Celebrity-backed brands can succeed when there is a strong connection between the celebrity, product, and audience. Research shows consumers are more likely to buy products associated with celebrities they admire. Brands like Fenty Beauty and Skims have thrived due to this emotional connection. However, not all celebrity-backed brands succeed, as seen with Honest Company closing all its stores.

Honest Company, founded by Jessica Alba, focused on creating healthy baby and household products. Despite its initial success, the company has decided to close all direct-to-consumer options. Moving forward, the brand will sell products through retailers like Walmart, Target, and Amazon. The company aims to refocus its efforts on core product categories like wipes, personal care, and diapers.

The decline in revenue for Honest Company was due to challenges in certain business segments, such as diapers and apparel. The company reported positive net income and adjusted EBITDA, with a focus on improving profit margins. By transitioning away from low-margin categories and channels, the brand hopes to drive growth and enhance profitability. Physical retail economics present a different challenge for brands used to operating primarily online.

Read more at Yahoo Finance: Big-name beauty and household brand stops direct sales