The Future. Although celebrities and investors were drawn to the beauty industry because of the daily use of the products and high operating margins, the economy has slowed down, and tastes have changed. Now, celebrity-backed brands have fallen out of vogue in favor of makeup brands that feel legit. In a world now prioritizing authenticity (in both makeup habits and life), only the brands that feel like genuine extensions of their celebrity face may survive.
According to Bloomberg, 50 celebrities and influencers have launched some sort of beauty brand in the past three years… and the money is now running dry.
- A flood of reviews on TikTok and Reddit pointed out that many celebrity-driven brands aren’t high quality and don’t feel authentic to the name involved.
- A Bloomberg survey found that female shoppers don’t even care if a celebrity is involved with a brand.
Lately, the focus has transformed from makeup to skincare thanks to the rise of the “clean girl aesthetic.” Basically, people are wearing less makeup overall.
To get a sense of how damaged the celebrity-driven beauty industry is, just look at the business moves of this past January.
- Kristen Bell closed her Happy Dance skincare line.
- Sephora discontinued selling brands from Addison Rae and Hyram Yarbo.
- Ariana Grande purchased the remaining product of her r.e.m. beauty brand when its parent company, Forma Brands, started tanking.
And while many of these celebrity-backed brands started with the intent to one day score a big payout when a larger company acquires their brand, that’s not as common as it is in, say, liquor. Since 1994, only one brand has received a deal like that in North America: Coty’s $600 million acquisition of Kylie Jenner’s Kylie Cosmetics in 2019.