Lady Gaga can add “beauty mogul” to her resume with the exclusive launch of her brand Haus Laboratories on Amazon.com Inc. in the fall.
“We are so excited for the launch of Lady Gaga’s new beauty brand, Haus Laboratories, launching this September with Amazon as the exclusive global retailer,” an Amazon
spokesperson said in a statement to MarketWatch, confirming the deal.
Beauty is among the many categories in which Amazon seeks to grow its retail business. In March, the e-commerce giant launched Belei, a private-label skincare brand comprised of 12 products including a charcoal balancing mask and dark spot solution serum.
In an overview of Amazon over the past 25 years, D.A. Davidson analysts highlight the company’s evolution from an e-commerce bookseller, to the global retailer of today, selling its own products as well as those on behalf of third parties both online and in stores.
“[T]he company has a track record of developing successful new businesses both inside of (such as the marketplace) and outside of its initial area of focus (e.g. Amazon Web Services), the retail sector,” the note said. “In many ways, its business principles that enable it to disrupt the retail market should enable it to do the same to other opportunities.”
Before we get to September, Amazon will host its annual Prime Day event, on July 15 and July 16. Amazon is making Haus Laboratories merchandise available for pre-order during the event. The event has become the kickoff to the back-to-school shopping season, drives summertime promotional events at other retailers and, this year, is incorporating a number of famous names.
“The last thing the world needs is another beauty brand,” Lady Gaga says in the introductory video on the Haus Laboratories website. “But that’s too bad.”
Actually, it could be quite good, analysts suggest, with Fenty from Gaga’s fellow Grammy-winner Rihanna and Kylie Cosmetics from Kardashian family member Kylie Jenner becoming recent blockbusters. There has been media chatter of late about ailing beauty company Coty Inc.
possibly taking a major stake in Kylie Cosmetics, to the tune of $600 million.
“The report of a $1.2 billion valuation for Kylie Cosmetics is believable, in our view, as it represents a price/sales ratio of 3.3X (Kylie reportedly had $360 million of sales in 2018),” wrote D.A. Davidson analysts led by Linda Bolton Weiser in a separate note.
“One issue with the Kylie business, in our view, is that it carries her name and that its growth has been driven by her online following. The brand could have problems maintaining momentum in the future if she ever bows out of the limelight or disengages from actively promoting the brand.”
D.A. Davidson rates Coty shares neutral.
Amazon stock is up 34% for the year to date, passing the $2,000 mark for the first time in nine months, outpacing the Amplify Online Retail ETF
, up 26%, and the S&P 500 index
, up 20% for the period.