Ulta Beauty: Welcoming the Popular Charlotte Tilbury

January 5, 2024

Ulta Beauty (NASDAQ: ULTA), a leading beauty retailer, will from February 4th, make available the highly sought-after Charlotte Tilbury brand online at Ulta Beauty, followed by a nationwide rollout in 600 stores on February 18th. This partnership marks a significant milestone for both companies and is expected to have a positive impact on ULTA’s business.

Charlotte Tilbury has gained immense popularity and recognition in the beauty industry. According to Circana data, it was the fastest-growing brand among the top 10 prestige beauty brands and played a pivotal role in driving overall prestige growth from January to November 2023. ULTA’s Chief Merchandising Officer also revealed that the Tilbury brand garnered over one million searches on ulta.com in the past year, solidifying its position as the top prestige highlighter and face powder brand in the United States.

There are four key reasons why the addition of Charlotte Tilbury to ULTA’s brand portfolio is significant.

  • The brand has generated a tremendous amount of interest and demand, often being the subject of inquiries during management meetings and conferences. This shows a high demand for their products.
  • At a time when overall sales volume is stabilizing, the Tilbury brand is expected to positively contribute to ULTA’s pricing and product mix.
  • The arrival of Charlotte Tilbury helps offset the share pressure ULTA has experienced in the color cosmetics category, enhancing its position as a destination for prestige makeup.
  • This partnership contributes to ULTA’s strategic expansion into the luxury segment, which began in the fiscal year 2023, featuring prestigious brands such as Chanel, Dior, Gucci, Hourglass, and Tom Ford.

While the spotlight is on Charlotte Tilbury, it’s worth keeping an eye on another brand, e.l.f. Cosmetics, as it may experience interesting developments following the Tilbury launch. e.l.f. Cosmetics has positioned some of its coveted products as comparable to those offered by Charlotte Tilbury. However, the disparity in price points between the two brands, with e.l.f.’s Halo Glow Liquid Filter priced at $14 compared to Charlotte Tilbury’s Hollywood Flawless Filter at $66, suggests that the launch of Tilbury’s brand is unlikely to have a negative impact on e.l.f.’s market position.

In conclusion, ULTA’s partnership with Charlotte Tilbury is a big positive for ULTA in the prestige beauty market. The collaboration strengthens ULTA’s position as a leading beauty destination and adds to the strong brand mix that ULTA has in its arsenal. With its dominance in the attractive beauty category and concepts that continue to allow ULTA to grow beyond their core store, growth and success in their loyalty program, ULTA remains an attractive stock for investors to follow

Disclaimer: ProsperUs Head of Content & Investment Lead Billy Toh doesn’t own shares of any companies mentioned.

Billy Toh

Billy is deeply committed to making investment accessible and understandable to everyone, a principle that drives his engagement with the capital markets and his long-term investment strategies. He is currently the Head of Content & Investment Lead for Prosperus and a SGX Academy Trainer. His extensive experience spans roles as an economist at RHB Investment Bank, focusing on the Thailand and Philippines markets, and as a financial journalist at The Edge Malaysia. Additionally, his background includes valuable time spent in an asset management firm. Outside of finance, Billy enjoys meaningful conversations over coffee, keeps fit as a fitness enthusiast, and has a keen interest in technology.

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