The beauty industry’s mass market may be in a state of flux, but Target is only going up.
The company’s last earnings report showed that along with fashion, beauty drove 2.7% growth in the second quarter, with net sales totaling $25.5 billion, beating Wall Street expectations. Of this, the beauty category increased by 9% on a comparable basis, on top of double-digit growth in the previous year.
Rick Gomez, Target’s executive vice president and chief commercial officer, said in a wide-ranging interview with WWD that the secret is the right brand mix, a wide range of price points, an integrated digital strategy and a willingness to jump on trends. he said.
“Beauty at Target is a fast-growing business for us. For the past five years, we have continued to grow every year, so much so that our beauty business has actually doubled in size since 2019. ,” Gomez said.
This success stands in contrast to the broader mass market. According to Circana, in the first half of the year in the U.S., hair care and skin care grew by only 2 percent and 1 percent, respectively, while fragrances fell by 1 percent and makeup by 4 percent.
Among many other factors, Gomez attributes Target’s growth to having the right assortment at the right time.
“Beauty is all about newness and innovation. Consumers want to try new products and new brands, and we have made a big commitment to launch new products this year,” he said, adding that in 2025 It added that thousands of inventory storage units will be launched in 2020.
Among the successful launches is Blake Brown, a hair care brand launched by Give Back Beauty in collaboration with founder Blake Lively, which was in the top five best-selling hair care items at Target on launch day alone. . “This is the largest hair care product launch in Target’s history,” Gomez said. “If we can get the right product that’s on-trend and at a good price, we know it’s really good for us.”
Gomez also mentioned Tabitha Brown’s Donna’s Recipe and Jennifer Aniston’s LolaVie, as well as L’Oréal’s Color Sonic (available exclusively at Target). The latter is available through Target’s partnership with Ulta Beauty, which currently has shop-in-shops in about 800 doors, giving Target’s assortment a wide price range.
“Fifty percent of our (beauty) assortment is under $10, but consumers are looking for quality products, and value is important when it comes to buying luxury products,” Gomez said. . “It’s important to us to offer a wide range of value across all price points and to offer quality products at affordable prices.”
Target’s Beauty Shopper price range is similarly wide. “We have a broad consumer base of varying ages and geographies, with a wide range of products from Generation Alpha to consumers over 55. We strive to offer something for everyone. ” he said. “Gen Alpha may prefer fun brands like Elf Cosmetics, while consumers over 55 may prefer brands like Rock Skin Care.”
While many successful brands include famous founders, Gomez says they are only part of Target’s brand formula. “We’re not a catalog. We’re very selective about which brands we carry,” he said. “We’re looking at prestige brands, emerging brands, digitally native brands, and of course our own brands. That’s the magic combination.”
In some cases, this involves thinking small and focusing on micro-trends to guide the market into broader growth areas. “Trends come from social. Unbrush was trending on TikTok. We jumped on it and within eight weeks we were able to display Unbrush in our stores. Since then, we’ve sold 27 colors. . It’s been a big hit and a big driver of growth.”
One company highlighted Target’s willingness to spot trends at an early stage and capitalize on them early.
Provided by Rick Gomez
“What sets Target apart is that we’re culturally sensitive and we’re sensitive to megatrends,” said Mesa’s chief marketing and brand owner, who owns the Finely, Being French and Christine S. Hare brands. says the person in charge, Osh Savour. Sold at Target. “Working with them as an incubator allows them to see what we see and validate trends.”
As an example, Saveur pointed to Mesa’s fragrance brand Finely, which debuted as a Target exclusive in 2023. “They had an instinct and carved out a space on the planogram and backed it up in a way that could be expanded,” she said.
At the time of Fine’ry’s launch, industry observers estimated sales at more than $20 million.
“We knew fragrance was a breakthrough category during COVID-19, but many people were starting to move away from fragrance. They were able to turn things around and work with us to launch the brand at the very height of the growth that is happening,” Saveur added.
Spotting trends early and finding the next big thing is nothing new for Target. The company was Elf Beauty’s first retail partner in 2005. Almost two decades later, that partnership is still thriving.
“We are their number one brand, representing more than 20% of all categories,” Elf Beauty CEO Taran Amin said in a recent interview.
When it comes to Target’s digital strategy, it’s not limited to social media trends, as Gomez gears up to test new technologies to improve the user experience.
“That’s 20% of the business,” Gomez said of Target’s digital beauty sales. “We are focusing on new technology that enables things like virtual try-on of lips, eyes, and foundation. This becomes a resource for learning about products and allows shoppers to go to the store and buy. It’s really omnichannel. Instead of thinking of it as in-store shopping and then digital shopping, we think of it as shopping all the time. You can often see people there.”
Another major growth area is mini-businesses, which have more than doubled in the past three years. According to Gomez, there are many opportunities there.
“There’s a travel business and there’s a lot of experimentation and trying new things,” Gomez said. “We’re seeing people try the mini size and then buy the full size, and that’s an area we’ll continue to focus on.
“I think minis are the perfect stocking stuffer this holiday season. They’re also great for everyday use like hand sanitizer and lip balm,” he continued. “So minis are definitely a trend that will continue through back-to-school and into the holiday season.”
