How the "Lipstick Theory" is Changing the Terrain for Beauty Brands and Retailers
In today's economy, it seems that people are cutting back on all sorts of luxury items. But one area that seems to be immune to this trend is beauty. Even in tough times, people still manage to find money for new lipstick or a trip to the salon. This phenomenon is known as the "lipstick theory."
The "lipstick theory," is a concept that was first coined by Leonard Lauder, the chairman of The Estée Lauder Companies Inc., back in 2001. Essentially, the idea is that when consumer sentiment declines, people seek escapism by looking for small ways to indulge themselves. And what better way to do that than by buying a new lipstick or eyeshadow?
So, it makes sense that beauty giants like Ulta Beauty and SEPHORA would want to move into department stores like Target and Kohl's. After all, if people are still willing to spend money on beauty even when times are tough, then there's a good chance they'll continue to do so even when the economy improves. And what better way to reach more consumers than by putting your products in front of them where they're already shopping?
I can't help but think about the many times that I've ventured into a Target with plans to buy specific items only to come out with more. Target is known for its ability to lure shoppers in with low prices on everyday items, but the retailer has also become increasingly popular for its beauty offerings. Business Insider reports that Target's beauty department is now the third-largest beauty destination in the country, behind only SEPHORA and Ulta Beauty. The retailer has achieved this success by investing in innovation, such as its Beauty Concierge program, which allows shoppers to get expert advice on products and services.
Target has also partnered with well-known beauty brands, such as Glow Studio by Julep, to offer exclusive products and services. As a result of these efforts, Target has become a go-to destination for beauty shoppers, and it's possible that the retailer could expand its footprint into convenience stores in the future.
There are a more reasons why this is such a smart move for Ulta Beauty and SEPHORA. First of all, it gives them access to a whole new customer base. Department stores tend to attract a wider range of shoppers than specialty beauty stores do. So, by moving into department stores, Ulta Beauty and SEPHORA can reach a whole new group of potential customers.
Second, it helps them stay competitive against other beauty retailers who are also vying for market share. With so many different retailers selling beauty products these days, it's important for Ulta Beauty and SEPHORA to find ways to stand out from the rest. By having a presence in department stores, they can reach shoppers who might not otherwise think to visit a specialty store for their beauty needs.
Finally, it allows them to test new products and concepts in a less risky environment. When you're introducing something new, it's always helpful to have a built-in audience of potential customers who are already interested in what you're selling. That's exactly what Ulta Beauty and SEPHORA will get by moving into department stores—an instant base of customers who are predisposed to liking their products.
Target and SEPHORA's moves signal a shift in the beauty industry. Ulta Beauty moving into Target and SEPHORA moving into Kohl's indicates that these companies are willing to meet their customers where they are. This willingness to be flexible and adapt to customer needs is essential for any business, but it's especially important in the beauty industry.
So, what does this mean for beauty brand owners? First, it means that your industry is resilient and here to stay. Even in tough times, people will still allocate funds toward beauty products and services. Second, it means that you have a unique opportunity to create products and services that make people feel good about themselves—literally and figuratively. When you can do that, you're sure to find success—even in the worst of times economically.
Beauty is an ever-changing field, with new innovations and trends emerging all the time. In order to stay ahead of the competition, beauty brands and retailers need to be able to move quickly and adapt to the latest trends. Ulta Beauty and SEPHORA's moves show that they are prepared to do just that.
The power of the beauty dollar should not be underestimated. Even in tough economic times, people continue to spend money on beauty products and services because they offer a way to feel good about themselves without breaking the bank. If you're a beauty brand owner, this is good news for you! Keep creating products and services that make people feel good about themselves—literally and figuratively—and you're sure to find success—even in the worst of times economically.