PARIS – It’s a done deal: Sephora is acquiring Feelunique, giving it a strong foothold in the lucrative U.K. beauty market.
The news confirms a report published by WWD on July 18.
Sephora announced Friday that it has signed an agreement with Palamon Capital Partners and other shareholders to buy Feelunique, a major online beauty retailer in the U.K.
Terms of the deal were not disclosed, but a recent report in The Sunday Times of London valued Feelunique at 132 million pounds.
Sephora said the acquisition is expected to close during the second half of this year.
“The transaction is a key step in Sephora’s European growth strategy and marks a first step for Sephora’s presence into the United Kingdom, one of the top-10 biggest prestige beauty markets worldwide, with a very high level of digital adoption,” Martin Brok, president and chief executive officer of Sephora, said in a statement. “U.K. consumers have a strong appetite for a carefully curated prestige beauty offer that is tailored to their needs, and provided through a consumer-centric, seamless experience.”
“Sephora is an iconic retailer in the prestige beauty space in Europe. We are looking forward to working together and leverage our respective strengths to drive the prestige beauty segment in the U.K.,” said Sarah Miles, CEO of Feelunique.
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As Harrods rolls out freestanding beauty stores across the country and Boots updates its offer and refurbishes stores there, Sephora is seeking to make new inroads in the U.K. The LVMH Moët Hennessy Louis Vuitton-owned retail giant has long been locked out of the U.K. market, because of the dominance of Boots. (Ironically, Boots previously owned Sephora, but sold it to LVMH in 2017. At the time, Sephora wasn’t profitable, and so Boots sold it to focus on the U.K. market.)
Additionally, because of duties resulting from Brexit, Sephora no longer delivers products to the U.K.
In 2000, Sephora opened its first U.K. location at the Bluewater Mall in Kent. Five years later, in April 2005, WWD reported the retailer would close all nine of its U.K. stores. Three of its U.K. outposts had already shuttered by then. The original idea had been to open 50 Sephora locations in the British market within a few years, but there was fierce competition from Boots, as well as upmarket beauty retailers such as Space NK.
Today, Sephora keeps pushing into the online space in Europe.
As reported in June, the beauty retailer signed a longterm strategic partnership with Zalando to create a prestige beauty experience online, starting in Germany in the fourth quarter of this year.
A sale has been a long time coming for Feelunique. At the end of 2018, its owners called off another sale after bidders did not match the site’s valuation of 200 million pounds.
Not long after, Joël Palix, Feelunique’s longtime CEO, exited the company and was succeeded by Miles. She joined from Amazon Inc., where she had served as EU marketing and new business director at Amazon Fashion.
Feelunique, which has both retail and marketplace channels, was founded in 2005. It counts 1.3 million active customers, and more than 35,000 cosmetics and fragrance product from over 800 brands, from the most established to niche. The platform offers makeup, skin care, hair care, fragrance, accessories, devices and sexual wellness products.
The company ships to more than 120 countries and boasts dedicated websites in European Union countries, including France, Germany and Norway, as well as the U.S. and China.
The bulk of Feelunique’s sales stem from Generation Z consumers and Millennials under the age of 35.
The company said in 2020 it achieved “record levels” of sales and customer acquisition numbers. Sales are thought to be in the neighborhood of 120 million pounds.
The U.K.’s cosmetics and personal care market was worth $10.66 billion in 2019, placing it in Europe behind Germany, with sales of $14.05 billion, and France, with sales of $14.44 billion, according to Statista.
Today, the U.K. beauty market is percolating with many high-street giants looking to woo the British beauty customer.
Last year, Boohoo bought the defunct Debenhams, and said it plans to leverage the department store’s beauty brand relationships and cultivate its loyal clientele in that space.
Boohoo and its rival Asos are undoubtedly eying the success that British fashion and lifestyle giant Next has had in the sector.
In 2019, Next bought the online premium and wellbeing retailer Fabled by Marie Claire from Ocado Group and began rolling out physical beauty and home concept stores in the U.K. to house the hundreds of labels it carries.
Then there’s Amazon, which has been building premium beauty brands, including RéVive Skincare and Clé de Peau Beauté, into its new Amazon Luxury Store offer.
Beauty’s retail landscape – both on- and offline – keeps morphing at warp speed around the globe, including tie-ups like Sephora’s longterm partnership signed with Kohl’s Corp. in the U.S. in December 2020. That deal calls for the opening of 850 Sephora and Kohl’s shop-in-shops over the next three years.
The move marked an escalation in the increasingly competitive battlefield of prestige beauty, coming just three weeks after Ulta Beauty unveiled a deal with Target to open 100 shop-in-shops in the second half of 2021.
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