Minneapolis-Based dpHUE Sunsets Local Retail to Focus on National Growth
Founded on a mission to rethink home hair color, Minneapolis-based dpHUE is now rethinking retail. After July 19, the company will stop selling hair products to customers from its Linden Hills based headquarters to focus on national distribution channels.
The change, while disappointing to a core group of local loyalists, has been long in coming, says founder and CEO Donna Pohlad.
“The brand went through a tremendous pivot in 2016, but we didn’t want to abandon our local customers,” Pohlad says. “So it’s been a staged approach.”
DpHUE launched in in 2011 with a Maple Grove store that sold custom home hair color kits intended to bridge the gap between drug store hair color and salon services. In the early years, dpHUE’s styling staff offered in-store color services for customers reluctant to do it themselves, but that side of the business never took off, even when dpHUE opened a second location at 50th & France in Edina. Meanwhile, the take-home color products were a hit with local customers but the customized approach proved tough to scale. The breakthrough happened in 2014: dpHUE introduced an Apple Cider Vinegar hair rinse that caught fire, bringing national buzz and interest from national retailers. “It was something (national retailers) could get their arms around,” Pohland says. “They couldn’t get their arms around all-over hair color.”
So dpHUE shifted its focus from home hair color to hair care products intended to maintain color between appointments. That includes root touch-up kits, finishing gloss, and pigmented shampoo and conditioner. In 2016, the re-tooled brand got its big break, launching in Ulta beauty stores nationwide and Sephora.com. The privately held company does not release sales figures, but Pohlad says sales have more than doubled in the past year, prompting market research firm NPD Group to name dpHUE one of the fastest growing prestige hair care brands. Ulta has increased dpHUE’s shelf presence to 1,200 stores around the country. The brand is also sold through Nordstrom.com, HSN, and salons.
To keep up with the demand of becoming a consumer product brand, Pohlad brought on president and chief operating officer Martin Okner, a former Revlon executive. dpHUE’s new Los Angeles-based chief marketing officer comes from Estee Lauder.
Meanwhile, dpHUE shuttered its two salon/shops and opened offices in Linden Hills with a retail area where some of its earliest customers still showed up to buy custom color kits, which weren’t sold anywhere else.
“We were really sending two different messages,” says Maddie Persuitti, vice president of sales. “Nationally, it was root touch up kits and gloss. Locally, it was so customized and personalized.”
In an email to Twin Cities customers, dpHUE explained the shift away from customization. “We know that the home hair color kits that we sell in Minneapolis are treasured by our customers here, however maintaining our retail location no longer fits with our business model.”
But dpHUE isn’t abandoning its earliest fans. The company will continue to make custom kits available to existing clients only online at dphue.com.
“We don’t want to abandon our local community, or professional stylists,” Pohlad says. To that end, dpHUE plans to maintain its industry app, which makes it possible for independent hair stylists to order dpHUE products for customers with a 35 percent stylist commission.
Pohlad says dpHUE will stay in its highly visible gray and orange headquarters building at 44th and France on the border of Minneapolis and Edina. Ten employees work out of the space, which is used for operations as well as distribution. The other half of dpHUE’s team is based in Los Angeles where the company maintains the “dpHUE House,” an invitation-only salon for celebrities and social media influencers to experience the product line. “It’s about creating long-term relationships with people who enjoy making content,” Persuitti says.
The toughest part of shutting down retail at headquarters, Persuitti says, is losing that touchpoint with consumers. “But we’ll have those conversations and connections through Instagram, our website, other stylists,” she says. ”I don’t think we’ll lose that personalization.”