Lip balm does not seem like an exciting industry that involves a significant amount of change. However it is just that view that left the industry open to being overturned and disrupted by a new market entrant.
EOS lip balm started out as an idea by founders who had experience working for brands like Pepsi and Unilever and who were looking for an industry to disrupt. The lip balm industry seemed ripe given that the major companies in the industry hadn’t innovated their product lines in many years and did not have diversified and specialized products that met the needs of certain niche customers.
The largest niche market for lip balm was women who were not at all excited about the major lip balm options in the market. The available flavors were boring and medicinal in flavor and not exciting to those who were buying them. Many women and consumers in general were concerned with the artificial taste and flavor of the lip balms that were on the market and were looking for alternative natural flavor options.
EOS lip balm designed products with these concerns in mind and developed blends that had all natural oils. These natural oils provided additional protection for the lips from the elements than the traditional lip balms that contained petroleum jelly. EOS used higher cost items in their lip balms and this led to a higher cost product. EOS marketed their lip balm on eBay as a premium product that came at a higher cost than their competitors and in an industry that typically sold their products for utilitarian purposes this was considered to be a big change.
Customers loved these new lip balms with their colorful orb applicators and this led to a quick expansion of sales and allowed EOS to dominate the lip balm industry in an exciting and innovative way.