We were a little surprised to see that high-end Japanese brand Shiseido is making a play for mineral makeup guru Bare Escentuals. It’s going to buy the American company for $1.7 billion.
Why were we taken aback? Well, you know, Shiseido is a bit lofty, while Bare Escentuals does infomercials. On the surface, this seems like an odd pairing. Shiseido also owns Nars, Carita skincare and Beauté Prestige International (including fragrances from Jean Paul Gaultier and Narciso Rodriguez). Those brands fit a profile that mass market Bare Escentuals does not.
However, after further research, we think Shiseido is making the right choice. Here’s why:
Bare Escentuals is a cash cow and it can get even fatter. The company’s sales reached $556 million in 2008, but 85% of those sales were in the US. With Shiseido’s deep infrastructure in Asia, Bare Escentuals is bound to blow up there as well.
It really was the first big mineral makeup player. While we personally prefer liquid makeup over mineral, it’s obviously become a big part of the average American woman’s beauty routine, and Bare Essential is recognized as the pioneer. Shiseido can now incorporate Bare’s technology into its own line.
Shiseido needs to up its US profile. Sure, those of us who work in fashion and beauty know what Shiseido is, but does the random 55-year-old housewife whose favorite beauty brand is Clinique? Probably not. While it definitely shouldn’t go down market, being known as, say, “the Chanel Beauté of Japan” by a broad US audience would definitely be a good thing. Right now, just 8% of Shiseido’s sales are generated in the US.
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Bare Escentuals, guys. Please fact check!
Bare Escentuals, guys. Please fact check!
Nice. Loving your posts so far, Lauren! You’re making me interested in the businessy side of fashion!
Nice. Loving your posts so far, Lauren! You’re making me interested in the businessy side of fashion!
It’s fixed!
It’s fixed!
You missed a few of the Bare Essentials (spelling-wise, I mean). But interesting and thoughtful article.
You missed a few of the Bare Essentials (spelling-wise, I mean). But interesting and thoughtful article.
Fixed and fixed. Sorry guys–I know misspellings take away from a story’s value. It won’t happen again!
Fixed and fixed. Sorry guys–I know misspellings take away from a story’s value. It won’t happen again!
Great story. I would also add that BARE offers: 1) a diversifed business model, selling products in own stores and in competition (think Ulta Salon, or Sephora), (2) productive branded store fleet (ROE/ROA), and competitive advantage in the type of customer service offered (seems more personal to me than department stores).
Great story. I would also add that BARE offers: 1) a diversifed business model, selling products in own stores and in competition (think Ulta Salon, or Sephora), (2) productive branded store fleet (ROE/ROA), and competitive advantage in the type of customer service offered (seems more personal to me than department stores).
Interesting! Have to say though, the two brands I use every day are Nars and BE- so it may not be as strange as you think. I’ve tried other mineral makeup and BE is clearly the best. I think it’s a great partnership. And I totally agree that it will become HUGE in Asia.
Interesting! Have to say though, the two brands I use every day are Nars and BE- so it may not be as strange as you think. I’ve tried other mineral makeup and BE is clearly the best. I think it’s a great partnership. And I totally agree that it will become HUGE in Asia.
I like Fashionista, but quite a bitchy comment about 55 year old housewives liking Clinique. I’m a 26 year old luxury goods lawyer and love Clinique. If you’re trying to avoid the haughty category of fashion blogs, I suggest adjusting such misconceptions and snobby categorizations that only supremely expensive make-up brands are worthwhile, and that 55 year old housewives are provincial. Tasteless, classless reference.
I like Fashionista, but quite a bitchy comment about 55 year old housewives liking Clinique. I’m a 26 year old luxury goods lawyer and love Clinique. If you’re trying to avoid the haughty category of fashion blogs, I suggest adjusting such misconceptions and snobby categorizations that only supremely expensive make-up brands are worthwhile, and that 55 year old housewives are provincial. Tasteless, classless reference.
#8, I read the Clinique reference in the post as a way to show a well known American makeup brand, and didn’t get the snobby vibe at all. It’s a fact that the average beauty consumer in the US has heard of Clinique, (and has a product or two in their makeup bag) and not Shiseido.
Not a “tasteless, classless reference” Lauren!
#8, I read the Clinique reference in the post as a way to show a well known American makeup brand, and didn’t get the snobby vibe at all. It’s a fact that the average beauty consumer in the US has heard of Clinique, (and has a product or two in their makeup bag) and not Shiseido.
Not a “tasteless, classless reference” Lauren!
Am I the only one who thinks this is an obvious business decision? In my mind it is like Gucci Group buying Opening Ceremoy. Huge international prestige brand gets a cult cash cow…
Am I the only one who thinks this is an obvious business decision? In my mind it is like Gucci Group buying Opening Ceremoy. Huge international prestige brand gets a cult cash cow…
ditto #9- I’m 21 and in fashion and I adore Clinique (it’s pretty much all I wear- makes your skin look great and not all break-outty) but I definitely agree with the fact that it’s a pretty classic American beauty brand with which the average American consumer can relate. You could easily insert Bobbi Brown or Estee Lauder and get the same effect- I don’t think it was an attempt to diss Clinique. The point was that Shiseido’s not so recognizable and snagging a brand people worship (legit, people go to instores to get their foundation signed by the inventor) is likely a good call.
ditto #9- I’m 21 and in fashion and I adore Clinique (it’s pretty much all I wear- makes your skin look great and not all break-outty) but I definitely agree with the fact that it’s a pretty classic American beauty brand with which the average American consumer can relate. You could easily insert Bobbi Brown or Estee Lauder and get the same effect- I don’t think it was an attempt to diss Clinique. The point was that Shiseido’s not so recognizable and snagging a brand people worship (legit, people go to instores to get their foundation signed by the inventor) is likely a good call.
#8 I wear Clinique everyday. (Their Perfectly Real makeup is amazing.) My point is that most consumers haven’t heard of Shiseido. Everyone has heard of Clinique.
#11 If you were miraculously not joking about the Gucci Group buying Opening Ceremony, email me ASAP! lauren@fashionista.com
#8 I wear Clinique everyday. (Their Perfectly Real makeup is amazing.) My point is that most consumers haven’t heard of Shiseido. Everyone has heard of Clinique.
#11 If you were miraculously not joking about the Gucci Group buying Opening Ceremony, email me ASAP! lauren@fashionista.com
This is just a personal gripe (for all the darker-skinned gals out there) but Bare Escentuals mineral makeup looks horrible on dark skin. I really hope they will come up with a good formula and many more options, but I don’t know if a Japanese brand buying them will make that happen.
This is just a personal gripe (for all the darker-skinned gals out there) but Bare Escentuals mineral makeup looks horrible on dark skin. I really hope they will come up with a good formula and many more options, but I don’t know if a Japanese brand buying them will make that happen.
I kinda agree with #8, not so much on the Clinque comment, but the overall tone. Bare Escentuals may do informercials and may not be as pricey as Shiseido, but I think it’s just as good a product as anything Shiseido has. I’m a make up junkie who’s used all the above mentioned brands, and of the three I’d use Bare Escentuals over the rest (but only if I could never use Benefit again).
I kinda agree with #8, not so much on the Clinque comment, but the overall tone. Bare Escentuals may do informercials and may not be as pricey as Shiseido, but I think it’s just as good a product as anything Shiseido has. I’m a make up junkie who’s used all the above mentioned brands, and of the three I’d use Bare Escentuals over the rest (but only if I could never use Benefit again).