Will fashion retailers who launch beauty lines succeed?

As of 2022, there are approximately 114,841 beauty brands in the US alone; last year, it was reported that the market generated about $511 billion in revenue. With these numbers in mind, it’s no wonder that celebrities, influencers and dermatologists want a piece of the pie. However, in recent years, we’ve seen the rise of another type of beauty brand creator: fashion labels.

Fashion brands expanding into beauty with their own cosmetics and perfume lines is not a new concept. For example, luxury fashion houses like Valentino, Giorgio Armani and Saint Laurent have also carried the beauty for decades (since the 60s and 70s in these cases, to be exact). “Brands are always looking for ways to better serve their customer,” Jenna Jackson, director of growth at CAVU Venture Partners, tells POPSUGAR.

However, since the early years, there have been more fast fashion brands following the trend. In 2009, Forever 21 launched its makeup line; Topshop followed suit soon after that year, as did Primark with its beauty line. In 2015, H&M Beauty launched; in 2017, Boohoo created Boohoo Beauty; then we were shocked when Zara announced news of its cosmetics line in 2021. This is by no means an exhaustive list, but the point stands.

From a business perspective, the motivation for brands taking this next step into the beauty space makes perfect sense. “Beauty products tend to have high margins and high repeat rates,” says Jackson. “Beauty products are also not trend-driven and are not usually subject to the pressures of falling clothes due to seasonality or trend.”

While it’s too early to tell, the COVID-19 pandemic may have also fueled interest in branching out into beauty. “These apparel brands broke through the bottlenecks more visibly as they watched their beauty counterparts see resilience and, in some cases like with skin care, growth,” says Jackson. “This certainly led to a level of desire to diversify their product offerings while also being motivated to continue to satisfy the wants and needs of the customer.”

With skincare, makeup or perfume within their walls, fashion retailers increase their chances of becoming a one-stop shop for consumers, which equates to even more revenue for them. But in an already highly competitive and oversaturated market, are these fast fashion brands positioned to succeed?

“There tends to be a bias that beauty is ‘easy’ because of the high margins and, for fashion brands, low inventory buy-in because you don’t have to deal with sizing,” says Jackson. “Fashion brands have to constantly come up with new innovations, new product launches and drops, while beauty can have a much slower development calendar. That said, beauty is a very tough business.”

Another factor to consider: just because someone likes a brand for its clothing doesn’t guarantee they’ll like its beauty offerings. “There’s a big difference in the consumer’s mind when buying a Zara dress to wear tonight versus deciding whether a particular product is something she’s willing to put on her face every day. The consumer has a lot of choices when it’s about beauty. and it’s looking for high-quality products,” says Jackson.

Only time will tell if these fashion brands are successful in expanding into the beauty space, but if they are, it will certainly be a profitable move. The beauty industry is projected to make $784.6 billion in revenue by 2025, and is only likely to grow from there. According to Jackson, “Making an outstanding product that really speaks to what the consumer is looking for and has a deep reason for existing is the best way to survive in today’s climate.”