By Ruth Reader. Source: Fast Company.
Actress Jessica Alba sat down with Fast Company Monday to discuss what’s next for the company she cofounded, Honest Company, which markets and develops nontoxic baby, personal care, and household products. The brand grew out of concern, while pregnant in 2008, about the safety of all the baby shower gifts she was getting. It is now a 400-person company valued at $1.7 billion that, like any that scales rapidly, is having growing pains. Recently, it underwent a major reorganization with 80 layoffs and the hiring of a new CEO—Nick Vlahos, a former Clorox executive—to help drive Honest’s next phase.
Fast Company chatted with Alba before her appearance at an American Express “Success Makers” event that included another innovative company’s founder—Warby Parker CEO Neil Blumenthal.
Fast Company: Honest Co. has been through a lot of changes and restructuring in the last year—how have you handled that?
Jessica Alba: It’s kind of like having kids. You never really know what you’re in for until you’re in it and every day is different. The thing that I always try to do in life is work from those experiences and evolve. It’s been this journey as an entrepreneur—and tremendously exciting. The life lessons I’ve learned along the way have made me a more diverse person … and I have a depth that I just didn’t have prior to starting this company. I mean even just going to work every day and being around the same people for the last five years. That in of itself is something that I just never experienced before in entertainment. So it’s been really cool.
JA: We want to transform from a primarily ecomm distribution model to a more omni-channel one. I always wanted the Honest Company to be a brand that is global and … having Nicholas join our team is going to make that more of a reality. His background is incredible, having worked with Burt’s Bees and then obviously having the experience overseeing so many different brands at Clorox. We’re all scrappy entrepreneurs learning as we’re going. It’s nice to have his leadership in place. It’s really cool.
FC: Is an IPO on the table?
JA: I never want to talk about that part of the business. I really stay focused on the day-to-day and how to deliver the best experience for the consumer and how to really evolve the brand. From our distribution to the product offerings to pushing our R&D innovation team to deliver the best experience for everyone. So that’s where I like to stay focused. All the other stuff I’ll let other people talk about.
FC: Last year, Honest was criticized for having certain chemicals in some of its cleaning products. After the media reports came out, the company switched to a formula that didn’t contain this particular ingredient. Was that a response to the reports?JA: That’s completely not the case. We always look at all of our formulations and we’re always looking at more efficacious formulas. We brought in a completely new R&D team a few years ago and they’ve been formulating new formulas around each one of our categories. That was one that we really wanted to do better. We wanted more efficacious products and we wanted to expand our scent profiles and we just wanted to have more of a real positioning in cleaning and we also wanted our price points to be more accessible.
FC: You’ve said you want to make
your products available to all people—how are you handling pricing on what are traditionally more premium products?
JA: There are various degrees of premium pricing and most of that comes from economies of scale. When you’re making 10 of something, your pricing on that is going to be much higher just to get that product out the door than when you’re making 200,000. So what’s been great in our business and distribution growing to the size that it is today is that we’re now getting efficiencies in our own pricing and we’re having those economies of scale apply to our bottom line, allowing us to offer the customer more competitive pricing. That’s always been the goal and we’re always looking at ourselves and trying to refine ourselves and trying to be in people’s homes in the best way that we can. Having competitive pricing is part of that.