With the help of Kim Kardashian and Kylie Jenner, Coty Inc. has big plans for its skin care category, which hasn’t always been a priority for the beauty giant, according to chief executive officer Sue Nabi.
“Prior leadership teams were not familiar with skin care,” Nabi told investors at an event Wednesday at Coty’s Monaco skin care R&D and manufacturing facility. “They did not have the right tools to assess the strength of Coty’s IP in skin care, nor did they have the playbook to win in this very competitive category.”
But now, Nabi, a former skin care executive at ultra luxe Orveda, which she cofounded, believes the right team is in place to focus on growing the category. Nabi is so confident in fact, that the company released new targets to double its skin care sales, reaching between $500 million to $600 million by fiscal 2025 with even more gains to come in 2026.
“On the one hand, doubling sales in three years’ time is ambitious and by no means an easy feat as we build out our global infrastructures, reinforce our pipeline of innovations and transform our leading brands,” Nabi added. “On the other hand, $500 million to $600 million in total sales is only a fraction of the annual turnover of some of the leading global skin care brands showing that we want to be ambitious, but also credible in the targets that we said.”
The Estée Lauder Cos. Inc., for example, posted nearly $10 billion in skin care sales for its latest fiscal year.
Coty’s strategy will include taking Skkn by Kim and Kylie Skin, already anchored in North America, into EMEA in the coming years. Kylie Skin will also be heading to Australia as part of the plan, but when an investor asked about Asia, Nabi’s response what that region was not a priority for that particular brand.
Instead, the plan is to focus on Asia skin care pure players and also Lancaster, which is already in Asia and performing well, according to Nabi.
“We have so much to do with Kylie in the rest of the world. Kylie is clearly a brand that’s doing great in Anglo-Saxon countries. We recently launched it in Latin America, in Mexico, in Brazil. It’s become one of the key makeup sellers in travel retail, specifically in Europe, in London or in Paris, to take these two examples,” Nabi added. “So, honestly, we are 100 percent focused on using the brands that are powerful in the regions where they are meaningful.”
Of Kardashian’s pricey Skkn launch earlier this year, Nabi previously told WWD that it is performing above expectations and that one of the bestselling products is in fact not a product, but the full line, which retails at $673.
Coty has spent a combined $800 million for a 20 percent stake in Kardashian’s business and a majority ownership position in Kylie Beauty.
Coty also used the opportunity to announce it was raising it expectations for first-quarter like-for-like sales growth to between 8 and 9 percent, compared with the previous 6 to 8 percent target, on the back of stronger demand for beauty in both prestige and consumer and across Europe, the Americas and global travel retail. This comes despite a backdrop of record high inflation recessionary fears and rising interest rates.