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November 18, 2019
Stop us if you’ve heard this before: another buzzed-about beauty brand has been acquired in a blockbuster deal, and the Kardashians remain undefeated.
On November 18th, two of beauty’s most reliable trends teamed up for the crossover event of the fall: in a $600 million deal, celebrity superstar and beauty entrepreneur Kylie Jenner sold controlling stakes in Kylie Cosmetics and Kylie Skin to beauty conglomerate Coty. Both parties framed the transaction as the beginning of a valued strategic partnership, with Jenner set to remain involved in her namesake companies in an advisory, creative role.
To better understand what led up to this landmark pairing of beauty’s youngest billionaire with one of the industry’s most storied names, Tribe Dynamics investigated the Earned Media Value (EMV) performance of Kylie Cosmetics, Kylie Skin, and notable brands from Coty’s existing portfolio, analyzing what made Jenner’s brands such enticing acquisition targets—and what their potential might entail for Coty.
A more fully realized vision of the 2015-launched Kylie Lip Kits, Kylie Cosmetics debuted in 2016 to both hype and controversy (as with most things Kardashian). While some influencers noted package and product similarities to existing offerings from other brands, Jenner’s star power quickly vaulted Kylie Cosmetics to the top of the beauty ranks, momentum sustained by the brand’s innovative DTC strategy and line of popular products.
Though Kylie Cosmetics’ solid stand-bys of Blush ($13.4M EMV), Lip Kits ($10.9M EMV), and Lip Liner ($10.7M EMV) proved the brand’s top-earning products from January to October 2019, Kylie Cosmetics also enjoyed buzz surrounding prominent collaborations with other members of the Kardashian family. The Koko Kollection, developed with sister Khloé Kardashian, netted $2.7M EMV over the time period monitored, enjoying a surge thanks to new additions released in June, while the KKW x Kylie Cosmetics line—a team up with Kim Kardashian West’s namesake beauty brand—accrued $2.0M EMV.
In addition to these standout collaborations, other members of the Kardashian-Jenner family turned out in full force for Kylie Cosmetics: Kris Jenner (@krisjenner on Instagram) and Khloé Kardashian (@khloekardashian) generated a respective $4.5M EMV and $2.2M EMV as two of the brand’s top 10 highest-earning influencers between January and October. Kylie Cosmetics also saw consistent content creation from a range of beauty blogger devotees, including Allie Binkowski (@allieballiemakeup) and Brook (@brooktiffany), who powered $6.4M EMV and $4.3M EMV across a whopping 399 and 362 pieces of content, respectively.
Capitalizing on both the ongoing skincare craze and Kylie Cosmetics’ legion of loyal fans, Kylie Skin launched to stratospheric hype in May 2019. Jenner celebrated the debut by inviting several influencer friends to a millennial pink-themed party in LA, complete with a roller skating rink and Insta-worthy photo-ops. The brand doubled-down on this influencer-friendly, experiential form of promotion throughout the year, previewing the July launch of the Summer Body Collection with a traveling #KylieTruck, where visitors could snag the new collection before its official release, and by bringing several of Jenner’s influencer besties on a celebratory trip to Turks and Caicos.
While Kylie Skin boasted strong debuts for products like the Foaming Face Wash ($1.8M EMV), Vanilla Milk Toner ($1.3M EMV), and Vitamin C Serum ($1.2M EMV), the brand as a whole saw a drop-off in content creation following its launch. After pulling in $6.2M EMV in May, Kylie Skin garnered $4.6M EMV and $4.7M EMV in June and July before dropping between $1.0M and $1.1M EMV in August, September, and October. This declining momentum—a common pattern for new brands—demonstrates the difficulty that even mega-celebrities can have while breaking into the hyper-saturated skincare market, where cult brands (and fellow acquisition targets) like Tatcha and Drunk Elephant roam.
Kylie Cosmetics and Kylie Skin may well prove to be the splashiest members of Coty’s roster of beauty brands. With $149.2M EMV generated between January and October 2019, Kylie Cosmetics outranked signature Coty portfolio members like COVERGIRL ($122.5M EMV), Rimmel ($50.2M EMV), and Wella ($21.4M EMV). Meanwhile, Kylie Skin’s proven ability to attract buzz, despite its recent slowdown, sets the brand apart amid a group whose prominent members display low year-over-year EMV growth, or slight YoY declines: though Rimmel enjoyed a 9% YoY growth, COVERGIRL, Sally Hansen, and Wella displayed respective 3%, 8%, and 11% YoY drops.
Ultimately, Coty has acquired something beyond the scope of dollars and EMV, an element as valuable as it is difficult to quantify. By taking on Kylie Cosmetics and Kylie Skin, Coty finds itself armed with not only a pair of promising companies, but possibly the internet’s single most valuable commodity: Kylie Jenner herself. And with both the Kardashian-Jenner clan and a deep squad of beauty influencers poised to demonstrate their enthusiasm for the new partnership, Coty figures to start seeing results for its latest additions very soon.
For additional insights into today’s hot indie brands that might turn into tomorrow’s multi-million acquisitions, download our Q3 Indie Debrief.
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