Honest.com HAS GONE PUBLIC. This is the latest e-commerce pure player to go public and it’s always a good idea to see what companies like Honest.com are doing to try and get ideas and analyze these businesses that really make a dent in the space with a big consumer base. While Honest sells to retailers like Amazon.com, Costco, Target, and Walmart, the bulk of these products are really being sold online.
Some things to note about Honest.com:
- The Honest Company (HNST) debuted strong on Wall Street Wednesday morning. With shares rising nearly 44%, the consumer goods brand founded by actress Jessica Alba is now valued at $2.68 billion. Alba founded the brand in 2011 with the mission of democratizing clean living.
- The Honest Company has raised more than $530 million over seven rounds of funding. Positioned as a provider of eco-friendly and natural baby products and home goods.
- Honest had grown from $10 million in sales to an estimated $250 million in 2015.
- The Honest Company has been unable to turn a profit so far, though it was close in 2020. Revenue grew 28% year-over-year (YoY) in 2020 and Core Earnings improved from -$26 million to -$2 million.
- Honest outsources the manufacturing of its products. Honest baby wipes are made in China, along with its dish towels and diaper caddies. The company’s diapers are made by a U.S.-based company at a plant in Mexico.
- Honest products are not 100% natural–they all contain a variety of synthetics, although for the most part these are synthetics that seem to be safe. Some ingredients don’t have any safety data available (sodium lauroyl oat amino acid, for instance). SNEAKY: Honest Hand Wash contains phenoxyethanol.
- The Honest Company utilizes an omni-channel approach that saw revenue split 55% from digital sales and 45% from retail sales in 2020.
The thing most notable about this retailer and why it created such a strong brand is because it had a CLEAR mission and message. SELL CLEAN PRODUCTS. The company was founded by Alba in 2012. The brand was created after the actress struggled to find clean products and saw allergic reactions to several products due to a large number of ingredients in them. This is important for all those retailers when it comes to marketing and conveying a message, moreso growing a brand. This has been the mission since day one and resonated with a large community that helped make this business successful.
Let’s look at a few factors on HONEST.com.