The Rise and Fall of OLAPLEX? A 5-Minute Read
From hair care's darling to a stumbling giant, Olaplex's journey has been a rollercoaster ride.
Olaplex, a brand that claimed to repair chemically damaged hair, had a spectacular rise in the social media era, but also a disastrous fall. The company was launched in 2014 by Dean and Darcy Christal, a married couple who faced difficulties in marketing their bond-building serums for salon use. Their fortunes changed when they enlisted famous stylists as brand ambassadors and received endorsements from celebrities like Kim Kardashian and Drew Barrymore. Olaplex expanded its online presence in 2018 and started selling at Sephora that year and at Ulta Beauty in 2022. It also developed a consumer product line and went public on Wall Street with a dazzling debut, raising $1.5 billion.
However, the brand’s future is now in jeopardy, as it faces declining sales and a sinking stock price, as well as growing competition. In February 2023, a group of 28 women filed a lawsuit against Olaplex, accusing its products of causing hair loss, blisters and other conditions. The lawsuit also claims that Olaplex products contain lilial and panthenol - chemical compounds that can lead to hair loss and scalp irritation. Lilial was once used as a perfume in cosmetics, until the European Union banned it from March 2022 due to its impact on fertility. The lawsuit alleges that Olaplex is still selling the older products that contain lilial, also known as butylphenyl methylpropional. This sparked a backlash on social media, where many customers expressed their dissatisfaction and frustration with the brand, posting photos of their bald spots and damaged hair. As a result, Olaplex’s stock and sales have plummeted to about $4 a share, down about 80% from its listing price on Sept. 30 of $21.
(source: INSIDER)
Despite the challenges, Olaplex remains optimistic about its future. The company is not giving up and is taking proactive steps to address the issues. Olaplex has hired a new chief marketing officer, Jennifer Mullinax, to help lead the company’s turnaround efforts. In addition to increasing its marketing budget, Olaplex is also introducing new products, including a shampoo and conditioner line that features the same bond-building technology as its popular salon treatments. The company is hoping that these new offerings will help it regain the trust of consumers and restore its reputation in the hair care industry.
The company's CEO, JuE Wong, announced that 2023 would be a "reset year." The brand has nearly doubled its marketing budget to create an awareness campaign that includes billboard advertising, boots on the ground at Sephora and Ulta Beauty, and a rapid-response approach to social media. Wong said, "We want to correct misinformation more vocally and faster."
(Source: OLAPLEX Instagram page)
Only time will tell if Olaplex’s efforts will pay off, but the company is determined to rise from its current slump and come back stronger than ever. As JuE Wong said, “We’re not going to let a few bumps in the road stop us. We’re going to keep moving forward and doing everything we can to make our products the best they can be.”
The story of Olaplex serves as a cautionary tale for other companies looking to make it big in the competitive world of social media. While the fast-paced nature of platforms like TikTok can lead to rapid success, it can also lead to just as rapid of a downfall if not managed carefully.