theveganbeauty

Just a couple of items I wanted to let you know about today, primarily the sale of Cult Beauty to The Hut Group. It’s been sold for £275 million. On the one hand, great news from a home grown brand that’s being kept home grown and not being passed to venture capitalists. Cult’s steady growth came from spotting a gap in the internet beauty market very early doors and sticking with their convictions, changing with the times and being hot on predicting new brand success. What’s not so good is the way the The Hut Group is starting to dominate the beauty market in the UK. Slowly but surely, they’ve snapped up as many available e-commerce sites as they can (HQHair, Mankind, Beautyexpert, Lookfantastic, Skinstore and now Cult) they own Perricone MK, Glossybox, ESPA, Illamasqua, Grow Gorgeous, Ameliorate, Christophe Robin and more.

However, owned brands aren’t the full picture. The Hut Group acquired manufacturer and formulator business Acheson & Acheson a couple of years back and more recently have acquired a USA manufacturing site which puts them in prime position to formulate not only for their own brands but for other beauty brands, too (in fact, they already do). And that’s not all – the Hut Group also platform hosts under the TGH Ingenuity programme for brands such as Elemis, PZ Cussons, Burt’s Bees, Revolution and By Terry (to name a few). Ingenuity is an e-commerce platform and fulfilment service using data and learnings from THG brands.

What that could mean longer term for beauty consumers is a similar effect to the L’Oreal trickle down where new formulas begin with premium brands and very similar formulas (if not the same) based on the original find their way into high street brands. Which is great, if you’re aware of that and not great if you just paid £50 for something that you later find for £10 with only a whisper of difference between the two formulations. So, that’s one thing. The next is a very similar approach across the e-commerce sites – hard marketing and a disappearance of brand personalities. When THG buys a new brand, they invariably take the PR and marketing in-house which leads to a very themed approach to consumer outreach. When everything, from start to finish, is held in one place with the same marketing ethos, the opportunity for individuality disappears. In fact, the PR concept almost doesn’t exist because marketing is what they know. It will only be in the longer term that we will see whether these far reaching tentacles that lengthen so deeply into the UK beauty market affect pricing – which may well be positive – because when you control so much from start to finish, the world is pretty much your oyster. I don’t know what it means for small brands trying to make their way in beauty world but I am not sure it makes things any easier (although, like other big beauty businesses, they may well have an incubator programme).

What I like about this deal is that it IS time we stopped being dominated by the big three – L’Oreal, LVMH and ELC – but I have concerns nonetheless that the shape of our beauty landscape will be entirely formed by one company.

In other less dramatic, but still intriguing news, is the sale of Emma Hardie to Creightons. Creightons builds own brands for the high street and supermarket such as No More Frizz and Argan Body that are similar to existing popular brands without the price tag. So, Emma Hardie is a big departure for them – it’s a wonderful brand, knocked into commercial shape by Robert and Jane Foulston. Emma Hardie has its roots in self-care and self-healing so they’ll need to take care to hold its personality and address their existing audience instead of trying to throw it immediately in a new direction. I’m curious to see what happens!