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Annie Jackson is back at the helm of Credo, the US specialist beauty retailer with a focus on safe ingredients, which she co-founded in 2015 with late entrepreneur Shashi Batra. Top of her priority list? Deviating Credo and its brands from the term “clean”: what has become an easy marketing catch-all for many companies, but in reality, still means very little.
Credo made its name by introducing consumers to beauty products free from certain chemicals and additives that were potentially harmful. Today, brands of all sizes appear to offer clean products or entirely clean lines. However, recent lawsuits, including the class action complaint filed against Sephora earlier this year, underline the lack of clear standards and regulations in the clean beauty space, resulting in confusion among consumers. (Sephora responded by filing a motion to dismiss the claim and listed reasons for why “reasonable” consumers were not and would not be confused by its clean programme.)
Executives are keen to do better, but progress has lagged, as the focus on safety has been centred on short-term health impacts and not longer-term issues that could develop over time, experts say.
Credo’s approach to the concept of clean has evolved over the years, says Jackson. “Clean still elicits a response around ingredients and restricted substance lists, but, for us, it’s become more of a 360-degree approach to positive impact.” Credo’s goal is to act as a resource and to support brands on their journey to making more sustainable choices, rather than cast a label aside because their offering doesn’t align with its requirements, Jackson explains. “We’re looking at every touchpoint. If a brand has beautiful packaging and formulations, that’s great, but what are their climate goals? We want to continue raising the bar and having these conversations.”
Most beauty retailers today have clean standards, but many make assumptions based on material origins, rather than hard evidence, says Jen Novakovich, founder of The Eco Well, a beauty science communication platform and consultancy. “For example, with the bans on parabens, [some brands] use sodium benzoate instead, even though it’s more allergenic for customers,” she explains. “The [logic] is that if it’s natural, it must be better, but many of these natural ingredients have sourcing and sustainability issues.”
A lawsuit filed against Sephora demonstrates a growing propensity among consumers to challenge clean beauty claims. Better guidance and regulation is needed to support the industry’s transition to a cleaner future.
The US Federal Trade Commission will soon release the latest iteration of its Green Guides for the Use of Environmental Claims, which is designed to eliminate misleading messaging around sustainability. Novakovich predicts that the term “clean” could be included this year, as it is a “deceptive” claim that too many companies now use. The latest Green Guides could encourage brands to complete a life cycle assessment (LCA) for specific claims they make, she suggests. “That would put more onus on brands to prove their claims.”
New regulations such as the Modernization of Cosmetics Regulation Act (also known as MoCRA), coming into effect on 29 December, are also top of mind for the industry, although Jackson says that the effect should be minimal for those who have done their due diligence. “Our brands should be in a great position to substantiate where they need to be. It can be challenging for smaller labels that don’t have a huge team of people, but you shouldn’t create a brand unless you’re going to do things the right way.”
Brands should avoid villainising ingredients that aren’t considered clean, as well as using terms like “sustainable” or “recyclable”, which require clear-cut definitions, and instead focus on securing a meaningful corporate sustainability strategy within the business, advises Novakovich. “When you look at what a lot of companies are doing, it’s not meaningful because they don’t have any kind of reporting or auditing of progress year-over-year. If you want to pursue sustainability, you have to start measuring things, report them, and do things better when the information or knowledge becomes available. Companies that aren’t doing this are operating in the dark.”
Moving Credo forward
Jackson started her career at Estée Lauder Companies, moving on to become director of merchandising at Sephora and then director of brand strategy and product innovation at LVMH-owned Benefit Cosmetics, before founding Credo. Since then, Credo has grown from a single store on San Francisco’s Fillmore Street to a digital business with 15 stores, including recently opened boutiques in Venice Beach and Seattle, and counts a team of 50 across three states.
Shashi Batra, whose background was in building small businesses as well as managing and growing large brands (Sephora US’s instrumental success took a prized spot on his résumé), ran Credo until his passing in May 2017. A year later, Dawn Dobras was appointed as CEO. During her three-year tenure, Dobras installed a fragrance policy that required vendors to categorise the sources of their perfumes while encouraging them to disclose all fragrance compounds; eliminated single-use plastic items; launched in-house brand Exa; and struck a deal to roll out collections at Ulta Beauty. After she left, in June 2021, Stuart Millar took on the role — but has also now exited to pursue other ventures.
For Jackson, the time felt right to take on the CEO role herself. “In the prior stages of growth, I really wanted someone to bounce ideas off. Both [Dobras and Millar] were incredible partners, but now, we’re at a maturity and are really set up for success.”
While strong sales from customers contributed towards double-digit growth in 2023 (Jackson declined to comment on profitability or annual revenues), Credo still has to navigate a competitive market; the influence of multi-brand retail is waning, as shoppers today can buy products anywhere and are better informed thanks to the internet.
Building out Credo’s private label is another priority for Jackson, who sees it as an opportunity to experiment, innovate and set an example for others. In August 2020, Credo introduced its first-ever in-house makeup line Exa, which included an inclusive foundation featuring 43 shades and a universal primer. At the time, Credo did not stock any brands offering 40 or more shades of liquid foundation, and was looking to provide a product that filled a hole in its offerings, according to Jackson. In October 2022, Credo made its first acquisition in Boston-based competitor Follain, another clean retailer and product line.
“The whole reason we created or acquired those brands is because it came with a beautiful community of people and we really want to use those brands as a catalyst to continue innovating, [particularly] if there is an ingredient, technology or different kind of packaging that we wanted to try and use,” Jackson reflects. “I want to formulate something if someone said that it could never be formulated a certain way. We want to use our brands to be able to accomplish that.”
Coming up in May 2024 is another private-label launch, but Jackson holds back the details. What will follow next is a different category, she teases. “We have a strong complexion business with Exa, which is makeup, and with Follain, it’s an incredible grab-and-go skincare for everyone. This other brand is one that has been years in the making. We’ve been working with our estheticians on the shop floor and really understanding where we had voids in our assortment.” The goal is for consumers to “shop freely and know that the homework has been done for them”.
Going into next year, Jackson is prioritising in-person events and community activations. “In 2019, we did 300 events. We want to get back to that.” Credo can differentiate by leaning into storytelling and educating customers in an accessible but no-nonsense way, she says. “It’s about highlighting what got us excited, as merchants, about a brand. It’s not sitting on the shelf because we arbitrarily picked it. There was an element that made it absolutely right for us, and customers love to know what that is. It’s more content first, less transactional.”
Transparency is appreciated among modern consumers, who are more forgiving of brands that haven’t got it all figured out from the get-go, as long as the company has a mission and is committed to it, Jackson believes. “It’s about celebrating what [these brands] are working on. I think the customer loves information and they like being along for the ride as [they know] there’s complexity in [running a business]. There’s a lot of work to be done, and it may never truly be done, but it’s a huge motivating factor to keep everybody moving in a positive direction.”
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