I know that if I were to go through your makeup bag right now, the majority of products would have a story behind them. Whether that’s the foundation you wore on your wedding day or the lipstick your friend gifted you, after you kept complimenting theirs.
We create emotional affinities with beauty brands, but in doing so, we forget that they are businesses with bottom lines to their owners and investors.
When an independent brand finds success, the next step is always to scale upwards. To do so, founders almost always require the backing and cash injection of a bigger brand. A beauty conglomerate that will buy them and give them that global reach.
Take Jo Malone, who sold her company to Estée Lauder in 1999 and became a household name. For 26 years, they have been a star asset in Lauder’s portfolio of brands, but it’s not the same story for everyone.
In 2021, five years after acquiring them, Lauder closed Becca and, with it, took away the highlighter that shaped our most formative years. Champagne Pop. Gone, but never forgotten.
Now, Estée Lauder is reportedly looking at a package deal to sell off three substantial brands: Too Faced, Dr. Jart+ and Smashbox.
Lauder isn’t the only one cleaning up this January, as alongside it, Pat McGrath Labs is up for auction and will be sold to the highest bidder via Zoom on the 27th January.
As a beauty editor, some of these moves are not surprising to me, but they contrast with the “booming” beauty industry we consistently hear about. According to a report* British consumer beauty spending hit £32.4 billion in 2024, an 8% year-on-year growth. Space NK has opened 16 new stores in the last two years, and Sephora’s London flagship exceeded sales expectations by 300% in its first week. But with so many brands to choose from, it’s easy to get lost in a saturated market, especially when consumer loyalty seems like a thing of the past.
I was in New York in 2017 when makeup artist Pat McGrath launched her namesake brand. I found out because I peered under a gondola that had been covered up inside a Sephora store and saw the shelves lined with gold sequins. I checked Sephora every single day after that, waiting for the grand reveal. Finally, on my last morning in town, it launched and I gladly handed over $125 for a Mothership eyeshadow palette.
I vividly remember her applying some highlighter to my cheek and feeling everyone’s eyes on me, like I had been touched by the hand of god.
When McGrath finally launched in the UK in 2019, she took over Selfridges. The press morning was wild; we were all following her around like a flock of ducklings while she showed us her range. I vividly remember her applying some highlighter to my cheek and feeling everyone’s eyes on me, like I had been touched by the hand of god.
It’s funny, I often feel like I missed the golden age of beauty journalism, but when I think back to that day and McGrath’s individual eyeshadows that came in pouches full of loose gold sequins, I can’t quite believe the Great Gatsby of it all.
Six years later, and that golden empire is up for sale. It feels unbelievable, but the signs had been there for a while. The luxury packaging had changed to cardboard, with no reduction in price to reflect the downgrade. Rumours circulated on Reddit that the once-iconic eyeshadow formula had been quietly discontinued. There was a limited-edition Star Wars palette that felt a little less luxurious when customers realised the design was just a sticker. And with McGrath now cosmetics creative director at Louis Vuitton Beauté, the brand feels like a ship that’s lost its captain.
In terms of Estée Lauder, selling off the trio of brands is likely a strategic business decision after a few years of declining profits and tumbling share prices, in part due to slow sales in China, reported supply chain inefficiencies and failure to resonate with younger consumers. Resuscitation efforts are underway, starting with the appointment of a new CEO, Stéphane de La Faverie, at the beginning of 2025, with a plan to breathe new life into heritage brands, focusing on MAC, Clinique and Estée Lauder while also reviewing its wider portfolio.
Two of the brands up for sale don’t surprise me. In my opinion, Too Faced has failed to keep up with the times. It has a high-end price point, but the products feel and look like they are designed for a much younger audience. Smashbox left the UK and Ireland in 2022, and while they have some great products, their USP of being makeup born in a photography studio feels dated in a digital age.
While makeup and skincare might be our passion, to those at the very top, it all remains simply, but strictly, business.
The one that breaks my heart is Dr Jart, and I truly hope whoever buys it cherishes it. Their Ceramidin and Cicapair ranges are brilliant. However, I wonder if their sale is a combination of getting lost in a second-wave K Beauty boom (one that often features products at a more affordable price point) and being included in the sales package to boost relevance and appeal.
Whether we’re in a beauty industry boom or bust depends entirely on where you’re sitting. Rapidly growing indie brands stand to win big at billion-dollar acquisitions by venture capital or global conglomerates—case in point, L’Oréal Groupe acquiring Color Wow and Medik8 last year. At the same time, beauty’s relentless pace means brands once feverishly sought-after can fall out of favour just as quickly, while heritage names fight to maintain relevance in an oversaturated market. It’s just the natural lifecycle of the industry. And while makeup and skincare might be our passion, to those at the very top, it all remains simply, but strictly, business.