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Analyze That: Can Prestige Makeup’s Biggest Players Make a Comeback?

With color cosmetics sales in the U.S. facing steep declines due to the coronavirus pandemic, the biggest brands are hurting the most.

Will the coronavirus pandemic be the tipping point to knock prestige makeup’s biggest players off the map?

Color cosmetics sales in the U.S. were already on the decline before COVID-19 hit. The category ended 2019 with a 7 percent drop, according to data from The NPD group. It was a stark contrast from just a few years ago, when makeup was hotter than hot and posting year-over-year double-digit or more sales gains. After years of watching YouTube videos featuring 20-plus products to achieve a “no-makeup makeup” look, it seemed that consumers might finally be getting ready to take the “no makeup” thing literally.

Cut to now, and the pandemic has pushed that burgeoning behavior into overdrive. Makeup sales plunged to $869 million in the second quarter, down 52 percent year-over-year according to NPD, making it the hardest hit category within total beauty. Even with retail stores opening back up for business and with e-commerce sales growing, NPD expects makeup to likely end the year in a decline somewhere around the 30 percent range.

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Meanwhile, the skin-care and hair-care categories have suffered significantly less, and smaller categories such as home fragrance, hair color and nails have seen unprecedented growth, fueled by consumer desire for DIY-spa-like experiences at home. 

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As many consumers settle into work-from-home routines and don masks instead of makeup out in public, “the biggest bleeds” in the category are coming from the top 10 biggest brands, said Larissa Jensen, beauty industry adviser for NPD, a group that includes legacy labels such as MAC, Too Faced and Lancôme.

It’s the big brands that are seeing less traction on social media as well. In July, Anastasia Beverly Hills tracked a 47 percent year-over-year decline in earned media value, according to Tribe Dynamics. Other brands in Tribe’s top 10 list that experienced dramatic year-over-year decreases were ColourPop (down 38 percent), Huda Beauty (down 33 percent), NYX (down 32 percent), MAC (down 33 percent) and Urban Decay (down 23 percent). Meanwhile, buzzy new names like Hollywood makeup artist-turned-social-media-star Patrick Ta’s line and influencer Patrick Starrr’s new brand, One/Size, tracked significant EMV growth.

The steep decline in sales and the sharp shift in social media attention have some in the industry wondering if the makeup power brands of yore that once seemed unstoppable have had their day.

Many of the biggest brands, such as the The Estée Lauder Cos.-owned Too Faced, which just named former Ulta Beauty chief merchandiser Tara Simon as its new senior vice president and global general manager, are set to face the most collateral damage from the coronavirus. They are at a critical turning point, as foot traffic in U.S. malls and department stores—the biggest points of distribution for these brands—remains down and retailers including Barneys New York to Lord & Taylor go bankrupt. Meanwhile, beauty’s biggest specialty retailers in the U.S., Sephora and Ulta, are dedicating more space to skin care and less to makeup.

Experts aren’t convinced that makeup will return to its 2016 heyday of meteoric growth, but they’re not ready to sound a death knell, either. Those who spoke to Beauty Inc agreed that the category’s biggest brands will need to readjust to a new reality in order to make a comeback.

“All of these brands have something interesting [going for them,]” said Lucie Greene, founder of The Light Years consultancy. “They all got popular for a reason, but they haven’t all moved on. In a very crowded landscape, assessing your brand and cultural relevance is quite important.”

“The drop-off in makeup [due to COVID-19] wasn’t a huge surprise—the magnitude was, but the direction wasn’t,” said Stephanie Wissink, managing director at Jeffries. “Pre-COVID-19, makeup had turned negative, and in my view, that was a product of the cycle, coming off a high in 2017….the philosophy of [less makeup use] was there, and COVID-19 gave her an excuse [to wear much less.]”

Prior to the pandemic, makeup sales were expected to return to growth in 2021. Wissink forecasts that makeup will eventually stabilize once the crisis subsides, but believes that there will probably be long-term effects on the way consumers want to wear it.

“The combination of factors that led to explosive growth in makeup [a few years ago] are not likely to occur again, at least in my career,” she said. “That was such an unusual combination of things that to recur seems very unlikely. However…does she go back to wearing makeup? Absolutely. But does she go back to six layers and highly defined cheekbones and the explosive level of artistry we saw? I don’t know that we do.”

A few years ago, brands like Too Faced, Urban Decay and Becca swelled in size thanks to influencers using their products to strobe, contour and bake—techniques that seemed novel and exciting at the time. Layers of makeup were in, and the more products the better.

But those 20-plus step routines just aren’t what young consumers driving the popular looks on new social platforms such as TikTok  are interested in, and it may be time for brands to move on from the concepts that once propelled them. 

“There’s way too much product on the market—we’re seeing this across the board—and there’s been this backlash to all this extra stuff,” said Edwin Burstell, a retail and beauty consultant who helped set off the boom over the course of his career at Henri Bendel, Bergdorf Goodman and Liberty. “Brands have to be considered, but they also have to check all the boxes that Gen Z want.”

For Gen Z, those boxes include a focus on sustainability, meaning environmentally friendly packaging, ingredient transparency and commitment to social responsibility.

The younger generation is looking for authentic founder stories and a chance to be included in the development process, agreed Greene. She cited Florence by Mills, the makeup brand founded by Millie Bobby Brown in conjunction with incubator Beach House, as an example of this. “The initial appeal of the [big makeup brands] is that they were independent, and now that they’re powerhouses—they’ve come so far from their founder stories,” she said. “Now you see these incubated brands launched by influencers and there’s a much more direct dialogue with the consumer around the development process.”

Burstell’s feeling is that beauty consumers may be getting fatigued by the average influencer, and when it comes to makeup brands, they are more likely to latch on to a brand that is backed by an authoritative voice. “I can’t get past the idea of whacking out some crummy palette versus Pat McGrath, who has been at the peak of her career for 20 years.”

Eyeshadow palettes are indeed not doing well at the moment, said NPD’s Jensen, though she noted that over the summer, some other eye makeup categories such as mascara and eyeliner have begun to show growth. “How many palettes does the consumer really need?” she added.

Burstell pointed to McGrath’s brand, as well as Selena Gomez’s recently launched Rare Beauty (currently a top-seller on as modern makeup brands he believes to have real potential. “Without the skill [to show off], what’s the point? You can only hype things up so much.”