Why e.l.f. Beauty’s CFO sees marketing as a growth center

I talked with Fields on Tuesday before the company reported its quarterly earnings for the period ending Dec. 31. Net sales increased 85% to $270.9 million year over year, primarily driven by strength in both retailer and e-commerce channels. The firm’s updated outlook for fiscal 2024 reflects an expected 69% to 71% year-over-year increase in net sales, compared with a previous figure of 55% to 57%. In January, shares climbed more than 10%.

“We’re celebrating our 20th anniversary this year, and we’ve really only had two quarters in that time where we didn’t have growth,” Fields told me.

The Oakland, Calif.-based company with a huge Gen Z following, is working to court more millennials, Gen Xers, and even baby boomers, she said. For example, the brand launched a 15-minute true-crime parody documentary in January that plays ahead of Paramount Pictures’ new film Mean Girls.

Finance chiefs traditionally have viewed marketing as a cost center. But that’s not Fields’ perspective.

“We invest behind marketing to drive net sales,” Fields explained. “I always take a balanced approach. I never want to get over our skis and invest so much behind marketing that that’s at the detriment of our EBITDA margin. We expect Adjusted EBITDA margin leverage of approximately 200 basis points year over year.”

As a result of efforts in marketing, including digital channels like TikTok, e.l.f.’s brand awareness in the U.S. has doubled from 13% to 26% since 2020, she said.

Part of that marketing plan includes Super Bowl ads. Last year, the company ran its first-ever Super Bowl ad. It featured Jennifer Coolidge, who had a comical take on e.l.f.’s popular Power Grip Primer. 

“We saw 57 billion global impressions behind the Super Bowl,” Fields said. “In the two minutes after it aired, we saw 10 times the number of visitors to our website.”

Looking at those metrics, Fields said e.l.f. decided to return to the big game this year—Super Bowl LVIII—on Feb. 11 with one key difference: Last year’s ad was regional, and this year’s is national. The company declined to say what it paid for this year’s spot, but 30-second Super Bowl ads have sold for $7 million, the New York Times reported.

You can read more about this year’s commercial for the big game and what Fields said are e.l.f. Beauty’s growth drivers in the complete article. And spoiler alert: she’s rooting for the San Francisco 49ners.

Sheryl Estrada
sheryl.estrada@fortune.com

Leaderboard

Yanela Frias was promoted to EVP and CFO at Prudential Financial, Inc. (NYSE: PRU), effective March 15. Frias will succeed Ken Tanji, who will remain with the company through Sept. 30 for a transition period. Tanji joined Prudential in 1988 and has served as CFO since 2018. Frias has a nearly three-decade career with Prudential. Prior to being appointed president of Group Insurance in 2021, she served as president of Prudential Retirement. Frias spent nearly 20 years in a variety of finance roles including assistant treasurer for Prudential Financial, CFO for Individual Life Insurance, and CFO for Annuities. 

Gary Millerchip was named EVP CFO at Costco Wholesale Corporation (Nasdaq: COST), effective March 15. Millerchip will succeed Richard Galanti, who has been CFO at the company for nearly 40 years. Galanti will remain with Costco through January 2025, serving in an advisory role. Millerchip joins the company from The Kroger Co., where he served as SVP and CFO since April 2019. He spent 15 years at The Kroger Co., preceded by more than 20 years in banking, most recently with the NatWest Group (formerly Royal Bank of Scotland) in the U.K.

Big deal

The Burning Glass Institute, in partnership with the Society for Human Resource Management, released a new report on how GenAI will impact industries, companies, and jobs, and reshape the economy. The report forecasts that the industries most likely to be affected by GenAI include financial services, HR, legal and business services, writing and editing, marketing, and computer programming.

“Financial services will see the greatest impact," according to the report. Within finance, roles most exposed to GenAI disruption include personal finance advisors, financial analysts, accountants and auditors, budget analysts, insurance underwriters, credit professionals, insurance underwriters, and tax preparers. 

Going deeper

Find the AI Approach That Fits the Problem You’re Trying to Solve, a new report in Harvard Business Review, explains how knowing the right questions to ask can help you make better decisions, regardless of how fast technology changes. Without the right questions, you’ll be starting your journey in the wrong place, according to the authors. 

Overheard

“Apple’s stance is very much incongruent to our stance on the matter, and frankly, I think it’s a bit of a farce.”

—Spotify CEO Daniel Ek said during Spotify’s earnings call on Tuesday referring to Apple's compliance with new EU antitrust rules, Fortune reported. Ek had successfully pushed Europe’s antitrust regulators to require that Apple let users download iOS apps from third-party app stores. However, during the earnings call, he expressed that Apple’s subsequent changes are “a farce” that continues to harm app developers.