Reflect.com delivers fully personalized Web customer service

It's a long way from Cincinnati to Silicon Valley, but for Procter & Gamble spin-off, Reflect.com, moving away from home may be its best chance for Internet success.

The company, which is still unpacking boxes in its new offices and winding down beta testing on its potentially breakthrough Web site, faces major challenges.

Foremost, it will soon discover if its vision of personalized customer service can compete in the heavily brand-driven world of women's beauty-care products.

"What we're committed to is nothing short of a revolution within the beauty industry," says Andrew Swinand, Reflect.com's marketing director. "The beauty industry today is a push industry. But what's cool, hot and hip doesn't reflect a woman's right to choose the right products for her own very personal needs."

The site, expected to go live in early December, is owned by P&G, with venture capital from Institutional Venture Partners. The spin-off will sink or swim on its own, but P&G is hoping its $50 million investment will not only one day lead to IPO riches, but that the best practices Reflect.com can build on the Web will be driven back to the parent company.

Analysts think this closely watched spin-off can pull it off.

"The Internet is ideally suited for mass customization, and I have no doubts Procter & Gamble can deliver mass customization," says Mike May, a Jupiter Communications analyst.

Reflect.com represents a challenge to the traditional brand-marketing strategies of players like P&G. "We see ourselves as a service rather than a brand," says Swinand. "The brand does not exist until you create your own brand of beauty products online."

To pull this off, Reflect.com also portends a revolution in IT and supply chain management. Sitting behind the site's flashy, interactive front end are new business-to-business practices that are equally cutting edge.

The Reflect.com site works like this: Customers come to the site and answer a series of questions that draw out information relevant to beauty care. What is the women's age and race? Is she athletic or beauty focused? What sort of beauty-care products does she use? Customers can even change the site's fonts, colors and beauty models to reflect their own preferences.

"We've worked with research to develop questions that hone in on what a woman needs," Swinand says. "After 20 years, a woman knows her skin type and how much time she spends in the sun."

Once a visitor answers questions, the site creates a personalized line of hair-care, skin-care and cosmetics products. Customers can choose the product's scent, color and packaging.

There's a "secret recipe" behind Reflect.com's success: It has access to all of P&G's product research. This means it can build a new product out of formulas that might never have made it out of the lab, yet suit a particular women's needs perfectly.

"P&G has 1,500 Ph.D.s around the world doing research," says Swinand. "In the brick-and-mortar world, we can sell only the top-10 shampoo formulas. If it doesn't appeal to the masses, we can't shelve it. What we've done is given women access to all these formulas."

Swinand admits the product mix isn't infinite, but Reflect.com does have the ability to create some 50,000 unique products.

The product creation process that begins at the Reflect.com Web site ends--fittingly enough--with a Cincinnati-area fulfillment company, Direct Site. This company uses patent-pending manufacturing technology to build the customized products on the fly.

For a brand-conscious company like P&G, Web-based personalization "in some respects amounts to brand heresy," says Swinand. That's what makes the spin-off all the more necessary, he says.

Everything about this Web company--from product development to marketing to product launch--is different from the traditional brand-marketing world.

"In the brick-and-mortar world, launching a new product is 95 percent distribution," says Swinand. "You have three to six weeks to build mass marketing and media around a launch. Then on a Tuesday, you have the product in 4,000 Wal-Marts around the country."

In comparison, Reflect.com has done what amounts to a "soft-launch," with limited national advertising and a major reliance on word of mouth. "We want to create and build relationships with individuals," says Swinand, "and build that into a groundswell."