Business Categories Reports Podcasts Events Awards Webinars
Contact My Account About

GWPs Are Alive and Well and Bigger than Ever

December 6, 2022
December 6, 2022
Cult Beauty

Gifts with purchase, the scourge of the beauty industry, are alive and well this holiday season. In fact, GWPs are over the top, demonstrating a sense of desperation among some retailers who are worried that inflation and recession fears will put a damper on consumer spending.

“FREE gifts with purchase – up to $172 value,” screamed an email from Nordstrom. “Score can’t-miss gifts from La Mer, Clé de Peau Beauté and more top brands. Hurry, quantities are limited!” There are 80-plus different gifts with purchase, the ad goes on to say. There’s even photos of the featured GWP, Aerin Beauty’s deluxe samples of Aerin Body Rose Hand & Body Cream and Rose Lip Conditioner, with any Aerin purchase online.

There are other gifts highlighted. For example, Cartier’s deluxe samples of Pasha de Cartier Noir Eau de Toilette and Pasha Edition Noir Eau de Parfum, which come together in a travel pouch, with a $245 Cartier men’s fragrance purchase. There’s also a $60 Bonus Note offer for Estée Lauder products and a GWP of a full-size Re-Nutriv Ultimate Diamond Transformative Energy Moisturizer Cream Rich with a $150 Estée Lauder purchase. The list goes on and on.

Bloomingdale’s is offering GWPs on single beauty items, such as Valentino’s Eye2Cheek Blush and Eyeshadow, $58, and Gucci Beauty’s Vernis à Ongles nail polish, $33. What the actual GWPs entail is not spelled out by Bloomingdale’s, but there are dozens of eligible products, including Dior’s Diorshow Pump ’N’ Volume mascara, $29.50.

La Mer, the treatment brand, sells for $100 to $2,545 at Bloomingdale’s. And yet, it comes with a GWP, a deluxe sample of the Moisturizing Soft Cream in a .24-ounce size. If you’re wondering why a consumer who can afford to pay $2,545 for a face cream would hold out for a GWP, you simply don’t know human nature.

In fragrances, several brands appear to opt out of the requisite GWP at Nordstrom. For example, Chanel, whose ready-to-wear handbags and accessories rarely go on sale, offers no GWPs at Nordstrom for Chanel Chance Eau Tendre Eau de Toilette, $95 to $150. Ditto Chanel Gabrielle Chanel Essence Eau de Parfum, $116 to $183. The same goes for Chanel Essence Eau de Parfum spray, Chanel Chance Eau de Parfum spray, Chanel Chance Eau Tendre Eau de Parfum spray, and Chanel Coco Mademoiselle Eau de Toilette spray.

The beauty industry has been trying for decades to extricate itself from the gift-with-purchase go-rama, which has trained consumers to wait for the GWPs before buying a full-size product and paying full price. Customers have been conditioned to expect the little somethings-for-nothing, which the beauty industry has bestowed on them for more than three decades.

Like any perk that’s removed after some time, consumers rebelled against efforts by beauty companies to get rid of GWPs.

Marigay McKee, General Partner and co-founder of Fernbrook Capital Management LLC, and former president of Saks Fifth Avenue, was previously a beauty executive at Estée Lauder Europe, who rose to the post of Chief Merchandise Officer at Harrods in her native England, after holding positions of Beauty Director and Fashion Director.

She said that most of the retailers she’s worked with were interested in “creating a positioning  platform for growth and building a lifestyle stable of luxury fragrances” so they don’t discount them.

“Everybody is interested in building more of a luxury strategy for fragrance that has longevity, creativity and desirability in the asset,” said McKee. “Brands are very interested in building families of luxury fragrances, like Jo Malone, Tom Ford, Dior, Chanel and others.”

“As we’re in uncertain times, different companies have formulated different strategies,” McKee continued. “Chanel now gives you these chic little boxes with mini scents or skin care, which still evolve the luxury relationship with the customer.”

“The luxe brands will give you mini samples as a value-add without the need to reduce the ticket price, which is more of a mass strategy,” McKee added. “At the end of the day, you’re not generally discounting the luxury brands, whatever the climate. This increases brand loyalty, trust and positioning at the top.”

My Exclusive Loyalty Program sells actual beauty gifts with purchase, no full-price purchase required. There’s no clue as to how the company gets them. The Dior Addict Natural Glow makeup set, consisting of lip balm, plumping lip serum, and gloss, is $58, or four interest-free  payments of $14.50 each with Klarna. “Been wanting to try out this popular lip balm and this set is the best bang for the buck,” said Agnes from New York on the website.

“At the end of the day, you’re not generally discounting the luxury brands, whatever the climate. This increases brand loyalty, trust and positioning at the top.”
By Marigay McKee, General Partner + co-founder, Fernbrook Capital Management LLC

The beauty industry apparently has Estée Lauder to thank for GWPs. In 1959, she had no advertising budget and a house full of cosmetics that she needed to move. She offered a gift with every purchase made at a department store, and the rest is history.

Not surprisingly, there are blogs devoted to beauty gifts with purchase, such as GWP Addict, which offers intel on brands’ GWP activities and deals.

“Hi, my name is Lisa,” says the author of the blog in the About Me section. “I’m completely addicted to tiny little beauty bottles. Skin care, hair care, makeup, I love them all, but what I love most is buying something and getting those free little beauty gifts. I started this blog when my daughter was in Kindergarten and she is now a sophomore in college, so clearly, my addiction is going strong.”

One GWP that’s highlighted by GWP Addict is Credo Beauty Clean Beauty Gift with Purchase, a huge haul consisting of a free 21-piece clean beauty bundle valued at $290. With any $250 purchase from RéVive, receive five skincare minis, valued at $220. Ultra Beauty’s Black Friday deals are also enumerated, but there are too many to list.

Lancôme’s Holiday Beauty Box at Dillard’s is actually a PWP, or purchase with purchase—on steroids. The box costs $75 with any $42 Lancôme purchase. “Eight full-size favorites, for less than the price of one serum, a $542 value,” said the online ad. The collection comes in a “luxurious gold vanity case, created from 100% recycled materials and imprinted with the original Lancôme Orlinski Rose.” There’s even a YouTube tutorial on how to use the products.

An industry expert, who asked not to be named, said, “Customers know that they can wait for GWPs. Chanel, Hermes and Dior train their customer to pay full price. On the other hand, the GWP adds ‘value-added’ and gives value to loyal customers.”

“A trend started—elevating brands with a fusion of heritage and modernity,” the expert added. “There’s also the trend for clean fragrances and scenting rooms with candles. Companies like Nest and other candle houses have been smart in the way they’re marketing their products as luxury items. Jo Malone was the first and now we have more choices.” But are they offering GWPs?

We’ll have to wait until retailers announce their fourth-quarter earnings to find out whether retailers gave away the store with GWPs, or whether they contributed to profitability.

×

2 Article(s) Remaining

Subscribe today for full access