Natural products plug market gap

Falcone now sources as many products as she can from Australia and New Zealand to keep the company's carbon footprint down.

Nourished Life founder Irene Falcone has turned a A$100 gamble into a A$20 million empire on the back of her unwavering commitment to customers, curating with integrity and combating the copycats.

It’s said the best business ideas often involve convincing people to buy what they don’t yet know they need; in Irene Falcone’s case, that was organic, toxin-free skincare products. 

The Sydney entrepreneur established Nourished Life in 2012 on Facebook, investing just A$100 to buy 100 lip balms from the US, which she sold for three times the price. In her first year she turned over A$300,000. By the end of June 2017, revenue is set to hit A$20 million.

That revenue is generated by products such as 100% Pure Coffee Bean Caffeine Eye Cream (30ml), sold through www.nourishedlife.com.au for A$44.95. It carries a customer rating of 4.4 out of 5, has 437 reviews on the site, and is described varyingly as “subtle”, “divine” and “like heaven”, with a scent similar to popcorn. It’s the number-one selling product on the website and hundreds are shipped out to customers around Australia each week. 

She may describe herself as “daggy old Irene from the western suburbs” but Falcone is an astute operator who saw a gap in the market and charged right on through it.

When she established her site in October 2012, there was no other website in Australia where consumers could learn about and purchase organic shampoo, face creams with only natural ingredients, and mineral make-up. 

Already a prolific blogger on the topic of natural alternatives, Falcone used the site to share everything she learned about parabens, phthalates and polysorbates – fixtures in many moisturisers and synthetic fragrances, but claimed by some people to lead to fatigue, hormone disruption and other health issues. 

Falcone’s obsession was born from experience. When she was national advertising manager for Universal Pictures in Australia, Falcone was walking up some stairs at work when she felt her legs almost buckle beneath her. Rubbing moisturiser into her sore calves, she noticed the excessive and confusing list of ingredients on the tube. That day she went home and disposed of almost everything in her bathroom cabinet. “I threw out A$10,000 worth of product,” she says. 

The trouble was, the girl with the glamorous advertising job had nothing to replace them with. Falcone had decided she wanted to use only organic products on her skin, but she was having trouble finding a good enough range in Australia. 

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With the Aussie dollar almost at parity with the greenback, Falcone began importing stock from the US and UK, where there was an existing market for organic skincare. Followers of her blog, which she started in 2011, wanted the same things she did, so she packaged up serums and lotions from her desk and shipped them around Australia.

Falcone soon realised demand was exceeding the purpose and practicality of her blog, so she set up a website from which she could market and sell her products. Her first site on the Volusion e-commerce platform cost around A$100 a month in hosting fees and made enough money for her to go and build her own site in October 2012. 

As the business continued to boom, Falcone sold her house and used the A$30,000 left over after she paid off her mortgage to rent “a little place with bunk beds”, so she and her family (she has four children) could live within their means.

When the Nine Network called, asking her to speak about her blog on its morning show, she knew Nourished Life was about to take off. “My website crashed from all the traffic. I knew then, that was it,” she says. By June 2013 she was making enough money to quit her job at Universal.

Expanding rapidly 

The organic and natural beauty market has been growing at a rate of 15 per cent annually since 2011. This year, sales of organic skincare, cosmetics, perfumes and fragrances are expected to reach A$327 million, according to IBISWorld. The demand, it says, is due to increasing awareness of “the long-term damage caused by carcinogenic chemicals and artificial substances that are found in traditional … cosmetics and toiletries”. Celebrity endorsements and products, such as Australian model Miranda Kerr’s Kora range, have helped fuel demand.

“More and more people are thinking, ‘Why do I want to buy something that’s semi-natural when I can buy something that’s completely natural?’” says Falcone, who won the 2016 Telstra Business Women’s Entrepreneur Award for New South Wales. While many certified organic products are stocked in supermarkets, pharmacies and health food stores, those outlets don’t have their own blogs with countless articles with in-depth research, and testimonials from thousands of consumers.  

Falcone says it’s about the ingredients, what kind of soil the plants they come from are grown in or, in the case of Weleda, the flowers they pick for the calendula cream. 

“There’s a whole bunch of factors involved and that’s what makes it really quite special,” she says. “There’s so much thought and effort put into every ingredient, in every product, in every curation that’s on my site that it would be very, very hard for anybody to replicate.” 

Falcone says she has an internal matrix system to determine which products are safe to sell. “That’s really the secret herbs and spices as to why nobody can compete with me,” she says. “There’s a lot of factors involved.” Often a product will be 96 per cent organic, toxin-free and vegan. But it’s what’s in the remaining 4 per cent that seals the deal.

“There really is no other store in the world that I’ve seen that will turn away as many brands as I’ll turn away.” 

Mum’s the word

While women are Falcone’s biggest market, mothers in particular are her core consumer – and it’s an area she’s very passionate about. “Often the first time a woman really starts to think about what she’s putting in or on her body is when she’s pregnant,” she says. 

Falcone employs local mums to do her “picking and packing” for Nourished Life, to reinject profit back into the local community. 

“These mums wouldn’t normally be able to work because they have to leave at 2.30pm to pick up the kids from school,” says Falcone, who insists none of her staff ever miss an event at their child’s school. 

Women also like to share information and Nourished Life, which has 180,000 Facebook followers and 61,600 on Instagram, publishes customer reviews of all its products – good and bad. There are currently 34,909 product reviews on the site and popular products regularly sell out. Members are able to join a waiting list to be alerted when new stock hits.

It’s her customers who essentially drive the business, says Falcone. “I’ve said it before and I’ll say it again – when you tell me what you want, I race out and do it!” she posted recently (she still writes her own blogs, with the help of an intern). “I’ve had so many requests for pure clay facial masks, so here they are.”

Such contact is crucial. “I spend most of my time talking to customers and being on social media and interacting with them, which I think is the main difference between me and other CEOs,” says Falcone, who often posts candid photos of herself online and is honest with her followers. 

Irene Falcone“I find that the people that have the best influence on me are my customers,” she says. “They’re my investors and my advisers.” 

It was a customer who alerted Falcone to the plight of silkworms involved in the production of silk pillowcases, which are popular beauty items for preventing wrinkles and promoting shiny hair. Falcone did some research and found a community in India that makes pillowcases from silk harvested from hatched cocoons, so the silkworm pupae are not killed. She now sells the silk pillowcases on her site for A$64.95. 

Last year, Falcone launched her own line, Life Basics by Nourished Life, an affordable range of clay masks, nail polishes and 100 per cent natural perfumes that are now among her highest selling products. 

One reason for doing that was to arm herself against copycats: each time she discovered and stocked a new brand on her site, it would appear in competitor stores. 

“I’ve just spent four months researching and getting scientists to look over these ingredients and visiting farms and suppliers. I’m not here to pick brands for other shops to sell,” she says emphatically.

Falcone admits it’s impossible to compete with big discount retailers such as Priceline and Catch of the Day, but the sheer volume of product sold through Nourished Life does let her offer competitive prices. 

“There’s an element of my customers that support me and love what I do, but at the end of the day they’re not going to pay more to buy it from me, no matter how loyal they are,” she says. “I ship free and they get loyalty points that they can redeem. I don’t let anyone have a reason to shop anywhere else.” 

She’s not particularly worried about the arrival in Australia of Amazon which, as a comparison, is selling the 30ml 100% Pure Coffee Bean Caffeine Eye Cream for US$25 plus shipping. 

“I wouldn’t be able to offer people 40 per cent off or 15 per cent off the whole store, which is what I’m doing now, without volume. So I’ve got a lot of orders coming through. A lot. The profits are there because of the volume,” Falcone explains. 

She is confident Nourished Life can build its turnover to A$100 million in five years’ time.

Caring for the environment 

Falcone started the business with one concern: “Mums wanting to go shopping and not put chemicals on their bodies and their children’s bodies.” Five years on, however, the brand has evolved into a much larger beast, with a social and environmental conscience. 

These days, Falcone is just as passionate about the environment as she is about women. She works closely with the National Toxics Network and Global Green Tag to ensure the items she sells meet her strict standards.

National Toxics Network is a community-based network working across Australia, New Zealand and the South Pacific, while Global Green Tag is a global certification standards body recognised in more than 70 other countries.

“Those two organisations have had a huge influence on me and have taught me more about the overall lifetime or global impact a product has on the earth and the planet rather than just our own bodies,” she says. “I’ve become more aware of the fact that how we vote with our dollar impacts people’s lives and communities, locally and globally.” 

Falcone now sources as many products as she can from Australia and New Zealand to keep the company’s carbon footprint down. In the beginning, 60-70 per cent of her products came from overseas. Now it’s closer to 30 per cent. 

While skincare was where Nourished Life began, it now operates in a number of retail categories, including health and fitness (magnesium powder and herbal teas), house (reusable produce bags, glass water bottles, the Life Basics 100% Peace Mulberry Silk pillowcases), and products for children (toothpaste, cough syrup and insect repellent).

The company is also soon to launch water bottles that ping your phone to remind you to have a drink. 

One market Nourished Life hasn’t cracked is men, but it doesn’t faze Falcone in the slightest. “I learned from working in the movie industry that you can open a movie and be a box office sensation only targeting women,” she says. “I’d worked on movies like Mamma Mia!, which had an opening weekend of A$40 million or something, and we only ever reached women. I thought, ‘Well OK, if a movie doesn’t need to reach men, then neither does my shop’.” 

Who is your favourite business thinker and why?

“There’s only one person who I think is fantastic who I really respect in retail, and that is Tony Nash [CEO of Booktopia]. He was very kind to me the first time I met him, when I was turning over nothing, and I can pick up the phone and ask him questions. [Booktopia] is an example of a true blue Aussie business that has stood the test of time against Amazon. 

“Tony has probably been the strongest influence on me in terms of truth that it can be done for nothing. He kept saying to me, ‘When I was three years into the business I was turning over the same as you’, and knowing that has always made me think, ‘Wow, I can do it’.”

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