CGN’s Insider Report: Amazon’s Luxury Beauty Play

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Posted October 12, 2013 by Katherine Toll in Building Your Brand
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It’s been in the works for months and Amazon finally unveiled its proud production this past Thursday: 

The Amazon Luxury Beauty Store

According to a WWD article earlier this week,

Amazon.com hopes to revolutionize how — and as importantly, where — prestige beauty products are sold.

Hmmm — that sounds vaguely familiar, doesn’t it. Sort of like…Sephora.com, or Ulta.com, or Blue Mercury.com, or Birchbox.com. Not to mention AMAZON.com — Amazon is one of my favorite go-to places for my beauty, hair, and skincare products (luxury and otherwise.)

What the hell is so new about this concept?

  • Well! First and foremost it’s a prettier version of Amazon’s typical site pages. According to WWD,

The shop, which will be featured on the home page of Amazon’s main navigation bar, is a marked departure from the more commoditized areas of the Web site. The pages are cleaner and more visual than a standard Amazon page, and the products — all of which have been photographed in-house — are larger.

Ummm — not to be a pill, BUT….so what? I really don’t care if the pictures are bigger than the rest of Amazon’s site, or they’ve been photographed in-house. The other sites mentioned above do a beautiful job of this already, but I think it’s swell that other Amazon categories are jealous of the newest one. Way to demoralize your team, Amazon.

  • Secondly, Amazon has

…. committed to selling the products at full price, or not going below the prices charged by brick-and-mortar stores.

I doubt I’m the first to say, WTF? That’s why we shop on Amazon! We can get some great prices on life’s little luxuries. Not to mention the SEC frowns upon what Amazon described — the SEC regards it as price-fixing. Just ask the legal counsel at Estee Lauder — they, along with other major beauty players settled a case in 2003 for this exact issue. Oops.

  • Last but not least, the Amazon luxury beauty sub-site is confusing. An Amazon spokesperson told WWD,

For the launch of Luxury Beauty, Amazon has signed on 24 brands. They include Nars, Stila and Vincent Longo in the makeup arena; skin care from Ahava, StriVectin, Dr. Brandt, Clark’s Botanicals and DDF; Burberry fragrances and Jack Black men’s grooming products, plus L’Occitane and Sabon, the vertical retailers.

But, wait — where’s my favorite Nuxe Body Oil, or my Davines’ Hair Primer? Both are considered ‘luxury’ brands and I’ve purchased both from Amazon. Whew! After a quick search on the Amazon site, I found them! Just not on the fancy ‘luxury beauty’ sub-site (at full price)….they can be found on the plain, old ‘beauty’ page at a cost savings.

The bottom line? The 24 brands curated on the luxury sub-site are sold to you directly by Amazon, not a third party site such as Beauty.com, or Beauty Pieces.com. Amazon only fulfills your orders from the third party sites, hence they only make money on part of the transaction, unlike their luxury beauty sub-site where they earn money on the actual (full-price) sale of the product AND the fulfillment of your order.

So – Amazon is happy and the 24 brands featured (with bigger pictures shot in-house) are happy, but it begs the question: Are Amazon customers’ happy? 


About the Author

Katherine Toll

Katherine (Kathi) Toll possesses more than 20 years of management and consulting experience within the retail and beauty industry. Her industry experience combined with her special brand of irreverence fuels her mission to find the ‘must-have’ beauty products for Career Girls of all ages. She aspires to remind women the airbrushed perfection of the beauty industry must be tempered with a healthy dose of humor. Kathi holds a general management certification from Northwestern’s Kellogg School of Management, along with an undergraduate degree from Northwestern’s School of Communications.

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