Following the acquisition of beauty guru Charlotte Tilbury’s eponymous brand by Spanish conglomerate Puig last week, Retail Week examines which independent beauty brands could be next on the hit list.

Social media is awash with revolutionary beauty and skincare brands designed to shake up the industry and attract millennial and Gen-Z spend.

While names like L’Oréal and Estée Lauder still hold traction in the beauty world on their own-label merits, acquiring these Insta-famous brands now seems essential for growth.

“Covid-19 will hit small independent brands, making takeover bids from big businesses much more attractive”

Samantha Dover, Mintel

With Puig fighting off L’Oréal, FMCG giant Unilever and Japan-based Shiseido to snap up Charlotte Tilbury, it has become apparent that many international players are looking to boost their portfolios with new acquisitions.

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Charlotte Tilbury was bought by Spanish conglomerate Puig earlier this month

Charlotte Tilbury is the latest in a string of beauty purchases in recent years, from Estée Lauder buying Too Faced in 2016 to Coty acquiring Kylie Cosmetics and Kylie Skin last year, with the latter reportedly also expressing interest in Kim Kardashian’s label KKW in 2020.

“In today’s fast-moving beauty landscape, independent brands rarely stay independent for long,” says Mintel senior beauty and personal care analyst Samantha Dover.

“Although Charlotte Tilbury was one of the largest independent beauty brands on the market, making it an attractive acquisition, it is unlikely to be the last high-profile acquisition in 2020.

“Big beauty businesses will continue to acquire small independent brands to reach new consumer groups, and Covid-19 will hit small independent brands, making takeover bids from big businesses much more attractive.”

Matthew Moulding, chief executive of The Hut Group, which has acquired beauty businesses including Illamasqua and Glossybox in recent years, says he is on the lookout for brands that can be built up and taken to the next level.

“What we’re focused on is taking a brand from where it is today, building it out, premiumising it and broadening the range,” he explains.

“It’s got to have a certain quality, a brand reputation, and an ability to be taken direct to consumer around the world – the brand and product efficacy is most important”

Matthew Moulding, The Hut Group

“The brand doesn’t need to be enormous already, but we want to be able to take it direct to consumer in every corner of the world. What is less attractive to us is if a brand is reliant on the high street or discount channels, as that’s far more challenging to re-engineer.

“It’s got to have a certain quality, a brand reputation, and an ability to be taken direct to consumer around the world and build on its credentials – the brand and product efficacy is most important.”

GlobalData analyst Emily Salter concurs: “It is important for big conglomerates to keep adding to their business through acquisitions as they support future growth, keep them relevant, help them become leaders in new markets, in terms of both products and geographies, and attract a new customer base.”

So which brands could be next on the hit list for conglomerates making beauty acquisitions?

Anastasia Beverly Hills

Known as the “Eyebrow Queen”, former Hollywood aesthetician Anastasia Soare founded Anastasia Beverly Hills with a salon back in 1997 and launched its first product line in 2000.

The brand has since grown to be worth more than $3bn, with Soare acting as chief executive and her daughter Claudia as president of the company.

Anastasia Beverly Hills has more than 20 million followers on Instagram and has collaborated with a number of high-profile influencers, including Kim Kardashian’s make-up artist Mario Dedivanovic and Instagram mogul Amra Olevic, known as AmRezy.

It has also been a long-time sponsor of reality TV show RuPaul’s Drag Race and has worked with show favourite Alyssa Edwards.

Anastasia Beverly Hills’ social media prowess has already earned it superstar status among celebrities, influencers and the general public, making it an attractive prospect for any potential buyers. 

TPG Capital acquired a minority stake in the business in 2018 as it eyed a broader push into direct-to-consumer and global expansion.

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Huda Beauty hosted a pop-up in London’s Covent Garden in February 2020

Huda Beauty

Huda Beauty was founded by YouTube vlogger Huda Kattan in 2013 after she found success on the platform with her make-up tutorials. The brand is currently the number-one account on the Instagram Beauty section.

Much like Anastasia Soare, Kattan counts stars such as the Kardashians among fans of her products, giving them a social media boost. She also creates exclusivity around the brand, which is sold in shops such as Sephora and Boots, but also hosts pop-ups like the one held in London’s Covent Garden in February.

In 2017, the company received minority investment from private-equity firm TSG Consumer, which has previously invested in cosmetics brands IT Cosmetics and Smashbox.

Both went on to be purchased by L’Oréal and Estée Lauder respectively, indicating that Huda may be heading in the same direction. 

Pat McGrath Labs

Like Charlotte Tilbury, Pat McGrath gained a reputation as a make-up artist in the world of fashion before launching her eponymous cosmetics line.

Dubbed “the most influential make-up artist in the world” by Vogue’s Anna Wintour, Pat McGrath has worked with iconic fashion designers and photographers worldwide.

Since 2004, she has also been employed by Procter & Gamble as its global beauty creative design director, helping oversee Covergirl and Max Factor, but her eponymous label Pat McGrath Labs remains independent.

While its products are priced at the higher end of the market, the brand is synonymous with McGrath’s expertise, giving it real prestige in the industry. Pat McGrath Labs is currently valued at over $1bn, making it worth more than Kylie Cosmetics.

Spectrum 

Primarily known for its wacky themed make-up brushes, Spectrum was launched by two Welsh sisters out of their parents’ garage in 2014. The business now features make-up products and other accessories as well and has launched range collaborations with franchises including Mean Girls and Disney.

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Spectrum is popular with millennial and Gen-Z consumers 

Spectrum is largely popular for its millennial appeal, using motifs such as mermaids, shells and unicorns, as well as colours like ‘millennial pink’.

Responding to the concerns of many young consumers, the products are also vegan, cruelty-free and sold at a lower price point than most brands.

While Spectrum currently has partnership deals with retailers such as Asos, PrettyLittleThing and Boots, new investment could grow its range and global appeal. 

Pixi 

Pixi, despite being founded by make-up artist Petra Strand over 20 years ago, has become a cult Instagram favourite for both its cosmetics and skincare lines in recent years. Its hero product, Glow Tonic, features in many influencer recommendations.

Pixi’s simple pastel branding represents its mission to “bring out natural beauty”. The botanically enhanced products combine make-up with skincare ingredients, bringing the best of both worlds together, which sets it apart from other cosmetics labels.

The brand has also worked with popular YouTubers, such as Caroline Hirons and Chloe Morello, to design their “dream products”, creating more buzz in the influencer universe. With a focus on quality, Pixi is ready to be taken to the next level with outside investment. 

Revolution Beauty

Revolution Beauty, formerly Makeup Revolution, was founded in 2013 by partners Adam Minto and Tom Allsworth, with the intention of creating “quality make-up accessible to everyone”.

Initially only available in Superdrug stores, the brand was catapulted to fame through influencer marketing and a number of ‘dupe’ hero products (cheaper alternatives to famous favourites). 

Revolution is extremely trend-led and low-priced, attracting a host of different types of customer. It also collaborates with influencers, much like Pixi, to create their dream products.

Like Huda Beauty, Revolution has also secured minority investment from TSG Consumer, making it a likely candidate for future acquisitions.