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Target, Kohl’s Give Health And Beauty Partnerships A Makeover

The pandemic, and the stay-at-home lifestyle it brought, has altered the beauty routine of the average consumer. Lipstick sales as of this fall had crashed over the last six months, as homebound and mask-wearing consumers suddenly found lipstick was more of a messy bother than it was worth.

And while lipstick seems to have taken the hardest hit, down 25 percent in the last six months compared to last year, according to NPD Group estimates, the hit has been far from evenly distributed, as consumers are continuing to buy makeup — even quite expensive makeup — though they are adapting both what they buy and how they buy it.

“Humans groom themselves. It’s just what we do,” Doreen Bloch, CEO and founder of beauty data company Poshly, told Vox. “People are still spending, people are still engaging in the category, but they’re shifting their dollars around.”

Shifting Patterns

The advent of life on Zoom has lowered enthusiasm for some categories of makeup, lipstick and foundation in particular. Neither are all that noticeable on a Zoom call, according to experts, and the program itself does the job just as well with its “beautify” feature that consumers can choose to do the work of makeup digitally.

Eye makeup, as well as products to accentuate the eyes like fake lashes and eyelash extension tools, on the other hand have seen an upsurge in sales, according to NPD data, as eye makeup done right is far more apparent on a video conference.

And while consumers have shown less interest in adorning their face with makeup, their interest in caring for their skin has skyrocketed during the pandemic, with “maskne” (skin breakout caused by wearing a mask all day) being the condition de jour for the industry to solve.

And consumers are going further than just creams and scrubs to care for their skin. There has been something of a boom in sales for skincare gadgets like the GloPro (a $199 microneedle that punctures tiny holes in the skin to stimulate collagen production and increase product absorption) and NuFace (a $325 device that runs an electric current through the facial muscles to provide lift and toning).

“People are definitely using tools, and if they didn’t have one, they now want to know what they should be getting. They’re thinking, ‘I’m at home, I’m not going to be seeing anybody, so I might as well take the time now to really go hard on my skin care and gadget routine so that when we are able to go out and see people I look my best,'” beauty podcast Gloss Angeles host Kirby Johnson noted.

A Reforming And Reshaping Market

As the beauty world is changing and shifting in terms of what consumers are buying, and where they’re buying it, so too are the merchants and retailers looking to keep up with them. And as digital channels, particularly social channels like TikTok and Instagram, are increasingly being leveraged by up-and-coming brands like E.L.F beauty and others, the more well established names in the physical cosmetics retail game are restructuring their approach to the market visa new collaborative approaches.

The first big announcement in this arena was led off by a joint announcement by beauty giant Ulta and Target that the two will be collaborating in the second half of 2021 to start opening Ulta mini-stores in about 100 Target locations nationwide as well as on its website.

The “shop-in-shop” design will involve a 1,000 square foot space with more than 40 beauty brands and a rotating assortment of products. Goods will be available for in store purchase as well as through digital services like curbside pickup or via home delivery by Shipt.

Partnership brings benefit to both firms — as they collectively bring more than 100 million active loyalty program members into the news partnership between Target Circle and Ultamate Rewards.

As it turned out, Target and Ulta were only the first of the big beauty brand pair-ups. As of Tuesday (Dec. 1), Kohl’s and Sephora have announced their own mini-store partnership which will see hundreds of mini Sephora shops nestled in Kohl’s stores over the next several years.

According to reports, roughly 200 Sephora shops in Kohl’s will open by late 2021, with a grander plan to have expanded to 850 by 2023. In addition, Sephora will also launch on the Kohl’s website next year with 100 beauty brands.

“When we think about the beauty industry today, we’re very underrepresented,” Kohl’s CEO Michelle Gass told CNBC. “It’s a huge market [and] it’s expected to grow over the next few years. We’re going to be very loud about this. There’s no question that [shoppers] will see Sephora from the exterior of the building.”

Once upon a time the physical world of cosmetic sales was dominated by the department store segments, with their makeup counters designed to curate the brightest and best in consumer cosmetics. But as department stores have struggled over the last decade, and beauty has moved online and on mobile, the landscape has shifted — even faster in the last eight months.

Will the new partnership model of physical locations with digitally-enabled services built in take the department store’s place, or will department stores find a way to give themselves enough of a retail makeover to take their crown back?

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