Retail

Glossier is moving into Nordstrom with mini shops for its perfume, which has a cult-like following

Key Points
  • Glossier taps Nordstrom's bricks and mortar for pop-up shops.
  • The beauty business aims to sell more perfume.
  • Nordstrom has a history of working with up-and-coming e-commerce brands.
A rendering of the Glossier shops coming to seven Nordstrom locations, including at the new Nordstrom flagship in New York City.
Source: Glossier

A beauty business born on the internet is teaming up with a department store chain that has plenty of bricks and mortar.

Glossier, known for its blush-pink aesthetic and popular make-up products, is opening temporary shops within seven of Nordstrom's stores, including the new Nordstrom flagship location in New York, from Dec. 3 through Feb. 16. The beauty company will only be selling its "Glossier You" fragrance, which it launched in October 2017. The item has since become one of the highest-rated products on Glossier.com.

"Fragrance is an extremely personal category — one that people understandably prefer to discover in person — and department stores are the largest channel for fragrance, making up nearly a quarter of all U.S. fragrance sales," Glossier founder and CEO Emily Weiss told CNBC.

For Glossier, a tie-up with Nordstrom, albeit a temporary one, should help the company get in front of more shoppers who don't currently live near one of its two stores in New York and Los Angeles. Glossier has operated its own pop-up shops in cities like Boston, Austin, Miami and London. But, for the most part, it has thrived online since its inception in 2014, selling soft pink-colored lip balms, lotions and lash products.

Nordstrom, meantime, has a reputation in the industry for being a sought-after partner for up-and-coming e-commerce brands that are looking to expand. Some of the names in its new New York flagship, for example, include ballet-flats maker Birdies, apparel retailer Reformation, jeweler Kendra Scott and health-focused beverage company Dirty Lemon. Nordstrom has also worked with the trendy luggage company Away, shoe retailer Allbirds and apparel maker Everlane.

"We feel confident that with Nordstrom as our partner, we'll be able to maintain our extremely high bar for customer experience," Glossier's Weiss said.

She added that Glossier was "highly involved" in the hiring and training process for the sales associates who will staff the seven shops into 2020.

In addition to New York, the six other Glossier spaces will be at Nordstrom locations in Seattle, Chicago, Dallas, Houston, Washington, D.C., and Santa Anita, California.

The move into Nordstrom comes as Glossier's business has been on a tear. In 2018, the company surpassed $100 million in annual sales while acquiring 1 million new customers. It sold one of its famous Boy Brow eyebrow-shaping products every 32 seconds last year.

To help fuel this growth, Glossier secured $100 million in fresh funding, led by Sequoia Capital, earlier this year, bringing its valuation to $1.2 billion. It has raised $186 million in venture capital from Tiger Global Management, Spark Capital and others.

CNBC also reported in September that Glossier had poached a top Amazon exec, Melissa Eamer, to become chief operating officer.

As department store chains like Nordstrom, Macy's and Kohl's are hunting for ways to lure shoppers into stores and win sales, it's no surprise they're trying to work with some of the younger, more popular names in retail. Macy's and Kohl's both have opened marketplaces in their stores where newer brands rotate in and out.

The beauty counters at department stores have been hurt as companies like Ulta and Sephora have expanded their footprints, pulling shoppers out malls and into their stores. Saks Fifth Avenue moved its beauty merchandise, which had traditionally been on the lower level, to the second floor in 2018. Some analysts said the move by Saks hinted at how shoppers aren't shopping for make-up like they used to.

Glossier said it doesn't currently have plans to do anything else with Nordstrom, beyond these pop-up shops.

Nordstrom shares are down about 19.5% since the start of the year. The company has a market cap of roughly $5.8 billion.

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