Recently, Estée Lauder announced that it will officially shut down its beauty brand Becca in September this year, including closing underperforming retail stores and travel retail counters, and is doing its best to transfer these employees to other brands. Becca explained that the planned closure is because "challenges have been accumulating for Becca, and the impact of the global pandemic has grown increasingly severe, exceeding Becca's business capacity."
It is understood that Becca was founded in 2001 by makeup artist Rebecca Morrice Williams and quickly gained fame for its highlighters. Around 2013, highlighters and contouring became popular makeup products, a trend that lasted until 2016, when Estée Lauder acquired Becca for $230 million. At that time, the makeup business was a highlight for the Estée Lauder Group. In 2017, Estée Lauder even stated in its financial report that Becca drove growth in makeup products.
However, as the consumer market continued to change and more emerging brands appeared, Becca's sales began to decline, its online presence shrank, and the popularity it had previously built gradually faded, leading to its eventual closure.
In recent years, consumer demand has shifted from makeup to skincare, and the pandemic has accelerated this change. Estée Lauder Group's fiscal 2021 second-quarter report showed that net sales in the makeup category fell 25% to $1.247 billion, with all brands' makeup products experiencing declines. Skincare sales, however, rose 28% to $2.819 billion, offsetting the downturn in the makeup division.
As a result, the business focus within the Estée Lauder Group has also shifted. On February 23, Estée Lauder announced an additional $1 billion investment in beauty company Deciem, increasing its stake from 29% to 76%. Deciem, the parent company of popular skincare brand The Ordinary, is estimated to be valued at $2.2 billion.
In fact, besides Estée Lauder, many other cosmetics groups are currently adjusting their brand portfolios. Shiseido also recently announced the sale of its personal care businesses, including hair care brand Tsubaki and men's skincare brand UNO.