The finish of the pandemic was speculated to usher in one other “roaring 20s”, with bumper make-up gross sales as carrying lipstick turned a “image of returning to life”. However the occasion is over for one of the crucial storied names of the make-up enterprise, after Revlon collapsed beneath the load of its money owed.
It’s a story of social media star energy trumping old-school glamour in as we speak’s magnificence business.
This week Revlon filed for chapter safety within the US, a authorized course of that permits the ailing firm to proceed buying and selling whereas it figures out methods to repay its substantial money owed. It’s a fall from grace for the 90-year-old magnificence icon, which invented matching lipstick and nail polish, and set the tempo in magnificence halls throughout a lot of the twentieth century.
Throughout its heyday, Revlon was second solely to Avon in gross sales, however in an indication of its ailing fortunes, the corporate has now fallen outdoors the highest 20, in keeping with a latest business ballot, as gross sales shift from magnificence halls to the online, and celeb manufacturers comparable to Kylie Jenner-backed Kylie Cosmetics – with its near-26 million Instagram followers – and Rihanna’s Fenty Magnificence are hailed as the brand new taste-makers.
Revlon’s monetary disaster is “not fully stunning”, says Samantha Dover, the class director of magnificence and private care analysis at Mintel. “We’ve seen from our knowledge that the restoration from Covid-19 in color cosmetics has been fairly gradual. Gross sales recovered a bit in 2021, however by nowhere close to as a lot as a variety of manufacturers hoped for.”
Because of the pandemic, ladies have turn out to be accustomed to utilizing and shopping for make-up much less regularly, with cosmetics gross sales within the UK nonetheless beneath pre-pandemic ranges, in keeping with Mintel. Within the 12 months to April 2020, 44% of ladies purchased a lipstick for themselves, however in 2021 that determine dropped to 30%. It’s again up at about 33% as we speak, however Dover says this exhibits “how demand has dropped and not likely come again but”.
The shift to dwelling working and obligatory masks inspired many ladies to neglect or ditch their make-up bag altogether, whereas the closure of division retailer magnificence halls despatched buyers to the web, a behavior that has caught. A few fifth of British ladies now purchase their make-up on-line, a determine that jumps to 52% for 16-24-year-olds.
“On-line is placing actual stress on legacy manufacturers,” says Dover. “New manufacturers are launching on a regular basis, and due to social media they’re much extra seen. You may examine costs, analysis merchandise and examine evaluations; it is more difficult and aggressive than it has ever been earlier than.”
With extra ladies taking their style cues from social media websites somewhat than shiny magazines, the massive make-up development is much less apparent than within the days when Revlon’s glamorous purple pout held sway. “Everyone isn’t contouring [a hard-to-do blending technique popularised by Kim Kardashian] or going for the ‘no-makeup make-up’ look,” says Dover. “They’re someplace on the spectrum.”
Based in 1933, Revlon is likely one of the business’s most well-known names. It was began by Charles Revson, his brother Joseph and a chemist, Charles Lachman, who contributed the L within the identify. In the course of the Nice Despair of the Nineteen Thirties, they began with a single product, a nail polish. Utilizing a blended pigment formulation, it was the primary purple nail varnish at a time when the one shades obtainable have been pale and sheer.
Named Cherries within the Snow, it was impressed by the scarlet-lipped Hollywood starlets of their day, and continues to be on sale as we speak. Lipstick turned the agency’s subsequent large merchandise in 1940 after Charles Revson seen a girl in a restaurant whose lips and nail polish didn’t match. The next promoting marketing campaign promised ladies “matching lips and fingertips”.
It has clocked up many firsts since, together with being the primary magnificence firm to characteristic a black mannequin, Naomi Sims, in its promoting in 1970. It additionally made a giant splash within the Eighties with a supermodel marketing campaign that includes the likes of Iman, Claudia Schiffer, Cindy Crawford and Christy Turlington, which promised to make ladies “unforgettable”.
Because the late Eighties, the corporate, which is listed on the New York inventory change, has been managed by the billionaire investor Ron Perelman. In 2016 it purchased Elizabeth Arden for about £600m in a transfer that added anti-ageing lotions and celeb fragrances to an organization recognized for promoting make-up and hair dye.
Nevertheless Lia Neophytou, a senior shopper analyst at GlobalData, says its perfume vary primarily includes “as soon as iconic however now drained” manufacturers, pointing to choices from pop stars comparable to Christina Aguilera and Britney Spears.
The model, with its £7 lipsticks and £9 eyeshadows, can be struggling as agile rivals attain their younger viewers on social media somewhat than by way of the cabinets of excessive avenue shops. “Revlon ought to have targeted extra of its advertising efforts on TikTok to seize impulse spending from buyers,” suggests Neophytou.
Like different corporations, Revlon, with annual gross sales of $2bn (£1.6bn), has additionally suffered from ingredient shortages and steep value rises linked to creaking world provide chains. Debra Perelman – the proprietor’s daughter, who has been operating the corporate since 2018 – insisted that “shopper demand for our merchandise stays sturdy”. “Individuals love our manufacturers and we proceed to have a wholesome market place,” she stated.
Revlon solely narrowly averted chapter final 12 months and has a $3.3bn debt pile to sort out. A method out could be a sale, and on Friday the Indian billionaire Mukesh Ambani’s Reliance Industries – which can be within the operating to purchase Boots – was linked to a potential bid.
Analysts say lipstick gross sales thrive in troublesome financial instances as small luxuries turn out to be a approach for cash-strapped customers to deal with themselves – an concept captured by the so-called “lipstick index”. However there was no post-Covid “roaring 20s” revival for Revlon – an upturn predicted by rival L’Oréal – and it’s maybe an extended shot to suppose a recession will make its lipsticks extra fascinating.