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Business of Beauty: A Resource Guide

Modern Business of Beauty

Harris & Ewing, photographer. Testing cosmetics. Washington D.C. July 10. The department of Agriculture is making tests everyday in order to get cosmetics under the Pure Food and Drug Act, Mrs. C.W. West seated is helping Mrs. R. Goodman make a test on cold cream and other facial creams. [1937]. Library of Congress Prints and Photographs Division.

When researching the industry it may be helpful to keep in mind a few of the things that are particular to it, here are just a few to help you focus your research:

  • Revenue/Sales. Although there are some exceptions, generally speaking, for all products the higher the household income, the more people spend. That still proves true but it has also the case that because of their sheer numbers, that Generation Y and the Millennials have become a big driver of the beauty market.

Tracking of sales is done industry wide, but data is often broken by cosmetics, skin care, etc.. However, data can often be found for more specific products categories. One interesting barometer that developed in the 1930's is the lipstick effect. This is a theory that women will still buy lipstick as a little luxury even when money is tight. Sometimes nail polish is considered similar to lipstick.

  • Selling. Historically were done in local physical stores. This includes drug stores that sold consumer brands, larger general merchandise stores that sold consumer brands as well as more exclusive brands, department stores that sold premium brands, and company stores that sold only their brands. Those still exist, but there been a rise in beauty stores like Sephora, Ulta, and Bluemercury, as well as selling over the Internet from the big brands and smaller and niche brands. The growth in the variety of goods as well as short product lifecycles and constant innovations influences customers and creates more volatile demand which then feeds into the speed at which the industry operates.
  • Supply Chains & Logistics. Supply chain and logistics is a large components of the beauty industry, and affects the entire product development and delivery process. For example, some chemicals and materials needed to manufacture products are time sensitive so the manufacture and packaging process has its own time line. Added to that, technology has brought many changes to the entire supply chain and has resulted in efficiencies as well as challenges - from inventories, to turnaround times, to tracking to the entire process.
  • Regulation. Traditionally cosmetics and skin care have not been overly regulated but that has been changing somewhat with the changing nature of the products themselves. In the United States, the Food & Drug Administration as a result of the Food, Drug and Cosmetic Act passed in 1938. approves cosmetics in some situations, but does not regulate. There is also a self-regulatory group, Cosmetics Ingredient Review (CIR) run by the industry association – the Personal Care Products Council. In Europe, the EU has cosmetics regulatory authority via EU Regulation 1223/2009 External but there is also an independent group of scientists called the Scientific Committee on Consumer Safety External (SCCS).
  • An increasingly international market. While the United States, Japan, and Brazil are the countries that are top consumers of cosmetics, increasingly China, India, Mexico, and Russia are emerging as big cosmetics markets. Also, the rise of beauty trends and practices in countries like Korea (think K-beauty) and Japan (think J-beauty) play an increasingly prominent role globally. K-Beauty has become so popular that there was a K Beauty Expo held in Seoul in October 2018 that specialized in B2B exhibition of the Korean Beauty Industry and online retailer specializing in K-Beauty - Althea External - was launched to sell products around the world.
  • Influencers. The Internet with its wide reach and various social media channels like Twitter, YouTube, and Instagram, has given rise to digital "influencers." These influencers develop their personal brand though social media channels by building a loyal, and sometimes very large, following. The audiences these influencers reach is highly valued by corporations as a way to reach potential consumers who may not be plugged into more traditional advertising channels. The role of influencers has gotten to a point that in 2017 Forbes even created a list of the top influencers External and included a category for Beauty and the Federal Trade Commission addressed the issue in 16 CFR Part 255 [PDF, 93.9 KB]. There is even a twice yearly conference - Beautycon - where industry representatives, influencers, and their followers can connect. Many influencers also partner to launch their own lines or collaborations and companies like Morphe are established to be a go-to for collaborations.
  • Celebrity brands and collaborations. It is not new for stars of TV, music, and movies to be associated with particular brand increasingly, they become even more enmeshed in the beauty market. In some cases it goes beyond just being the face of a brand to collaborating on color palates for nail polishes or eye shadows. There are also those cases where stars, even influences, have developed their own lines.
  • The increasing power of the consumer. The Internet has meant people can experience brands beyond those sold in stores they have access to. Not only can they find brands that are sold in other countries, they can find niche brands and products that cater to their needs and desires. As an example, it has often been difficult for African Americans to find cosmetics that worked well. Increasingly, companies are responding and recognizing that skin come in many hues and the range for foundations needs to be more broad or at least more customizable. Another example is an increased interest in natural and organic beauty products.
  • Tracking trends. Find resources like the Pinterest 100 done annually, as well as other formal or informal sources.
  • Customization. The Internet has also made it easier to develop lines or services that allow for customization.
  • Niche or small scale brands. There has been an increasing desire to make and buy small local brands focusing on a narrow product line that sell though their own web sites or places like Etsy.
  • Growth of cosmeceuticals. Cosmeceuticals, loosely defined, are cosmetic products that have medicinal or drug-like benefits and are most commonly thought of in terms of skin care products such as anti-wrinkle and anti-aging products. Cosmeceuticals are not subject to review by the Food and Drug Administration (FDA), and the term cosmeceutical is not recognized by the Federal Food, Drug, and Cosmetic Act. They are tested for safety but there is no testing done to prove claims made by manufacturers. They are the fastest growing area of the personal care industry and mass market retailers, chain drugstores, and other mass merchandisers accounted for most sales with department stores, specialty stores, salons, etc. accounted for rest.
  • Increased interest in vegan and cruelty free products. The number of vegan brands and touting cruelty free practices has grown over the years as the interest and market for them has grown. In the United States, there is no legally defined definition or set of practices but generally none of the ingredients used in the production of the cosmetics can be tested on animals. This is not a market limited to the United States which has no official regulator for cosmetics generally speaking. Animal testing for finished products has been banned in the European Union since 2004 but brands like Leaping Bunny were developing cruelty-free brands prior to that point. In the EU there is the REACH is a regulation aims to protect human health and the environment from the risks related to chemicals substances and supports alternative methods. In China testing has evolved but products not manufactured in the country have to be tested on animals. This is also tide to what is called the Clean Beauty Movement External.
  • Packaging. Packaging has always been an essential part of beauty products as a part of the overall branding, but also to differentiate one price point from another.


To know the industry is to understand the companies that make up the industry.

There are several companies that own a number of brands. Who owns what changes over time External but below are listed some of the major cosmetics firms and their brands, as shown on their web sites as of November 2018. For those companies that are U.S. public companies, additional information about the companies, including SEC filings, annual reports, press releases, current news, and company history may be obtained from the U.S. Securities and Exchange Commission (SEC) web site.

This is a selected list of brands from a selected list of companies. To look for additional brands, the commercial site like Sephora, External Ulta, External Bluemercury, External and others can be helpful.

L'Oréal External
L’Oréal Paris Lancôme Mabelline New York
Helena Rubinstein Biotherm Shu Uemura
Kiehl's Ralph Lauren Georgio Armani
Vikto & Rolf Cacharel YSL Beauté
Diesel SkinCeutical Essie
The Body Shop IT Cosmetics Urban Decay
Garnier NYX Cosmetics  
Estée Lauder External
Estée Lauder Becca Cosmetics Aramis
Clinique Prescriptives Tommy Hilfiger
Origins Kiton M-A-C
Bobby Brown La Mer Aveda
Donna Karan (DKNY) Bumble and Bumble Joe Malone
Michael Kors Smashbox Tom Ford
Too Faced Deciem (The Ordinary, NIOD)  
Boots External
Boots No. 7 Soap & Glory
Coty External
OPI Clairol Rimmel London
Max Factor Sally Hansen Cover Girl
Wella Philosophy  
Proctor & Gamble External
Olay Vidal Sassoon Aussie
Moet-Hennessy Louis Vuitton (LVMH) External
Parfums Christian Dior Fresh Parfums Givenchy
Marc Jacobs Beauty Benefit Cosmetics Fenty Beauty by Rihanna
Make Up For Ever Kat von D Beauty Guerlain
Revlon External
Revlon Ultima II Almay
Elizabeth Arden    
Shiseido Group External
Shiseido Bare Escentuals NARS
Laura Mercier Drunk Elephant  

Other Selected Brands