Christian Louboutin Beauté

PARIS — As consumers continue on their quest for all things new, the race among big players to snap up niche beauty brands intensifies.

Puig is the latest multinational to add a small label to its portfolio. The company jointly announced with Christian Louboutin on Thursday the inking of a long-term licensing agreement for beauty products.

Other niche brands recently to enter the fold of larger companies include Snowberry, a New Zealand-based prestige skin-care business, and Native, a natural deodorant company, which joined Procter & Gamble.

Edgewell Personal Care bought Jack Black. PCA Skin and EltaMD became part of Colgate. Kao purchased Oribe, while Eurazeo Brands struck a deal for Nest Fragrances and MidOcean Partners invested in BH Cosmetics.

“The big groups strive to achieve significant growth today via the acquisition of existing brands,” said Nancy Flavin, an industry consultant. “In theory, all they have to do is ‘lean-in’ — or better put, ‘plug in’ — the acquired brand [to] their existing structure, and growth will come.”

For its part, Louboutin is eager to bring his beauty products to a broader audience.

“It’s a family business: They share the same vision,” said Alexis Mourot, Louboutin’s group chief operating officer and general manager, speaking of Puig. He said the licensing deal — the company’s first — would allow Louboutin to take its beauty business “to the next level.”

Mourot noted that there are still wide swaths of geography to conquer — such as China, Latin America and many countries in Europe, including Spain — and that Puig would help it achieve much broader distribution.

He downplayed the likelihood of rapid category expansion, as Louboutin’s range already comprises products for nails, lips and eyes, plus perfumes.

The footwear guru in 2014 introduced $50 nail polishes, housed in pointy bottles reminiscent of stilettoes, after he set a joint venture with New York-based Batallure Beauty in 2013.

“This is the launch of a true luxury beauty company,” Robin Burns-McNeill, chairman of Batallure Beauty and cofounder of Christian Louboutin Beauté, said at the time.

When the deal was made, Louboutin said several parties had approached him about potential beauty ventures, given that his scarlet signature soles could translate easily into lipstick, nail polish and the like.

He noted the idea was also “in the air” with a so-called Louboutin Manicure entering the modern parlance thanks to a few enterprising London salons that painted red the underside of nails.

Mourot said the joint venture with Batallure effectively established the brand image and prestige, and now it needs more distribution muscle. Today, Louboutin is sold in 133 points of sale worldwide in 21 countries. It also counts one freestanding store, in Paris’ Galerie Véro-Dodat.

Christian Louboutin Beauté’s international expansion includes the recent opening of a corner in Milan’s Rinascente department store, its second Italian unit, in February. And late last year, Louboutin ran a pop-up nail bar at the Mandarin Oriental hotel in Paris.

Product category-wise after Louboutin debuted with nail polishes, he introduced 38 lipsticks a year later. In 2016, the high-pigmented lipstick Loubilaque and a trio of fragrances hit the market.

Louboutin then launched a fourth beauty category in March 2017, a makeup collection for eyes, including a $75 liquid eyeliner and a $70 mascara, called Lash Amplifying Lacquer. The four-product, eye-centric color-cosmetics collection bowed with very tight distribution of about 40 points of sale globally.

Industry experts agree Puig, whose beauty brand portfolio is a mix of owned and licensed labels, such as Carolina Herrera, Nina Ricci, Paco Rabanne, Jean Paul Gaultier, Penhaligon’s, Prada, Valentino and Comme des Garçons, can add to Louboutin’s fragrance know-how.

“You can’t be in beauty as a luxury brand and not be serious about perfume. It was interesting how he tackled beauty via makeup first, but this is the logical next step,” said Eva Quiroga, an analyst at Deutsche Bank. “Puig obviously has a lot of experience in fragrances and the global platform to support expansion.”

“Puig has always been very successful in working on social media, on making a brand very hype,” said an industry expert. “And Louboutin is quite a hype brand, as well.”

Puig also brings to the label critical mass in a market where size matters. “They need to have such scale because selling makeup is quite expensive, making makeup is quite expensive, and it’s important to have an international rollout,” she continued.

The Spanish beauty and fashion company has recently been acquiring and investing in niche brands — red hot market commodities these days — such as Granado. In September 2016, Puig took a minority stake in the Brazilian high-end beauty maker and retailer to help bolster that brand’s growth at home and abroad.

Louboutin can bring to Puig makeup know-how, and it’s a premium niche brand that resonates strongly in the U.S., a market where other brands run by the Spanish company generally have less of a foothold, sources said.

Puig has been gunning for growth, with a goal of reaching sales of 2 billion euros in 2017. In 2016, group revenues came in at 1.79 billion euros, up 9 percent year-over-year.

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