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Beauty retail openings, closures in O.C.

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FILE PHOTO BY EUGENE GARCIA, THE ORANGE COUNTY REGISTER 

Over the last few years, beauty shoppers in Orange County have seen several brands and stores come and go.

With four locations already in Orange County, beauty retailer Ulta announced three more local store openings. This month, it opened a store at The Orchard at Saddleback (23608 El Toro Rd.) in Lake Forest and will open two more locations at The Shops at Rossmoor in Seal Beach and Fashion Island in Newport Beach. The Seal Beach and Newport Beach locations are scheduled to open in the fall.

Consumer appetite for Ulta products continues to grow. Sales for comparable stores, those opened at least 14 months, rose 10.1 percent for the three months ended April 28. That’s in addition to an increase of 11.1 percent for the same period a year ago.

Ulta isn’t alone in its quest to capture a bigger slice of beauty industry sales. Sephora last year opened inside JCPenney at the Laguna Hills Mall, which also recently welcomed Sayuki Custom Cosmetics that uses a machine to create custom concealer and moisturizer. Last Friday, Anaheim-based retailer Styles for Less launched its first exclusive fragrance.

Beauty sales such as makeup, skincare, fragrance and hair products sold in U.S. department stores jumped 11 percent to $8.6 billion last year, according to The NPD Group. In 2010, they rose 4 percent. While NPD doesn’t track beauty sales to specialty stores such as Ulta, its experts say the positive trend is indicative of the entire beauty industry.

“We continue to see that consumers will opt for beauty during or shortly after difficult times,” said Karen Grant, vice president and senior global industry analyst for NPD. “While the category struggled during the worst part of the recession, an increasing number of consumers are telling us that they are factoring beauty into their budgets today. The top reason women tell us that they buy beauty is to ‘feel good about myself.’ With opening prices in prestige beauty under $30, beauty is well within the budget of many consumers.”

In 2009, private equity firm Castanea Partners paid an undisclosed sum for a majority stake in Newport Beach-based Urban Decay Cosmetics, which sells in stores like Sephora and Ulta. Castanea said Urban Decay is “known for its innovative, bold packaging and colors” and “true to its ‘Beauty with an Edge’ mantra.” Castanea liked that Urban Decay appeals to all ages.

But not everyone in the industry has enjoyed success.

Just a few months ago, behemoth drugstore company CVS Caremark Corp. shuttered its three-year-old 25-store Beauty 360 chain, which had locations in Mission Viejo and Yorba Linda. Beauty 360 featured prestige and niche beauty brands that are otherwise found at major department stores, specialty shops and spas. View photos of the Mission Viejo Beauty 360 store.

“CVS/pharmacy made the decision to close Beauty 360 stores in May of this year to refocus our efforts on the growth and development of our core CVS/pharmacy beauty business in order to satisfy a wider group of our customers,” said Erin Pensa, director of public relations for CVS. “There were many aspects of the Beauty 360 concept that were positive and we plan to apply (much of what was learned) with Beauty 360 to future enhancements within our beauty department at CVS/pharmacy.” 

In 2010, the Shu Uemura cosmetics counter inside the Brea Mall Nordstrom and store at South Coast Plaza closed. L’Oreal USA closed its U.S. operations for the Japanese brand that had been sold in the U.S. since 2004. Shu Uemura represented a small part of the luxury business for L’Oreal, which also wanted to focus on its other high-end brands like Lancôme and Kiehl’s Since 1851.

In 2009, Procter & Gamble announced that it will stop selling its Max Factor make-up brand in the U.S. because the line wasn’t popular enough to hold its own in America anymore and to focus on its more promising CoverGirl label. In Orange County, Max Factor sold in various stores, including CVS, Albertsons, Kmart, Ulta, Longs Drugs, Sears and Walmart.

Due in part to the recession, NPD said beauty sales in U.S. department stores fell 2 percent and 6 percent in 2008 and 2009, respectively.

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Beauty retail openings, closures in O.C. is a post from: Orange County Retail


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