The one thing nearly all successful businesses have in common is they offer a solution to a widespread problem. For e.l.f. Beauty, this problem was the availability and affordability of quality makeup products. Through brand building, consumer feedback loop development and sound financial leadership from their CFO Mandy Fields — who has been with the company since 2019 — the company has thrived in its mission to sell affordable cosmetics at scale.
From March 2023 to March 2024, e.l.f. Beauty delivered more than $1 billion in sales, up 77% over the past fiscal year. They have reported 21 consecutive quarters of sales growth while making significant changes to their supply chains, including eliminating nearly all product sourcing from China last year. Not only have they garnered billions of views on their social media platforms, but the company’s market cap is fast approaching $10 billion.
The company has an interesting track record of brand development via consumer feedback. This approach includes one of the first successful makeup how-to blogs on the internet in the early days of the company — predating today’s YouTube influencers who have developed incredibly successful followings and careers by sharing makeup and beauty tutorials.
The company was a pioneer in developing a community for those interested in cosmetics and has now created a formula on how companies, and their finance leaders, can leverage strategic marketing and transparency together to perpetuate growth.
Mandy Fields
CFO, e.l.f. Beauty
- First CFO position: 2016
- Notable previous employers:
- BevMo!
- Albertsons
- Safeway
- Gap
- J.P. Morgan
This interview has been edited for brevity and clarity.
ADAM ZAKI: Early in your career, you worked for Gap as an FP&A analyst after just over two years at J.P. Morgan as an investment banking analyst. At that stage, many people would’ve stayed at a company like J.P. Morgan and followed the investment banking track. What made you make a move to leave?
MANDY FIELDS: Going into investment banking was a big decision for me. When I was a kid, I was really into numbers. I had a knack for them. When I was 10 or 11 years old, I used to sit down with my mom and do our family budget with her. It was always the highlight of my week as a kid and it introduced me to the world of finance and accounting at a young age.
So, I went through college on the finance track, and by the time I graduated there were sort of two paths I could take; the accounting route and the finance route. I knew I wanted to do the finance route, which is what brought me to investment banking at first. When I got there, I was working for clients in the oil and gas industry. I found out I loved the financial pieces of my job, just not the industry I was working in.
“When I was 10 or 11 years old, I used to sit down with my mom and do our family budget with her. It was always the highlight of my week as a kid and it introduced me to the world of finance and accounting at a young age.”
Mandy Fields
CFO, e.l.f. Beauty
I wanted to switch to consumer brands. I then met my future husband in New York City around that time who ended up relocating out to the Bay Area in California. I followed my heart and went with him, and saw that as the opportunity to move into the consumer side of things, and that’s when I took the role at Gap and began working within an industry I was, and still am, passionate about.
After Gap, you moved around industries quite a bit. You worked for two large grocery chains and then a beverage company in your first CFO role. Looking back now, how has that variety of experiences helped you?
FIELDS: It has helped me tremendously. Diversity of experience is super important to me. From the banking side of my career, I got valuable experience whether it’s working on M&A deals and evaluating strategic targets for example, it’s those types of things I learned early on that have helped me throughout my career.
Safeway’s private portfolio has hundreds of different brands, many of which involved things I had never experienced before. It’s the same thing in cosmetics. I have learned so many different things in how we do things from the retailer side, and the [consumer packaged goods] side of the business for example. Experience has been so valuable to me and I love the opportunity to continue learning here at e.l.f.
e.l.f. is a creative company with fun marketing tactics. As you know, CFOs must often be the realists in the room when it comes to marketing costs. How do you balance embodying a company culture of creativity, especially in marketing where you’ve seen lots of success, while also being the skeptic that CFOs are often tasked with being?
FIELDS: For me, I’ve always thought of my role as being a partner. I am not necessarily a skeptic. When I came to e.l.f., it was an opportunity for me to come in and set a different tone, reset expectations and all of the things that come with leadership change. And a part of those changes was creating an ability to invest in marketing and digital, something we hadn’t done before my arrival. Maybe we invested 7% of our net sales behind marketing and digital, whereas now we are doing between 24% and 26%.
We have stepped this up since I’ve come on board. I talk about our flywheel a lot internally. We invest behind marketing to drive top-line sales. That allows us to leverage our cost cases to drive EBITDA margin expansion.
I think about marketing differently. I think a lot of CFOs think marketing is just an investment or a cost center. I believe it helps drive sales when you have the right recipe and the right chief marketing officer (CMO) who has the right ideas in play. It can drive a lot of sales growth as we have shown.
You have developed an incredible feedback loop through social media with your consumers. As data quality is something many CFOs struggle with, how has this communication and brand development improved your data quality when it comes to financial decision-making?
FIELDS: Our efforts to develop a feedback loop have been very successful, and the entire leadership team has an active part in it. Me and my CMO will go on TikTok live and we will take questions from our followers. What are they looking for, and what can we do as an organization to help address what they are looking for in our products?
For example, our new bronzing drops, which we just launched this summer, were an idea developed off a consumer request. But from a finance standpoint, it helps us develop data around where our consumer interest is and what types of products they have an appetite for.
“I think about marketing differently. I think a lot of CFOs think marketing is just an investment or a cost center. I believe it helps drive sales when you have the right recipe and the right CMO who has the right ideas in play.”
Mandy Fields
CFO, e.l.f. Beauty
This is one of the holy grails at our company, we say, because it helps us understand what might take off within our community, and that helps us get to market a little faster and help build demand for that product before launch.
Your company is regarded as one of the most successful marketers to Gen Z. What is the secret sauce to this, and as your employee base grows with members of this generation, how do those marketing strategies influence your internal development and retention strategies of the future?
FIELDS: From a consumer and an employee standpoint, we believe Gen Z is looking for authenticity. They want to know who they’re talking to. I always say I am one of the only CFOs you can find talking on TikTok or a Twitch gaming channel about their company’s product. We try to be true to our mission with respect to both things you mention, by making the best of beauty accessible, and that means making our executives accessible too, both internally and externally.
That’s also how we’ve been able to attract good talent. Our people know they have direct lines to the decision-makers at the company. It’s how our community relates to us, and it’s open and authentic and we truly listen. It’s in the roots of the company, and I think that’s important when it comes to younger generations and their perception of an organization.
You mentioned your mission — making beauty accessible at a low cost. With inflation, global supply chain uncertainty, rising costs of raw materials and the array of other economic concerns of the future that may impact your business, how do you plan to stay true to this mission?
FIELDS: I think we are built to last. We started out, before my time here, selling makeup on the internet for a dollar. Some people thought it would be impossible, but at the time the company found a way to do it, and we continue to maintain a major price gap between us and our competition ever since. On average, our products are around $6 when our competitors are closer to $9 or $10. Prestige brands and products can go over $20 on average.
“We believe Gen Z is looking for authenticity. They want to know who they’re talking to. I always say I am one of the only CFOs you can find talking on TikTok or a Twitch gaming channel about their company’s product.”
Mandy Fields
CFO, e.l.f. Beauty
We’ve also introduced products that are at a $10-$14 price point, to which our competitors are closer to $50 for the same type of product. So, we can incorporate products at different price points, which helps us hedge against changes that could impact one part of the business. It gives us a better value proposition that we can deliver to our community this way.
In 2022, we were super transparent, and we did our second price increase in the company’s history due to macroeconomic factors as you mentioned. We told our customers there is cost inflation impacting our business, and communicated that across our communities and social media channels. We saw our consumers’ appreciation for the heads-up, and we saw less of an impact than we may have seen if we didn’t prioritize transparency during the process. It goes back to the essence of everything we do.
