns out that that's not entirely the case. So Made in Canada is a lot smaller and less frequent than made in America. And it's not entirely to do with the country sizes. Of course, it partly is, but stick with me.
- [31:17]
Eli Twelve Tree
Canada is in a position where for.
- [31:19]
Sam
So many industries, it is. It fuels the US of these raw materials of these parts that make up a whole product, where they are then assembled in the U.S. they are. The final good is created in the U.S. a lot of the country's biggest exports are things that are not finished goods. They are raw materials, and therefore they would never be branded as made in Canada. At best, they're supplied by Canada, but who's putting that on packaging? So on a big, big scale. In 2022, natural resources accounted for 19.2% of Canada's nominal GDP. The natural resources sector is essential to the nation's prosperity. And the sector shows remarkable productivity, being 2.5 times more productive than the average Canadian industry. Natural resources was tied for second place as the industry with the highest grossing gdp tied with manufacturing and only being beaten by real estate, rental and leasing. The country also ranks fourth globally in terms of natural resource. So if we think back to the fourth episode of this podcast titled the K Beauty Boom How Korean Skincare Took over the World, we explored how South Korea has so few natural resources that they were essentially forced into becoming an industrialized manufacturing country where they have to create and export such innovative products in order to survive as a country in order to make money. Canada is essentially the complete opposite of this, which is exactly why compared to South Korea, we hear so little about made in Canada. The US has imposed tariffs, particularly on China since Donald Trump's first presidency and Biden never waived them. So these have been in place for quite some time, which has seen a lot of particularly Chinese manufacturing move to places like Mexico. But there have long been incentives to be made in America. Not to mention that the PR of it all of Made in America has been invested in so heavily by the American government because finished goods make up less of the country's gdp. Canada has not had these same movements, but as Trump puts more and more restrictions about non American made goods and does continue to incentivize manufacturing in the us There will likely be more and more of this even in non government funded PR movements. Like when you think about the racist and negative connotations of Made in China and how everything made in China is seen as cheap, the perception of made in is huge.
- [33:59]
Eli Twelve Tree
And of course the reason Trump wants.
- [34:01]
Sam
This is because it safeguards America. Because when we think about the rise of these tariffs and how Canadian exports are at major risks, perhaps more than any other country because they are so US reliant. Creating the finished good to turn around and sell it is being done in America also kind of fueling this bizarre nationalism that all the greatest stuff comes out of America without recognizing the global supply chain that's behind it. But if we look closer at beauty I asked founder of Vintage Noon, Marco Sang why he believes there are so few Canadian beauty brands leading global conversations. And Vintage Noon is a Canadian owned small business that launched in July of last year 2024. So Marco was able to provide a really interesting point of view here. Take a listen.
- [34:48]
Marco Sang
I actually think Canadian brands have led global beauty conversations. We just haven't always claimed that leadership loudly enough. I have two examples. So Mac, they really revolutionized the industry by making professional grade makeup accessible to the everyday consumer and really championing diversity and artistry long before it really became the norm. And then with deciem with the Ordinary really let the charge on ingredient transparency and pricing forcing the entire industry to rethink and rethink how products are being marketed and valued. So the innovation and leadership have always been there. I think the gap really lies more in infrastructure. Canada hasn't had the same culture, export mechanisms, venture capital, or media platforms to amplify a national beauty identity the way that other countries have. So, you know, looking at brands in the US or even right now with K Beauty.
- [35:55]
Sam
Because he's right, right? Like Mac and the Ordinary are hugely powerful companies and although they're Canadian, we don't really associate them with their Canadian identity. And in the case of the Ordinary, especially, they're proudly Canadian too. Like the brand posted twice on Instagram about the Canadian election, they're donating to Canadian charities that support mental health, climate change and climate action. They also mentioned that they're proudly Canadian on their site and in many of their press materials. But again, because the country hasn't invested in these Made in Canada campaigns, or like Marco said, there's a lot less VC investment as well. This has all led to a lot fewer brands being able to get to this scale. So there isn't much really to be gained by embedding the Canadian origins into the brand. Which really is a shame, because if we think about beauty brand messaging suites with limited resources, like when you're an indie brand particularly, you really have to be really targeted in what you're trying to communicate to the consumer. Because with every additional point that you're trying to communicate about your brand comes with the added cost of marketing efforts or comes at the sacrifice of your core messaging, which is likely more related to product benefits, ingredients, even environmental initiatives. So when Made in Canada has such limited awareness, there's often been very little to gain from incorporating Made in Canada into beauty brand identities, which so when we think about all of this as a full 360 picture, I think it becomes quite clear and quite almost upsetting why Canadian Beauty has not been given the platform that it deserves. Because of all of these complications that are in place. Because retail has been so hard historically, because Made in Canada has seen little support and has almost been certainly not demonized by Made in the US but because it is a country that fuels another one in many senses, and it fuels the US through its resources, through packaging, through raw materials. All of this has created a climate which makes it really, really hard to be a small Canadian beauty brand, to get a brand off the ground. Not to mention, of course, that scaling A beauty brand is directly tied to sales, which Canadian beauty brands are often helped by their proximity to the US So now you add in these tariffs and you've just created a dynamic which.
- [38:26]
Eli Twelve Tree
Undoes so much of the work of.
- [38:27]
Sam
The Canadian Cosmetic association that we were talking about before that we're updating all these regulatory bodies to try and make Canada an attractive place to create beauty products, that it just blows my mind that a country is powerful and as big and also just I can't get over the proximity to the U.S. i.
- [38:44]
Eli Twelve Tree
Just, I can't like the fact that.
- [38:45]
Sam
It'S the next door neighbor to the biggest beauty market in the world. And this is how tough you've got it. Like, it just it honestly, it blows my mind. When you're the ordinary or Mac, and you're working with budgets of the size of those brands, you can start to dabble in mixed messaging. You're able to add Made in Canada on a post here. You can pop it on your website, you can put it in, you know, one or two campaigns a year because you've got so much cash to fuel the more core parts of your identity. But even then, I had no idea Mac was Canadian. I think it's largely to do with the fact that they've been owned by estee Lauder since 1994, which I very much associate them with the very American roots of their parent company. But there is so much great stuff happening in this market, but the layers and layers of complexity is making it practically impossible for them, any of them, to prosper. And that brings us to the end of today's episode. This market is a crazy one. And as a consumer, I feel like I can relate to a lot of the pain points because being an Aussie, when you're experiencing brands and products online, often you can't buy into them even if you wanted to. And I imagine this is particularly frustrating when the same products are available mere kilometers away and they're like right there and they still won't let you spend your money. I imagine that's really infuriating. But we really just scraped the surface with this market in today's episode. But hopefully you learned something about Canadian Beauty. And I think that it's this market that I really want to understand because selfishly, for building unfiltered, I've spent so much time on different subreddits like Makeup Addiction Canada and understanding the not clicks, but the different communities within Beauty really, really fascinates me. And I think in many ways, by being almost excluded from the broader beauty market. It makes this, this community in particular, really, really strong. Canadians seem to be united in their frustration, so there's a real untapped opportunity here. Like I it's so poignant when you're looking at this in the detail that I have been. So I'm really hoping something like Unfiltered can enable that community, and I'm really keen to dive deeper into this market. So if you have any questions, be sure to leave them below or wherever you're listening. I'm sure that we'll circle back to this at some point, but that is all for today. Big thank you to our new podcast editor, Florence for editing this one. It's entirely due to her help and maybe a couple of others in the next few weeks, which is really exciting. That has enabled the return of this show. So huge amounts of appreciation for Florence. Truly, truly, thank you. Like I mentioned at the start, I love this show. It's just a bit too much work than I can handle alone with everything else going on. But that doesn't mean it's going anywhere. I think diving into beauty stories is something that I really enjoy and I also think there's a real appetite for. So with all that said, if you want to re reference any of the parts of today's episode, there is a full breakdown of everything we spoke about, along with accompanying graphs and things on substack. Like always, you can also create your account for Unfiltered and sign up@unfiltered bareface.com to keep in the know and support what we're trying to build. But be sure to follow and rate the show wherever you're listening, or if you're feeling really generous, share it with a friend or on your Instagram story. But until next time, I hope you have a wonderful weekend or week and we'll chat soon.