Everyone wants to be a prestige beauty retailer now

Once upon a time, an air of exclusivity enveloped the sale of prestige beauty products.

At the turn of the 21st century, department stores existed as the destination for high-end beauty, with kiosks helmed by salespeople ready to color match a foundation or spritz a perfume. Then, in the early 2000s, Sephora’s open-sell concept quickly gained momentum, while Ulta Beauty’s high-low strategy made inroads with consumers in the 2010s, leading to the continual decline of department stores. Mass retailers and drugstore chains, meanwhile, continued to play within lower-priced beauty as they had for decades.

But with the rise of premium beauty on TikTok Shop and Amazon, “discovery happens everywhere now,” Jacqueline Flam Stokes, managing director of beauty & health at NielsenIQ, told Retail Brew. Shoppers have become “channel agnostic,” and, seeing the opportunity within the booming beauty industry, retailers and brands increasingly have, too.

Now, the philosophy around beauty distribution feels like everything everywhere all at once: The same dry shampoo can be sold on the shelves of Sephora and Walmart, the same lipstick at a Macy’s counter and on TikTok Shop.

Target’s forthcoming Beauty Studio aims to push the retailer into prestige, while Walmart is shaping itself into a premium beauty “destination,” Silvia Azrai Kawas, EVP of consumable at Walmart US, told Retail Brew. They’re among many retailers and brands vying to outsparkle their beauty competitors with major moves that alter how they—and the entire beauty retail industry—operates.

Crossing the aisle

Mass and drug retailers have been trying to make the push into higher-priced beauty, with limited success, for some time. CVS opened a high-end beauty concept, Beauty 360, in 2008. By 2012, it was closed, hampered by competition from department stores, specialty retailers like Sephora, and the economic downturn.

At the time, many retailers had an “If I build it, they will come” mentality, Stokes said, but brands weren’t buying it. They feared that entering the mass market would erode brand equity, and tarnish their image as a premium product, ultimately precluding them from selling in prestige channels, Stokes said.

Linda Voracek is founder and CEO of retail consultancy Lmv & Co and former merchandising exec at Sally Beauty and Longs Drug Stores, which was bought by CVS in 2008. She recalled that when first introducing Longs’s Healthy Skin Care Center labs in stores, which featured brands like La Roche-Posay, “it was a lot to convince [premium brands] to be able to come into a drugstore.”

“Brands don’t want to be the first one that steps over,” Voracek said.

But attitudes have evolved. As the department store channel has faltered, giants like Estée Lauder have been pulling back at those stores amid a shift toward high-growth channels like Amazon and TikTok Shop. Amazon, which accounts for a quarter of US beauty sales after its sales grew nearly 20% to reach $34 billion last year, has attracted the likes of Charlotte Tilbury and Sol de Janeiro to its Premium Beauty store, and TikTok Shop, featuring sellers like Clinique and Glossier, has become the fourth-ranked US health and beauty e-commerce retailer in 2026, per NielsenIQ.

Those platforms have established a “democratization of distribution,” transferring some power from specialty beauty’s hands into those of brands, Stokes said.

“The stronghold that beauty specialty has with brands loosened a little bit when you see that Amazon is now the largest beauty retailer in the US,” she said. Amid this, consumers have shown they’re increasingly “fluid,” simply wanting “the right product at the right price in the right moment,” which has made retailers and brands more willing to cross the boundaries of mass and prestige.

“We still have some clients that say, ‘Oh, I only want to look at the prestige market,’ or, ‘We only want to look at the mass market,’” Stokes said. “Well, you can’t look at the world with that type of view, with those blinders on anymore; 99% of prestige shoppers have also purchased mass products in the last year, so people are not doing one or the other anymore.”

Mass makeover

Recognizing this shift, many retailers are priming their beauty aisles for premium or prestige beauty. Urban Outfitters—aiming to become a “beauty empire,” Karen Booker, its head of merchandising for non-apparel, told Business of Fashion—has recently brought on Sol de Janeiro and Yes Day. CVS is again making a play at premium, with an assortment that now includes specialty staples Vacation and Color Wow, and even Gap this summer launched in-house brand Gap Beauty, starting with a “reimagination” of its ’90s fragrance.

Traditionally known for its low-priced mass assortment, Walmart last year added 100 premium brands, and over 40 more this year, focusing on haircare and skincare, including Living Proof and Murad, two brands also sold at Sephora, with prices reaching the $90 range. Walmart has also been placing its beauty section in the front of remodeled stores, Kawas said.

The push into premium comes as Walmart has seen increased beauty demand from higher-income customers, noticing search cues for brands the retailer didn’t carry, according to Kawas. Now, Walmart sees beauty as a “critical path” to introduce younger customers to the retailer and integrate into their routines, and ultimately promote larger baskets, she said.

On September 10, Target is making its first solo attempts at selling prestige with the debut of Target Beauty Studio, which will feature over 60 new brands following the conclusion of its Ulta shop-in-shop partnership in August. Hitting 600 stores—about a quarter of its fleet—the Target Beauty Studio continues its momentum in beauty and takes a page out of Ulta’s playbook by offering consumers both prestige and mass beauty in one place.

A brand list on Target’s website names several holdovers from the Ulta shops, including Sunday Riley, Tula Skincare, and First Aid Beauty, along with a slew of K-beauty brands, fragrance brands like Boy Smells, and haircare brands like Briogio. The planned store count aligns with the 610 stores that previously featured Ulta shop-in-shops, and the location list for its Beauty Studios is identical to that of its Ulta Beauty in Target list. When Retail Brew reached Target for comment, we were directed to Target’s press release shared in March.

Brand new

As Stokes noted, retailers’ strategy shifts can only succeed if brands are on board. Noticing the same evolving consumer behavior retailers have, sunscreen brand Supergoop! this year expanded its channel horizons. Supergoop! chose Sephora as the brand’s first retail partnership in 2011, and was “born in prestige,” Katie Glowski, Supergoop!’s SVP, GM of North America sales and former sales lead at L’Oréal and Estée Lauder, told Retail Brew. But when Glowski joined the brand in 2024, it became clear its strategy needed to evolve.

“If we wanted to stay grounded in our mission, we needed to drive accessibility, and we started having some conversations of what that could look like,” she said.

The company recognized the size of the SPF market in mass, and thus a “large opportunity to reach a much broader audience,” she said. In January, the brand made its mass debut at Target and launched a storefront on Amazon Premium Beauty in May. It also shifted its marketing from focusing on women and facial sunscreens to families and its PLAY body sunscreens, with a new campaign this summer emphasizing “A Family of Sunscreen, For Everyone In Yours.”

“Discovery happens everywhere now, across all different channels, and the consumer is driving this, and you really can’t think about your channels individually anymore,” Glowski said. “You have to really think about the full ecosystem and how do you reach the consumer.”

Something specialty

As brands sold in their stores spread their wings to new channels, specialty retailers must defend their turf.

With Target and others now following a similar playbook, Ulta’s high-low structure—selling both lower-price mass and higher-priced premium and prestige brands in one place—is “less of a story,” Voracek said. In March, just a week after Target announced its new concept, Ulta CEO Kecia Steelman was asked about competing with mass retailers pushing into prestige on its earning call. While Steelman highlighted the “low to lux” structure, she also noted Ulta’s launch on TikTok Shop and focus on newness and exclusivity. In June, the retailer launched a partnership with Bath & Body Works—which itself has recently expanded to Amazon—that includes exclusive distribution of certain classic scents.

Ulta’s chief retail officer, Amiee Bayer-Thomas, told Retail Brew at Ulta Beauty World in April that the retailer is also differentiating through services like its hair salon, ear piercing, brows, and makeup consultations, noting that shoppers who use those services tend to spend more and be more loyal. She also said its events—it’ll hold 140,000 this year—deepen shopper engagement.

Amid growing competition, Sephora also has been evolving its loyalty program this year, launching a Beauty Insider Celebration Month in August, and announced its debut on TikTok Shop this month. But Priya Venkatesh, global chief merchandising officer at Sephora, told Retail Brew earlier this year the retailer is “not here to overlap with mass—we want to bring the best of prestige.”

“When we say prestige, it’s about a store experience,” she said. “It is about our entire omniretail experience, and that is what we will continue to focus on, and not get distracted by what competition is doing.”

More than skin deep

Of course, adding a slate of higher-priced brands doesn’t automatically turn Walmart’s and Target’s beauty sections into mini Sephoras.

With premium beauty products seemingly on every store’s shelves, the “unlimited selection” could become overwhelming for consumers, so “the curation becomes more valuable almost for retailers than the selection,” Stokes said.

“For retailers, that can also be the challenge into the future of ‘How do I ensure that I’m being viewed as a place where the customer can get everything that they’re looking for, but with an edit and a selection that makes me the destination?’”

Specialty’s level of customer service, and the high-touch environment, isn’t easy to duplicate in a superstore, which Retail Brew previously reported greatly contributed to the downfall of the Ulta Beauty in Target shops. Such shortcomings are why Voracek believes Target’s move into prestige “is a stretch.”

In some ways, they’re making strides to close that gap. Target COO Lisa Roath noted on its Q2 earnings call the retailer is training “dedicated beauty advisors,” for its new beauty concept, while Walmart launched a pilot program for Beauty Experts earlier this year.

While neither store is currently offering in-store testers for its beauty products, Target said its Beauty Studios will feature “product testing opportunities for select items.” Glowski admitted the current lack of testers at Target was a “challenge” for Supergoop!, and its in-store visual merchandising is thus “working extra hard,” calling out its premium formulas, textures, ingredients, and other attributes. Kawas said online try-on and recommendations from its AI engine, Sparky, can replicate the tester experience.

And some Walmart and Target locations lock up select higher-priced beauty items, making them inaccessible and blocking the “buy-in experience” beauty thrives on, Stokes noted.

Blush with greatness

Now, one big unanswered question looms: How far can mass retailers take their new high-end concepts?

“We look at our business as ‘The customer will tell us,’” Walmart’s Kawas said. “We’re only going to stop when the customer says, ‘Oh yeah, I really don’t want that.’”