March 02, 2015
Rodan + Fields: A Prescription for Change
by Karyn Reagan
Left: Student participants in buildOn, an inner-city education and service program, speak during a “Jobstacle Course” led by employees at Rodan + Fields’ headquarters.
Right: BuildOn students from an Oakland, California, high school were treated to a day of learning with workshops on resume writing as well as mock interviews to help them prep for job opportunities.
At Rodan + Fields, transformation is not just skin deep as they support programs helping educate underprivileged youth.
Headquarters: San Francisco
Executives: President and CEO Lori Bush; Co-Founder and Chairman Amnon Rodan
Products: Cosmetics and personal care
While at Stanford University Medical Center in the early 1980s, Dr. Katie Rodan and Dr. Kathy Fields forged a friendship for the same reasons most girls do, but they were also drawn to each other for a practical reason—there just weren’t too many women in the program. After graduation, they each started their own thriving dermatology practices, but the friendship proved lasting and together they have become recognized experts in their field, co-authored two books, and created products and companies that are now household names. “Their goal is to create products that bring the dermatological experience out of medical practice and into the hands of consumers,” says Amnon Rodan, Co-Founder and Chairman of Rodan + Fields as well as Katie’s husband.
The women’s first experience with selling products was the creation of the highly successful acne treatment product, Proactiv Solution™. Since that time, the anti-aging skincare market has grown exponentially, and Katie and Kathy researched and developed a line of products they now market through their company, Rodan + Fields. “In 2002, we created the brand and started selling the skincare line through high-end department stores,” says Rodan. “Within six months, our products caught the eye of Estée Lauder, who offered to purchase our company, so we sold it to them. But in 2007 we felt it was time to buy it back and offer the products through a different channel. Our vision was so much bigger than what traditional retail could offer.”
After studying the various marketing methods available that best served the skincare industry, the distribution channel that rose to the top was direct selling. “We bought the company back in 2007, reopened it in 2008 as a direct selling company, and it has been the best decision we’ve ever made,” says Rodan. “In our first year we did $3 million in business, and now, just six years later, we finished 2014 with $329 million in sales and 75,000 Consultants.” Rodan + Fields also has accumulated five DSA awards since 2008, including the ETHOS award for product innovation in 2014.
Seventy-five high school students from Oakland, California, affiliated with buildOn, took part in Rodan + Fields’ Jobstacle Course, a day of learning their way through the obstacle of job hunting.
A Better Way
Rodan explains that the main reason they chose direct selling was because it was, in their opinion, the best way to connect the brand with consumers. “We looked around and concluded that retail selling is about selling today and yesterday—the numbers we sold yesterday compared to the product that moved off the shelves today. But the way forward is about the combination of offline and online selling, which is social commerce,” says Rodan. “Taking that thought further, the best way to attain product exposure is through social networking. Combine that with e-commerce and the result is what we call social commerce. It is the way of the future.”
Rodan + Fields was built in the digital age as a digital company with the added consumer benefit of personal contact with a consultant from the company. “The result is a much more heartwarming experience than buying a product off the shelf,” says Rodan.
An added benefit is that most of the consultant’s activities are done online, allowing Rodan + Fields to closely track who is buying what and when. “In the retail channel, there is no efficient way of knowing who is buying product, when they are buying or how often they are purchasing,” Rodan says. “Market research and studies would have to be conducted in order to have a somewhat accurate assessment.”
“Consultants are the stars at Rodan + Fields,” he says. In tandem with the desire of the founders to change skin, they equally desire to help their consultants to build their businesses, develop personally and change lives. Rodan + Fields’ salesforce development team is led by regional and area managers, who are employees. These individuals work directly with the field, and are a vital part of the organization. Rodan says, “They are a great support to the Consultants and keep a finger on the pulse of what is happening in the field. They assist with events, training, opportunity meetings and skincare education.” Support is also offered at the most anticipated event, the annual convention, where active consultants receive product introduction, training, motivation and recognition.
To keep up with the growth of the company and advances in skin care, Rodan + Fields also employs a large team of product developers who leave no stone unturned to find the most innovative formulas possible. “To get the best efficiency out of our new products, we must search all over the globe for the highest quality and most cutting-edge ingredients,” says Rodan. “And although the team creates most of them, Katie and Kathy still approve every product that is added to our line.”
The driving force behind creating the highest quality and most efficient product line possible is the desire to help people feel better about the way they look—ultimately making a difference. “We are motivated by the necessity for our lives to matter, to make a difference in the lives of others in the brief time we are on this planet. On a physical level, the business is about improving the appearance of people’s skin, which leads to feeling better about themselves on the inside,” says Rodan. “The next level of influencing change is in our communities and being involved in the responsibility of helping others in need.”
Offering a Hand Up
|Seventy-five high school students from Oakland, California, affiliated with buildOn, took part in Rodan + Fields’ Jobstacle Course, a day of learning their way through the obstacle of job hunting.|
As a practical response to the desire to impact communities, Rodan + Fields formed a foundation at the same time they launched the company into the direct selling arena. They named the foundation Prescription for Change (PFC), and the focus is to encourage people to align with a greater purpose and with the idea of being involved in something bigger than they are.
“In September of 2014 at our annual convention we announced that the new focus of our foundation is education—it’s the great equalizer. The mission statement for the foundation is: The PFC Foundation supports students in need on their journey to becoming a prescription for change in their communities by fostering belief in themselves. At PFC we believe if you can educate people you are giving them a hand up, not just a hand out,” says Rodan. “High school dropout rates have become a national crisis. That lack of education often leads young people into a dark funnel swirling them into the prison systems. The need is most acute in poverty-stricken neighborhoods in large cities across the United States.” Rodan explains that they are very excited to have found the perfect organization with which to partner in order to make the greatest impact—buildOn.
Founded in 1992, buildOn works to break the cycle of poverty, illiteracy and low expectations through service and education. Across the nation in 62 urban high schools in seven regions, the organization runs intensive afterschool programs that support education, community service and international school-building. Kari Hayden Pendoley—the PFC’s Senior Manager, hired specifically to oversee the work of the growing Foundation—says, “The size and philosophy of the organization mirrors our own allowing us to grow together.”
“With a 92% high school graduation rate, and many going on to college, these students exemplify doing well by doing good,” she says. “To date, Rodan + Fields has supported over 71,411 buildOn program days for students in need.” A buildOn program day is measured by the dollar amount it costs for a student to be part of buildOn for one day. The current rate is $4.
Pendoley also emphasizes that the consultants are a very important part of the Foundation’s growth. “Most of our Consultants are natural social influencers, and we want them to be able to incorporate that giving aspect of themselves into their business and be celebrated for it,” she says. According to Pendoley, in the last 18 months, the Foundation has more than doubled efforts across all categories of giving, including staff, grants, donor contributions and monetary donations by Consultants. “The total grants given for 2014,” she says, “including cash and non-cash grants, exceeded $350,000.”
Fundraising in Action
In July 2014, PFC invited consultants to participate in a simple social media fundraising initiative known as Go Naked Day. “For each no-makeup selfie tweeted during that particular day, $1 was donated to buildOn,” says Pendoley. “It was a huge success and $30,000 went to support students traveling to build a school abroad.”
Another outreach event coordinated by the Foundation was what they called a Jobstacle Course. Seventy five high school students from Oakland, California, affiliated with buildOn were treated to a day of learning their way through the obstacle of job hunting. “The students were given an in-depth tour of our headquarters in San Francisco learning about the various positions that exist within a company. We also exposed them to résumé writing and held mock interviews, providing feedback on what to say, how to say it, etc., in order to help them prepare for future job opportunities,” says Pendoley. “The students thoroughly enjoyed it and were extremely appreciative.”
Five buildOn alumni, now in college, were invited to attend the annual Rodan + Fields convention for the purpose of building brand awareness for the partnership while helping the students to gain exposure to the direct selling industry along with the training and excitement that comes with such an event. Their interest was piqued and they wanted to learn more about the industry. “We put them in front of about 100 Consultant leaders. They fielded questions about buildOn and shared the impact buildOn has made in their lives,” says Pendoley. “Since the students were from five different cities, it also showcased the success buildOn has had across the country.”
At the conference, consultants also filled 800 trendy backpacks filled with supplies to give to high school students as a thank you for joining one of the buildOn programs available throughout the country. “Sometimes students require some extra motivation to attend buildOn programs. Perhaps this is due to a lack of understanding of the benefits of the program or the lure of other things vying for their time that might not be the best choice,” says Pendoley. “We had feedback from buildOn across the country about the great success of the program. We will be looking to do more to support these types of efforts on a larger scale in the future.”
The Prescription for Change Foundation has committed to partner with buildOn. “They have a presence in Canada and Rodan + Fields expanded into that country in February of this year, allowing for a seamless transition into our new market,” says Pendoley. “Education is our global platform, so as our company expands, we will continue to look for like-minded organizations to support this vision in new regions.”
Commitment to education is a priority, and if a consultant has already established a relationship with an education-based charity or discovers one in his or her community, the Foundation has a product donation and check-matching program. “Once a year eligible Consultants can support a charity that fits within the parameters we have established,” says Pendoley. “This also allows Consultants to showcase our mission through their local organizations.”
As an incentive for involvement in their communities, PFC chooses one consultant each year to receive the prestigious Prescription for Change Foundation Award. It shines a light on the work the consultants do to improve their communities and help those in need. Consultants nominate their peers, with each nominee and the award winner recognized on stage at the annual Convention Award Gala, and a donation is made in their name to support students in need.
When Pendoley discusses the many life-changing activities in which the Foundation is involved, she can’t contain her excitement. “I love our new tagline—Believe in More. Empower Change,” she says. “As the company grows, so will our commitment to impact hundreds of thousands of young lives, enabling a better legacy for them while also building one for ourselves.”
As the company and the foundation move hand in hand toward the future, Rodan says that their commitment is five-fold:
- to keep the consultants the No. 1 focus by doing the right thing in every situation the company faces;
- to never compromise the principles of integrity in business;
- to educate consultants that Rodan + Fields is not a money-making scheme but a true and honest brand;
- to make it clear that consultants are invited to join the company in order to improve their lives on every level and not just win a car or trip;
- and to let everyone know that it is never too late to change one’s life for the better.
“The heart of the brand is giving back, not just to neighboring communities, but also to our own Consultants and employees,” says Rodan. “Our desire has always been to provide education, not just a product, and that education includes whatever we can share that will improve the lives of those around us.”