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Amazon is hoping this Prime Day is a beautiful one.
The internet giant is using the online shopping extravaganza to promote its newly announced cosmetic partnership with Lady Gaga. Shoppers will be able to preorder products from the line Haus Laboratories, which launches in September. Products include a $49 set of lipstick, lip gloss and lip liner, and a pair of lip glosses for $32.
A spokesperson for Amazon did not respond to an inquiry Monday regarding how strong initial sales of the cosmetic line were on the first of the two-day shopping event, which ends at 2:59 a.m. Wednesday ET.
The partnership with Lady Gaga does not mark a new push from Amazon into cosmetics, but it is a sign of its serious intent to move into a space it has long desired — at a time when it may finally be within its reach.
"The fact that Amazon is partnering with these influencers in developing a private label business to go after a category signals how serious they are," said Vandana Radhakrishnan, a partner at consulting firm Bain & Co.
The cosmetics industry is one that is uniquely well-suited to online shopping. The products are relatively expensive, cheap to ship and frequently repurchased. Once shoppers find a product they like, there's little need to shop around further in a store or elsewhere. Meantime, the women in their 20s and 30s, who often buy color cosmetics, are a valuable demographic to recruit to join as Amazon Prime members, say industry experts.
But cosmetics has proven difficult for Amazon to conquer. Sephora, which has long prized itself as a retailer of prestige cosmetics, has in the past punished brands for selling its products on Amazon. Luxury brands like Estee Lauder and L'Oreal, which hold an inordinate amount of the industry's power, have been reluctant to sell on Amazon's no-frills shopping platform.
Those challenges haven't prevented Amazon from trying. It struck a partnership with luxury beauty line Violet Grey in 2017. This April, it announced it is launching its first dedicated skin care line, called Belei.
Now, as color cosmetics sales slow in comparison to rapid-fire growth in skin care, the tide may be turning in Amazon's favor. Cosmetics is still the largest portion of the $18.8 billion prestige beauty business, according to trade organization The NPD Group. But cosmetics last year posted only 1% sales growth over the previous year, while skin care sales grew 13% and contributed to 60% of the overall industry's growth.
The slowness in cosmetics is showing itself in the industry's titans, Sephora and Ulta, thereby possibly denting the exclusive loyalty brands feel toward them.
Ulta Beauty CEO Mary Dillon said in May the company's sales growth, while a strong 12.9%, was still dragged down by "softer" sales in prestige cosmetics. Executives have in the past indicated the legacy brands are having a hard time fending off upstart brands like Kylie Jenner's Kylie Cosmetics.
"Some of the biggest brands that had been driving growth over some time at Ulta are continuing to struggle. There's a transformation in the makeup business right now. The category remains healthy, but there's a shift in consumer preference on brand," David Kimbell, Ulta's president and chief merchandising and marketing officer, said in May.
Sephora, meantime, is giving increased space in its stores to skin care rather than cosmetics, reflecting changing habits. It is also devoting a significant amount of its prime shelf space for cosmetics to Rihanna's Fenty makeup, the highly popular line owned by its parent, LVMH.
"As these retailers shift their focus to skin and see softness [in prestige cosmetics], these brands are rightfully saying '60% of all searches are starting on Amazon, why not go to Amazon?'" said Radhakrishnan.