Cosmetics retailer Lush has pledged to cut the money it spends with big tech platforms by a third and redirect budgets to smaller tech orgs and open-source solutions.
The strategy is among a trio of goals announced by chief digital officer Jack Constantine on Friday, the opening day of the brand’s Lush House activation at SXSW, part of its so-called “big tech rebellion.”
Constantine, son of the retailer’s co-founders Mark and Mo Constantine, said Lush was kicking off a review of its big tech spend with the aim of identifying where it can redirect budgets to give smaller players “an opportunity to lift off the ground.”
“We're trying to use our platform to help encourage smaller tech companies, open source movements and free software movements to grow, gain momentum and fight back against the big tech conglomerate approach to what has become a dominated and saturated market,” Constantine said in an opening keynote.
The budget review encompasses both tech solutions — with Constantine naming an open-source commerce engine it invests in as an example — and advertising spend. The brand set a deadline of July 1 to wrap up the review and slash big tech spend by a third.
Constantine added that Lush spends “millions” on Google search ads to protect its bath bomb trademark, which he told Campaign US he planned to abolish.
He said Lush increased its investment in search ads after pulling away from Snapchat, TikTok and Meta’s Facebook and Instagram in November 2021.
“The spend went from social over to search, which meant we leant more on Google, which we’re not actually happy with,” he told Campaign US after his keynote address.
“We have to bid against others on our own trademark to be able to maintain it. We don’t want to do that anymore, so we are moving money off that completely as well,” he added.
He said Lush’s Google budget would be better spent “on some other great new tech innovations.”
Lush has attempted to minimize its presence and reliance on major tech firms for several years. Its decision to pull its presence from select social media in 2021 came weeks after Facebook whistleblower Frances Haugen’s claims about the dangers of profit-hungry platforms. Constantine said at the time the company would not ask customers to “meet us down a dark and dangerous alleyway.”
The British soap brand previously quit Facebook and Instagram in March 2019 after saying it was “tired of fighting with algorithms,” but reinstated its accounts nine months later.
Constantine said Friday Lush was in the process of broadening the “anti-social policy” instituted in 2021 to a wider range of platforms.
“We want to add other policies around all the big tech giants and our understanding of what we feel comfortable with as Lush — what we're willing to do, what we're not willing to do,” he said.
The results will be published in an open policy that it hopes other companies and individuals will use to navigate where to spend money on the internet.
Constantine added that Lush is open to returning to platforms it departed in 2021 should they provide evidence they are prioritizing users.
“If they change their policies, we’ll change our view on how we interact with them,” Constantine told Campaign. “If Meta comes back with an amazing approach to privacy, an approach to how to look after people’s mental health — then maybe we’ll come back.”
He said quitting the platforms “was not a huge cost” because Lush’s ad spend “has always been really low,” but added the company had witnessed an impact on its audience growth.
“It is tricky to try and navigate without using the giant tech platforms, however, we're trying to dodge our way through the giants to make our own pathway,” he said.
Constantine acknowledged in his keynote address that “you can’t exist as a business without interacting with big tech,” but said the impact to Lush’s bottom line has not been major.
“We're not going to be able to get away from everyone — unless you literally just disappear, which we don't want to do,” he said.
“But we do want to be very conscientious about what we are investing in, where we're putting our money, whether we feel comfortable and we're getting value for money, and what we could be doing instead,” he added.
Lush posted £408.7 million ($566 million) in turnover in the year ended 30 June 2021, according to its most recent financials. Its pre-tax profit grew to £29 million ($40.2 million), reversing a loss of £45 million ($62.3 million) in the previous year. Lush bought out its U.S. partner in the same year to boost revenue.
Elsewhere, Lush has initiated a new strategy to redirect customers who visit its website to check out on its app or in-store, where it believes it can deliver a better customer experience.
“Some of the web-based stuff is not as customer-friendly as it could be and it's not necessarily where we want to invest our energies as a brand and as a company,” Constantine said. “We want to invest in the human element of what technology can represent.”
When customers check out on Lush’s website, they will be served a pop-up advising them to either download the company’s app or call a local store.
“If you give us a ring that's a human on the end of the phone, they can have a conversation with you and give exactly that same Lush customer experience. And with apps, there's just way more capability for us to create and encourage amazing customer experiences,” Constantine said