Beautycounter is postponing its relaunch deeper into 2024, according to an internal email viewed by The Business of Beauty.

Founder Gregg Renfrew bought the brand back from private equity firm Carlyle Group last month, with a view to reopen it on May 1. Counter Brands LLC, the parent company of Beautycounter was wound down, and Renfrew purchased the company with the help of private investors via a new firm, G2G. Beautycounter did not immediately respond to requests for comment.

In an email sent May 6 to the company’s direct sales staff, known as advocates, Renfrew said they “will not be able to launch operations” as soon as hoped and that a full launch is slated for late 2024. Beautycounter’s business model allowed individuals to order, sell and distribute products, as well as recruit others to do so, and earn a small commission on those sales.

Renfrew went on to say that when she purchased Beautycounter back, its economic situation was worse than expected, and it lacked enough funds to pay down debt. She described the last few weeks as a “mad dash” to try and restore operations, but that the original timeline is “too aggressive”.

Per the email, the relaunched company will have the same mission as Beautycounter, which was founded in 2013 with a “clean beauty” ethos that eschewed many common cosmetics ingredients, and also used a direct sales model. It later launched wholesale via Ulta Beauty and opened its own brick and mortar stores. The new company will still involve advocates, per the email, but the future earning structure may be different as the company evaluates its options.

Ulta Beauty stores will continue to sell Beautycounter until July; from then on, products will only be available via Ulta Beauty’s website. All non-seasonal Beautycounter brick-and-mortar stores are now closed, though a seasonal store in Nantucket will be open at some point in the summer.

The product assortment may also change; in the email, Renfrew said while she looks forward to selling well-loved products, “as with all other elements of the business, the team will evaluate the right assortment and offering for the future.”

The company could look very different when it returns. In the email, Renfrew said “all aspects” of the community and sales structure, including earnings and job titles will be assessed.

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It was an unusually hectic stretch in the beauty industry, with multiple multi-billion-dollar transactions floated, and some of the industry’s biggest and buzziest brands reporting financial results. If there’s one throughline that applies to all of these companies — and plenty in the fashion industry besides — it’s that brands that don’t keep their foot on the gas will quickly find themselves left behind.

This Week’s Winners

Puig bet big on prestige beauty, and is set to be richly rewarded, on track for a $15 billion valuation upon Friday’s initial public offering, after pricing shares at the top end of guidance earlier in the week. The family-owned company is a century old, but its current form was built on a rapid-fire series of acquisitions — five in the last five years, including Byredo, Charlotte Tilbury and Dr. Barbara Sturm (it also owns fashion labels Paco Rabanne, Dries Van Noten and Carolina Herrera). Each of these brands already had a strong following when it was brought into the portfolio, with Puig providing the resources needed to scale.

Also this week, Sky News reported that Manzanita Capital has hired bankers to explore a sale of Space NK, the premium British beauty retailer, seeking a valuation as high as $500 million. The upmarket chain is the go-to retailer known as a launchpad for popular international brands to make their British debut, cornering the role Sephora plays in the US, of carrying top-performing labels like Rare Beauty and Summer Fridays. It’s a lucrative niche: earnings have continued to rise steadily post-pandemic, generated with a relatively small network of 76 stores, in the UK. A combination of a generous loyalty programme, well-trained staff and its reputation as a tastemaker make it a continually attractive shopping destination.

Everyone Else

Not so long ago, Olaplex would have been on the list of red-hot brands with soaring sales. But its innovative approach to hair care as a pioneer in bond-building has since amassed plenty of competition from brands like K18 and Epres. Without exciting new offerings to keep ahead of rivals, sales have collapsed. On Thursday, the company reported a 13.1 percent decline in first-quarter sales compared with a year earlier. This counted as progress: a year ago, the drop was nearly 40 percent.

Meanwhile, L’Occitane chairman and majority shareholder Reinold Geiger put in a bid to take the group private, a move that would allow him to address the lagging performance of “dusty” flagship brand L’Occitane en Provence away from the prying eyes of investors (the company has done a better job with cult sensation Sol de Janeiro, which last reported 199 percent sales growth and an expectation to reach $1 billion in the past fiscal year).

And then there was The Estée Lauder Companies. The world’s second-biggest beauty conglomerate after L’Oréal reported a rare increase in sales (it had seen declines in five of the last six quarters). But it also warned that annual net sales would decrease by 1 to 2 percent, sending its stock tumbling.

Lauder has its share of hot brands, including fragrance lines Jo Malone London and Le Labo, and affordable skincare label The Ordinary. But most of the company’s sales come from stalwarts like La Mer and Clinique, and the portfolio includes brands like Smashbox that are a long way from their days as the most in-demand beauty start-ups. Most of these older brands have struggled over the course of the pandemic, though La Mer and Estée Lauder returned to growth in the most recent quarter.

Estée Lauder and L’Occitane made the same mistake of counting on the largest and fastest-growing emerging market — China — to boost these brands’ performance rather than trying to freshen their appeal with a new generation of consumers. Years later, they are still working to recover from that mistake.

Course Correction

All three of these companies have learned the hard way that staying relevant in an industry of fast-moving trends and an endless supply of buzzy start-ups requires constant innovation. There are no untapped markets where customers will automatically buy products just because they recognise the name on the box.

ELC is putting this learning into action with some promising, albeit preliminary, results. La Mer has embarked on youth-driven campaigns with Gen-Z influencers emphasising that the brand’s reformulated hero Soft Cream was “not your mom’s La Mer.” Following success with Clinique entering Amazon, ELC is planning on moving more brands into the channel as it looks beyond the department store beauty counter for distribution.

In China, too, brands have learned the importance of keeping up with its fast-moving trend cycle. ELC’s earnings report noted that a return to growth in China was driven not just by hero products, but new product innovations such as La Mer’s Moisturising Fresh Cream and Estée Lauder’s Ultimate Diamond Transformative Brilliance Soft Creme Moisturizer. L’Occitane previously announced a €100 million ($106 million) investment into marketing to revive its core properties, like L’Occitane en Provence and Elemis.

But the China market is no longer low-hanging fruit for growth, even without the pandemic restrictions that disrupted beauty spending. Successful navigation of beauty’s hype cycle will remain key in every geography this year as conglomerates need to keep momentum going on fast-growing acquisitions while continuing to invest in keeping their classic brands fresh.

No matter how much cachet brands have with consumers today, failing to evolve both in messaging and innovation can turn a hairline fracture into a full-on break. Puig and Space NK should take heed.

THE NEWS IN BRIEF

FASHION, BUSINESS AND THE ECONOMY

LVMH considering options for Marc Jacobs amid buyer interest, say sources. The review is in the early stages and LVMH hasn’t made a final decision on how to respond to the interest. LVMH has restructured Marc Jacobs in recent years, which led to a simplification of its product offering.

Tapestry-Capri deal to face September hearing. The preliminary injunction hearing on the US Federal Trade Commission’s bid to block Tapestry’s takeover of Capri will likely last a week and a half, the judge said. Tapestry shares rose 2.3 percent and Capri shares gained 0.8 percent following the news.

Pandora surges as lab-grown diamonds lift sales. The Danish company said organic sales are projected to rise 8-10 percent this year. The shares advanced as much as 6.6 percent in Copenhagen, and are up more than 80 percent in the past 12 months.

Vinted moves into profit after 61 percent sales rise. The Lithuania-based group said growth had been spurred by entering new markets and expansion into luxury fashion. Sales rose to €596 million ($637 million) last year — making it about a third of the size of Asos.

Next sales rise as inflation pressures ease. The British fashion and homewares company said full price sales climbed 5.7 percent in the first quarter, which was slightly ahead of an expected 5 percent rise. The company stuck with its outlook — that it will generate £960 million ($1.2 billion) of pretax profit with group sales rising 6 percent this fiscal year.

Mulberry’s full-year sales fall 4 percent. The British brand’s share price, which has fallen by almost 60 percent this year, declined by a further 4.5 percent. Mulberry blamed the luxury spending slowdown and a lack of VAT-free shopping for the declines.

Sneaker brand On to launch new line with FKA Twigs. The British musician will collaborate with the Swiss company on a collection of training apparel and footwear, and will serve as the face of the first collection to be released in August. Twigs is On’s first non-professional athlete ambassador since it launched in 2010.

THE BUSINESS OF BEAUTY

Shein wants to sell skincare, toothpaste and toys, too. The company is moving into other categories and has given brands and retailers access to its platform in nine European countries so far. The strategy is part of Shein’s plan to build credibility and better compete with Amazon ahead of a planned stock market listing later this year.

Bella Hadid launches fragrance line Orebella. The model launched three perfumes which will be available directly to consumers. The brand will then be available on Ulta Beauty’s e-commerce site from May 10, and subsequently in all Ulta Beauty stores from May 12.

Celebrity makeup artist Quinn Murphy launches beauty line. The label, Spatch, will debut on May 4 with a nine-piece collection of skin-perfecting products designed for professional and consumer use. It will initially be available only in the US and Canada, but Murphy hopes to offer international shipping and add more products.

PEOPLE

Sandra Stangl is exiting Banana Republic. Stangl joined the business in 2020 and sought to revive the struggling mall brand. Despite a brief uptick in sales, up 24 percent between 2021 and 2022, the brand’s growth has stalled.

Peloton CEO to step down. Barry McCarthy announced plans to leave his post as the struggling fitness company embarks on a major restructuring that will reduce its global workforce by 15 percent. The shares fell as much as 16 percent upon the news.

Cascale appoints new CEO. Former Under Armour COO Colin Browne has been appointed to lead the industry organisation formerly known as the Sustainable Apparel Coalition. The move was positioned as a way to acknowledge its broadening scope as it aims to address industries beyond apparel.

Susanna Lau joins System magazine as digital editorial director. The move comes as System owner Mike Obenson aims to turn what began as a bi-annual print title into a global media brand with a stronger digital offering. Lau, known online as Susie Bubble, was part of the first wave of digital creators to shake up fashion media in the mid-2000s.

MEDIA AND TECHNOLOGY

Condé Nast Union threatens strike ahead of Met Gala. Union members have pledged “to walk off the job” if progress is not made on contract negotiations. They have also promised “a week of union actions” in a statement from the NewsGuild of New York, the union’s organising body.

TikTok Shop tops 500,000 US sellers after 2023 e-commerce launch. Worldwide, TikTok’s e-commerce platform had more than 15 million sellers in December, adding more than 6 million in the second half of the year. E-commerce is seen by TikTok as its next big potential revenue source as well as a way to keep users spending time and money on its app.

Compiled by Yola Mzizi.

Quinn Murphy, a makeup artist who has worked with the likes of Kate Hudson, Karlie Kloss and Natalie Portman, is launching a beauty brand called Spatch on May 4, 2024.

The line will include six shades of Invisible Spot Fix, a new kind of spot-concealing product – the brand name, Spatch, is a play on the “patch” feature on the photo retouching app Facetune that allows users to quickly remove blemishes.

Unlike traditional concealers, Invisible Spot Fix, $29, is powder-based, not cream, and works to neutralise imperfections by colour correcting, rather than simply masking. “The [spot] could be rosacea, acne, dark spots, bruises, anything,” said Murphy. Because the product doesn’t conceal in the traditional sense, the shade selection is different, with more of a focus on correcting the imperfection, not matching the skin. “The colour of your spot is not the colour of your skin,” said Murphy, explaining that green-toned products work better for concealing red spots, while orange or peachy tones work to correct grey or blue areas.

A primer with salicylic acid, an alcohol-free setting spray and a dedicated application tool will also be available, with prices between $16 - $38. The range will be manufactured in Los Angeles and in Taiwan. Products will be sold directly to consumers via Spatch’s website, and Murphy is self-funding the launch.

It will initially be available only in the US and Canada, but Murphy hopes to offer international shipping and add more products. Wholesale distribution may be a consideration, with Murphy considering dermatologists’ offices over specialty retail for the time being, given how many people visit dermatologists with skin concerns.

Murphy expects the line to be popular with younger consumers, but also with men. “When I show this to anybody under 30…they tacitly understand it. Investors are typically older… they’re used to Chanel [or other luxury brands]. They want a beauty experience that’s not yet in their imagination,” said Murphy.

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Why Horace Thinks It Can Crack Men’s Beauty

The men’s market is a tiny fraction of the overall beauty industry. That hasn’t stopped a slew of brands trying to grow its appeal.

Space NK may be up for sale.

Manzanita Capital, the family office that has owned the retailer for more than 20 years, has hired the investment bank Raymond James to handle its sale, Sky News reported earlier this week. Space NK declined to comment on the report.

Manzanita has yet to make a final decision about whether a sale will go ahead, but the business could be worth between $374 million and $500 million, according to Sky News.

Space NK was founded in 1993 by Nicky Kinnaird and now spans 76 stores throughout the UK that sell premium beauty products, as well as indie brands. The retailer is regarded as a tastemaker, and was the first to sell brands such as Nars in the British market. It currently stocks buzzy brands such as Rare Beauty, Summer Fridays and Olaplex.

In 2018, Manzanita, which also owns the fragrance brand Diptyque, explored a sale, but chose not to proceed, per the report. It has had a number of successful exits; most notably in 2022, Puig snapped up a majority stake in its fragrance brand Byredo for a reported $1 billion.

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Beauty E-Commerce Is Broken

Once thought of as long-term disruptors who would change the way we shop forever, multi-brand online retailers that sell cosmetics, skincare and fragrance are facing multiple headwinds.

Vita Liberata, the premium tanning brand known for its organic formulas, has been acquired by its founder, the Irish businesswoman Alyson Hogg for less than $12 million. Vita Liberata makes both consumer and professional products. Hogg sold the business to Crown Laboratories in 2018. At the time of its original acquisition, Vita Liberata was generating $62 million a year in retail sales; current retail sales are $37 million.

Hogg declined to give specific numbers, but said the brand was sold to Crown Laboratories for more than $30 million.

In a statement, Hogg said she is bullish on the category despite its low market penetration which she estimates to be under 10 percent. “[Self-tanning] is growing thanks to science and innovation…a major reason penetration is so low is the ridicule the category is often subjected to,” said Hogg.

Self-tanning products have historically had pain points such as a bad odour, transferring onto bedding or clothes and a streaky or unnaturally dark finish. Hogg believes her more luxurious, sophisticated formulas can mitigate these risks and encourage consumers to try self-tanning, especially as concerns around sun safety grow.

Hogg will remain in her role as chief executive officer. “We did it once, we will do it again,” she said.

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Go-To Skin Care Bought Back by Founder

Beauty entrepreneur Zoë Foster Blake has regained control of Go-To, the skin care line she co-founded. A majority share of the company was sold to Melbourne-based beauty manufacturer BWX Limited in August 2021 for 89 million Australian dollars ($60 million).

In its first-quarter results, LVMH’s Selective Retailing unit was the French conglomerate’s brightest spot. Sales rose 11 percent on an organic basis, with “remarkable growth” at Sephora cited. Overall sales for LVMH rose 3 percent, indicating that fears that luxury demand was cooling in step with economic growth were well-founded.

Sephora’s store network expanded in the last quarter, particularly in the US, though growth was also noted in Europe and the Middle East. Within the Selective Retailing division, the company’s duty free business is still trading below its pre-Covid level of activity, which LVMH chalked up to the slow resurgence of international travel to flagship locations in Hong Kong and Macau.

Perfumes and cosmetics also grew 7 percent, with fragrances a continued champion. LVMH noted the strong performance of Dior perfumes, many of which are hero products such as Sauvage, J’Adore and Miss Dior. The viral popularity of Maison Francis Kurkdjian’s Baccarat Rouge 540 was another boost. Skincare and cosmetics from Guerlain and Dior also contributed to growth.

The division’s resilience may be a balm for the beauty industry, which has been on unsteady ground since executives at Ulta Beauty signalled demand across prestige and mass was softening in March. The news that it expected its first-quarter results at the lower end of its guidance caused a rout on Ulta Beauty’s stocks, with a wider drop for other beauty firms including E.l.f. Beauty and Coty.

Disclosure: LVMH is part of a group of investors who, together, hold a minority interest in The Business of Fashion. All investors have signed shareholders’ documentation guaranteeing BoF’s complete editorial independence.

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Ulta Sparks Rout in Beauty Stocks on Warning of Slowing Demand

The company’s stock plunged as much as 15 percent, the most it has tumbled since March 2020.

If you’ve heard of Deciem at all, it’s almost certainly for its low-price skincare brand The Ordinary. Only true beauty fanatics would be able to name even a few of the more than 10 other brands the company has released since its 2013 launch. That was by design. Deciem went all-in on The Ordinary after it took off in 2017, eventually shutting down all but two other lines.

Now, Deciem, which was acquired by The Estée Lauder Companies in 2021, is dusting off one of those less-talked-about brands.

Originally launched in 2015, NIOD (an acronym for Non-Invasive Options in Dermal Science) is the chalk to The Ordinary’s cheese. The Ordinary’s branding is all about simplicity, with products often named after a single active ingredient, packaged in sterile and lightweight materials, and sold for prices as low as $4.70.

NIOD marketing and brand messages verge into Kafkaesque territory. Some products are named for multiple raw ingredients, such as copper amino isolate serum 3 1:1 (the brand provides the helpful acronym “CAIS3″). Others are more cryptic: an antioxidant serum is called Survival 0; Sanskrit Saponins is a cleanser. The longer names come with prices to match, with a tiny bottle of eye serum costing $70.

NIOD’s technical product names and tagline “Your skin is intelligent. Optimise accordingly” fit neatly into the ever-growing crop of “science-backed skincare” brands elbowing for room on Sephora’s shelves. They’re also straight out of The Ordinary’s playbook (or perhaps the other way around, as NIOD launched a full year before its lower-priced sister brand).

But Estée Lauder could use a hit. The Ordinary is successful enough to have its own dedicated Reddit and Facebook fan forums, and is a persistent bright spot in its parent company’s otherwise dreary earnings - chief executive Fabrizio Freda name-checked the brand multiple times in its second quarter 2024 results, saying it had “extraordinary success,” with net sales growth in every region.

With NIOD, new products, new distribution lines and a marketing push will soon roll out, and an external PR agency has been hired for the brand.

It’s rare for lightning to strike twice in the skincare industry. But NIOD has a shot, said Dr. Julian Sass, a cosmetic developer and content creator. He described the brand as embodying many of the traits consumers love about The Ordinary, but with a promise of better results.

“So many of [NIOD’s] products are so much better than The Ordinary, both in terms of the quality of the formulas and the raw material,” he said.

A Return to Roots

NIOD was Deciem’s first skincare brand, but as orders for The Ordinary’s affordable products began to fly in, production of NIOD’s more-complex products had to slow down (even its packaging is manually assembled).

“In any business, you have to make difficult decisions,” said Nicola Kilner, Deciem’s co-founder and chief executive. “If we needed 1,000 [of NIOD’s hyaluronic acid serum], but we also needed 100,000 of The Ordinary’s version, that always got priority on the production line.”

While the brand was never officially put on pause, no new NIOD products have been released since 2020. Now, the company is in a better position to satisfy increased demand, having invested in more machinery, and improved its supply chain. Its fill rate – the percentage of orders that can be fulfilled based on existing inventory – is 96 percent, whereas a few years ago, it was 50 percent at best.

Kilner said the last half decade hasn’t been wasted, describing NIOD’s customer base as “very engaged.” It’s much smaller, however: NIOD has 18,000 Instagram followers, to The Ordinary’s 2.4 million.

Complex on Purpose

It’s possible that NIOD was simply ahead of its time.

The Ordinary led with hero ingredients like hyaluronic acid and niacinamide that, while sometimes a mouthful, could be quickly explained by a Google search. NIOD’s acronyms and lengthy product names required an extra level of skincare literacy.

Nearly a decade later, you’re as likely to see The Ordinary’s products in a beauty editor’s bathroom cabinet as you are in that of a twenty-something bachelor who doesn’t own a bed frame.

The in-the-know skincare aficionados have levelled up, and NIOD is targeted at those early adopters. Kilner described NIOD’s range having a focus on pre-cursors, ingredients that can spur the skin’s own regenerative processes.

Deciem is hoping that the burgeoning longevity movement will provide a fresh customer base. A subsect of wealthy consumers have become more interested in wellness services and products designed to enhance lifespan.

For a consumer well-versed (or at least, willing to learn) about biomimicry and other health hacks, NIOD offers an appealing proposition. But a casual shopper may not know what to make of Survival 0, an antioxidant serum described as part of a “range of four networked protection systems,” offering protection against “the superoxide radical, nitrogen radicals and carbonyl radicals.”

“I only know a lot of what these products do because, firstly, I make products and also I know people who could help me interpret it,” Dr. Sass said.

Dr. Sass added that when he’s made content about NIOD products, he has to break things down in order for his audience to follow along.

“When it’s too high level, then you lose people,” he said. (Dr. Sass said he has not been paid for his NIOD content and has no other financial relationship with the brand.)

Kilner said NIOD’s complexity is part of its appeal.

“We don’t need to please everyone … we’ll never dumb down our science to please a consumer,” she said.

The complex messaging is one reason Kilner said she expects NIOD sales to primarily come, at least in the beginning, through its own channels. Its top-performing bricks-and-mortar store is in Seoul, though products are for sale at Selfridges and a few other retailers. Facials will also soon be available in Harrods, the upmarket London department store.

In-House Competition

NIOD’s team will also have to convince consumers the higher price point is worth it. For instance, both NIOD and The Ordinary sell hydrating hyaluronic acid serums, but NIOD’s costs six times more. The pricier brand says it uses a different formula that is 8.25 times more expensive, containing 15 forms of hyaluronic acid compounds including precursors and mimetics, while the cheaper one contains just five.

“NIOD uses technologies so new, sometimes so new there’s only one manufacturer,” said Kilner.

NIOD is identifying new raw materials and investing in the clinical legwork to support bigger claims about efficacy. In 2023, it secured its first patent for a copper peptide blend that it says improves skin radiance and texture. The first NIOD product to use it retails at $93, but the technology has also been shared with The Ordinary, which launched a less-concentrated version for $32, its most expensive product yet.

Ultimately, Kilner says the brand will be led by what the labs provide. If they discovered important enough technologies to warrant it, NIOD “would charge $300 for a product,” said Kilner.

“We are not afraid of the price point,” she said.

The clinical claims section of the beauty market is led by ultra-premium brands like Révive, Dr Barbara Sturm and Augustinus Bader, all of which offer serums with triple digit price tags and all the grandeur to match, from tasteful packaging, evocative names and light textures.

Deciem is betting that NIOD’s customer is a little different: someone who wants the most cutting edge option at every turn, even when a cheaper alternative is available – or maybe even a more expensive one with a more luxurious feel.

The U.K’s competition watchdog, the Competition and Markets Authority (CMA), has issued an open letter to nail technicians after a campaign called National Nail Tech Price Increase Day began to gain steam online.

The campaign, led by the trade body Nail Tech Org (NTO), claims that member nail technicians make on average just under £7 ($8.88) an hour, once costs such as rent, energy, insurance and products are factored in. The national minimum wage in the UK increased to £11.44 ($14.51) in April.

More than 5,000 technicians came together as part of the campaign to raise their prices on Monday. The same day, the CMA issued an open letter, stating that it wishes to remind all businesses in the nail services industry that they must comply with competition law.

”In particular, we want to underline that businesses must set their prices independently and that competitors should not discuss or coordinate among themselves the timing or amount of any price increases (whether directly or through a trade body or other membership organisation),” said the CMA.

Amy Guy, the founder of the NTO, told the BBC that any price increases would be dependent on individual businesses, that not every nail technician would increase them and that the campaign was to educate nail technicians about building a sustainable, fair business.

The U.K has been exposed to soaring energy costs following Russia’s invasion of Ukraine in 2022, while the cost of living crisis has put downward pressure on consumers’ discretionary spending. At the same time, time-intensive services such as builder gel or acrylic manicures have grown in popularity.

While the CMA has not conducted a formal investigation, it said it had been in touch with Guy. Competition law breaches can attract fines, and the disqualification of company directors.

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Lashes, Brows, Botox: How Much is Too Much?

No longer the domain of the elite, lash extensions, brow treatments, injectables and more have become part of mainstream consumers’ beauty maintenance routines. But online backlash is brewing against growing pressure for elaborate upkeep.

Puig, the family-owned Spanish beauty conglomerate, announced plans for an initial public offering on the stock exchanges in Barcelona, Madrid, Bilbao and Valencia. The company owns 14 brands including Charlotte Tilbury, Paco Rabanne and Byredo, as well as a number of fragrance licences.

The company hopes to raise €1.25 billion ($1.3 billion) through the first round of IPO, followed by a larger secondary sale that would bring the total fundraising north of €2.5 billion. The Puig family will retain a majority stake in the company and the “vast” majority of voting rights, the company said.

In 2023, Puig reported net revenues of €4.3 billion ($4.6 billion), up 19 percent, while net profit rose to €465 million ($503 million), up 16 percent on the previous year.

In October 2023, chairman Marc Puig confirmed the group was mulling an IPO among other strategic options to raise fresh capital. In a statement released today, Marc Puig said the decision was a “decisive step” in the company’s 110-year history, and that it was important to ensure the “right checks and balances” were in place during a “generational transition.”

“We believe that the balance of being a family-owned company that is also subject to market accountability will allow us to better compete in the international beauty market during the next phase of the company’s development,” said Marc Puig, adding that being a publicly listed company will align its corporate structure with those of best-in-class, family-owned companies in the global premium beauty sector. Top industry players such as L’Oréal and Estée Lauder have long been publicly traded, as well as retaining founding family ownership stakes.

The company plans to further diversify into skincare and makeup, and focus on prioritising brands it owns outright rather than licenses, which can be expensive to renew and disruptive when they lapse. 95 percent of revenues came from fully-owned or majority-owned brands like Paco Rabanne, Dries Van Noten or Nina Ricci last year, Puig said.

The company has been making more acquisitions of late – in January, it purchased luxury skincare brand Dr. Barbara Sturm, following its acquisitions of Byredo and Charlotte Tilbury since 2020.

“Our unique and creative DNA has allowed us to attract leading founders and brands… We strongly believe that building premium brands requires long-term thinking,” Marc Puig said.

Currently, fragrance is Puig’s largest revenue driver. But the group’s smallest segment, skincare, grew the most in 2023, with revenues up 31 percent to €431 million ($466 million). The company has long been profitable, Puig added.

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Luxury Brands Might Think Twice Before Buying Back Their Beauty Lines

In search of greater ownership — both of image and revenues — more fashion houses are wresting back control of their beauty licences. But running a beauty business can stretch otherwise well-resourced, powerful companies beyond their capabilities.

Tom Ford has appointed Dexter King as senior vice president, global general manager, promoting him from his previous global marketing and strategy position. King has been with the business for nine years, and will continue to report to Guillaume Jesel, the brand’s chief executive and president.

In his new role, King will be tasked with driving the brand’s luxury positioning and expanding geographic growth. Tom Ford Beauty is of great importance to its parent, the Estée Lauder Companies – in 2022, it splurged $2.8 billion to acquire the entirety of the brand so it wouldn’t lose the rights to its lucrative beauty line.

Sales of its premium products have contributed to pockets of net sales growth for ELC against its difficult post-pandemic recovery; hero products like the Black Orchid and Lost Cherry perfumes and Shade and Illuminate contour palette are enduringly popular, while new launches like the Ultra-Shine Lip Color also generate buzz.

“Dexter’s appointment recognizes his tenured success on Tom Ford Beauty and I look forward to working with him on the future of luxury beauty,” said Jesel.

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Estée Lauder Reveals Its Recovery Playbook

The beauty giant announced layoffs and plans to regain profitability, measures to restore faith in investors and customers alike.

Walmart wants to lure the luxury beauty shopper.

High-end brands such as the skincare line Skinceuticals and hair care line Color Wow, and added services like virtual try-on might feel unexpected for the mass retailer best known for low prices in its enormous hypermarkets it calls “Supercenters,” but Creighton Kiper, merchandising vice president of beauty, says they’re proving popular: “Luxury beauty as a whole will continue to be a focus at Walmart,” said Kiper, adding that it has seen “tremendous success” both in-store and online. Walmart operates over 4,600 stores in the US.

An added luxury push is right in line with Walmart’s evolving customer base, which has steadily begun to encompass more high-income households. In its fourth-quarter fiscal 2024 results announced in February, the company noted that gains with “high income households” in the grocery category (in which it includes beauty products) contributed to its 4 percent net sales growth to $118 billion. Overall sales for the fiscal year reached $449 billion, up 5.6 percent.

Walmart’s premiumisation push comes against a disjointed economic climate. Inflationary pressures have caused some higher-income customers to start to hunt for bargains, which has seen them increasingly turning to low-cost stores like Walmart they may have previously skipped for essentials. But they’ll likely still splurge on beauty while they’re there: even as they shop for cheaper alternatives to everyday items, consumers tend not to trade down on beauty products, seeing them as inalienable, must-have treats. Walmart could use that stickiness; Morgan Stanley estimates that by 2025, Amazon will supersede it as the US’s biggest beauty retailer. And Target, which has carried been first to carry masstige brands like Naturium, Odele and Versed through its own merchandising as well prestige labels Anastasia Beverly Hills and Benefit Cosmetics through its partnership with Ulta Beauty, has taken a different approach, launching a newer private label brand with some cosmetic products priced at less than a dollar.

Hit The Accelerator

Thanks to the success of lines like skincare label Bubble, Walmart has further experimented with indie brands by launching its own brand accelerator, called Walmart Start, in 2023. The first cohort included hair brand Pardon My Fro and perfume line Dossier; the second cohort, announced today comprises skincare label Current State, hair brands Latinus and Kazmaleje and body care line Sundae Beauty.

Accelerators have become a popular way for established big-box retailers to network and build relationships with indie brands without needing to take the gamble of signing them outright. There’s Ulta Beauty’s Muse Accelerator, Sephora Accelerate and Target Takeoff, all designed to identify early-stage brands with potential and get them into the retailer’s owned environment.

“The easy part [about selecting brands] is we’ve got so much data that tells us what customers are looking for…what solutions they’re looking for,” said Kiper. “There’s just so many trends out there…we’re able to kind of marry customer data and industry data trends and then see what type of brands and suppliers are out there that fit that need,” he said, adding that they expect high growth potential from all brands carried.

In addition to the potential of being stocked at Walmart, brands in the accelerator programme also receive education on how to prepare for a successful launch in the retailer’s doors, mentorship and networking opportunities. Kiper said that while cult appeal is important, brands need to have the muscle to be able to succeed at a larger scale: “When we say scale, we’re talking about 500 to 1,000 stores.”

Little Luxuries

Walmart began to experiment with luxury beauty via a partnership with the British premium pure player Space NK in 2022. Dedicated “BeautySpaceNK” gondolas with curated products rolled out into almost 250 stores, while 15 brands including Mario Badescu and Slip were also shoppable online. The partnership has grown; Kiper says it now boasts 275 stores.

It’s also expanding its beauty virtual try-on services, which it developed in partnership with AR firm Perfect Corp. Originally launched with cosmetics in October 2023, it now includes hair colour products that can be “tried on” via Walmart’s Apple iOS app. Over 2,200 products can now be virtually sampled.

Category-wise, Kiper said that hair care and cosmetics still dominate, but that skincare is its fastest-growing segment. He still sees more growth potential in hair care, calling it an “entry point” to beauty: “There’s a lot of room: more problems to solve, more solutions needed, whether it’s washing, care or styling.”

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PARIS – Some might call Neuraé, a new seven-piece skincare line that leans on neuroscientific research, a mix of beauty and brains.

The brand is produced by Sisley, the family-owned beauty company known for luxury skincare, makeup and fragrance products like its Black Rose Cream Mask, $200, and the ultra-premium, anti-ageing Supremÿa line, which includes a $940 night cream.

Neuraé, which debuts on April 2 in France, Italy, the UK and US, is a more moderately priced line, retailing from $65 to $195. Distribution of the line will be through e-commerce, alongside Sisley’s existing core partners like Bergdorf Goodman, Sephora and Neiman Marcus.

Some parts of the brand’s attempt at the mind-skin connection can be easily observed – blushing or flushing of the cheeks when embarrassed or angry, or the feeling of prickling heat when panicked. Research to further understand how emotions such as calmness (and conversely, stress) show up on the skin have become of particular interest to beauty companies and consumers alike.

Despite the movement’s burgeoning popularity, Philippe d’Ornano, Sisley’s president and second-generation leader, said, “We didn’t look too much at the market … we look at how we can do better.”

The line has been in the works for 10 years, per d’Ornano, with the Sisley in-house development team carefully formulating – and re-formulating – as their research advanced.

The range is divided into four sub-lines, Harmonie, Énergie, Joie and Sérénité, and claims to use both scent and texture to deliver mood-boosting, and thus, skin-boosting results. Core products include roll-on scented oils, a serum and refillable face cream.

The Family Jewels

Neuraé does not share the renowned Sisley brand name, nor will it be marketed with any parent company connection. d’Ornano said that while launching the brand without the halo effect of the Sisley name will create some challenges, he didn’t want to cause confusion; either for customers who already shop with Sisley, or the sales staff who are tasked with selling either line.

”We try to keep the simplicity in each of our brands, so they’re easy to explain,” he said. “[It will be] complicated for us to launch a new brand and create new alliances … but it will maybe let us touch new customers, too.”

Neuraé is the first time the company has launched a standalone offshoot. In 2018, it added a hair care line, Hair Rituel by Sisley – featuring a $110 hairspray – which d’Ornano said was a gamble, given that by their estimates, hair care made up only two percent of sales in specialty retail stores. “Now, it’s developing very fast,” he said.

France is home to several family-owned beauty brands, including Clarins, still owned by the Courtin-Clarins family, and Caudalie, owned by founders Mathilde and Bertrand Thomas. All three have made beauty investments, and d’Ornano said it is in a position to buy companies should they choose. Its family office has a mix of investments in energy and real estate as well.

Launching the brand separately also prevents any dilution of the valuable Sisley name. The brand took sales of €930 million ($1 billion) last year, with skincare accounting for around 70 percent of revenue. It has upheld its reputation for being expensive but worth it in beauty circles: on Reddit’s dedicated luxury skincare forum, /r/SkincareAddictionLux, one user said of Sisley, “I have been trying for months to find an alternate that works just as well but for cheaper.....and none have even compared.”

Sisley was launched by Franco-Polish nobles Isabelle and Hubert d’Ornano in 1976 – Hubert’s father previously co-founded Lancôme before its sale to L’Oréal. Since then, the family has run the business as a private enterprise, with Philippe and his sister Christine, who serves as global vice president, leading operations. Philippe d’Ornano said 95 percent of skincare and 60 percent of makeup is produced with in-house facilities; all of Sisley’s formulas are developed at its laboratory near Paris.

A Quieter Luxury

Despite Sisley’s high price points and swanky packaging, “luxury” is a term d’Ornano says he is not very comfortable with. “To me, you can do a luxury handbag,” he said. “My customer can perceive [Sisley] as a luxury … but if I can make a product that is less expensive, I’m happy to do it,” he said. Triple-digit price tags for products as quotidian as make-up remover in Sisley’s core line may raise eyebrows, but d’Ornano explains this by saying their formulators take a different approach.

Instead of starting out with a product concept that includes the price, the R&D team works backwards when it comes to development, essentially having carte blanche.

Their elastic approach to budget and price is unusual – least of all because very few beauty companies have enough cash, cache and vertical integration to operate in such a manner. Having an established prestige brand also grants it freedom to price things as high as they need – there’s no need to try and premiumise when you already have a customer base comfortable with paying almost $1,000 for night cream.

d’Ornano said he has no sales target for Neuraé; instead, he hopes “people will like it and buy it more than once.” He plans to take the launch slowly, and notes that while Sisley is active on social platforms like Instagram and TikTok, most of their referrals still come from word of mouth or store associates.

Ultimately, the family will call the shots. “For example, with Neuraé, we have [a marketing plan],” said d’Ornano. “But I can break it whenever I want.”