Stream Cosmetics, a subsidiary of Luminess Air (an established airbrush company) is claiming all sorts of things for itself. From being the first to use primers, to being the avant-garde of the airbrush world – these claims are largely embellished, but they are the first airbrush makeup company to go the way of Avon and use a home-based multi-level marketing business model.
Interested people can easily sign up with Stream Cosmetics as an Independent Beauty Consultant (IBC) for a fifty dollar fee. There is no compulsory inventory to become an IBC, but realistically the minimum purchase of a basic kit for demonstrations would be necessary in order to show potential clients the products. With the Stream Cosmetics pyramid / Multi-Level Marketing business model, consultants get between twenty and fifty percent of all sales made. They also get a percentage of any clients who they sign up for automatic monthly shipment. Auto-shipment programs are a double edged sword for any company, as they have a way of signing people up who would rather not be signed up for a monthly credit card debit and resulting in a lot of disgruntled customers.
In order to progress up the levels of the Stream Cosmetics business ladder, consultants must maintain a monthly sales average and develop a group of active IBCs “recruiting” other members underneath them. There are seven levels of progression between the bottom IBC and the top Beauty World Ambassador level (which requires a monthly group sales of $250,000!) so the potential earnings are high – if you can actually manage to get there. Of course as you progress up the pyramid there are more lucrative bonuses and incentives but the climb seems pretty steep, so it seems a bit like a stick and carrot system where consultants very rarely get the golden carrot.
The other component of the Stream Cosmetics company is of course the products being sold – and this will be the real litmus test for the company, because no matter how good the business plan, if the products aren’t good, then there is no way to build a cosmetic empire.
Their range of products is the same as that of the industry leaders, so their claims of being a revelation to the airbrush makeup world seem a little far fetched. There are reports coming in of the foundation formula being too runny, and for the price they are charging (twice that of other companies for foundation) that might be a problem for the company. As foundation is the mainstay of the airbrush makeup industry, getting the formula right is essential, so Stream Cosmetics may need to adjust their formula in order to stay abreast in the market.
Stream Cosmetics may prove to the rest of the industry that the home-based seller is the best way to market a product, but this really remains to be seen given that the company is so new.
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