The battle for the beauty consumer continues. Following Target x Ulta and Kohl’s x Sephora, now Walmart, the world’s largest retailer, is joining the prestige beauty partnership game, hooking up with UK beauty retailer SpaceNK.
"As a top beauty destination, Walmart is continuously looking for new ways to wow and surprise customers by expanding our selection and offering convenient access to the best product assortment across beauty," Laurie Tessier, Merchandising Director of Prestige Beauty at Walmart, said in a statement.
The move has Walmart doubling down on its commitment to capturing today’s beauty consumer with the collaboration dubbed BeautySpaceNK. Fifteen brands will be participating at launch, which will consist of a curation of 600 products across categories from the SpaceNK merchandising assortment. The partnership will launch on Walmart's website beginning March 15, with the in-store concept hitting 250 stores in early summer with most locations consisting of a branded endcap and an adjacent aisle. The collaboration will also include an exclusive brand Summer Camp, a mineral-based SPF developed by the founders of Soleil Toujours, that will launch at Walmart this summer.
“We’re able to provide our customers with both mass and prestige beauty products in one simple and really convenient shopping destination,” Tessier told WWD. “SpaceNK does an incredible job at curation, which is really at the forefront of our strategy: offering consumers that curated, elevated experience with products overall.”
Last year, Target opened Ulta shop-in-shops that operate as an extension of the Ulta Beauty experience, mirroring its existing stores and designed to discover established and emerging prestige brands. With approximately 1,000 square feet of retail space, Ulta Beauty at Target is adjacent to the existing beauty section. There were 100 doors opened last year, with an additional 250 slated for 2022. In February, the retailer introduced 40 new brands to its overall beauty mix, with half being Black owned or founded.
Around the same time, Kohl's announced a partnership with Sephora that saw Kohl’s exit its beauty category and service that need with Sephora shop-in-shop concepts to be rolled out within the next three years. By comparison, the Sephora concept is a fully immersive, premium beauty destination prominently located at the front of the store. The initial rollout saw 200 doors open in the fall of 2021 with another 400 stores slated for this year, putting the partnership on track to meet its 850-store goal by 2023. Kohl's recently reported that locations with Sephora shops saw more traffic and a mid-single-digit sales lift compared to the rest of the chain. The retailer also announced that it aims to grow the Sephora business to more than $2 billion in annual sales.
SpaceNK was founded by Nikki Kinnaird in 1991 and opened its first store in Covent Garden, in 1993, selling products from indie beauty brands like Diptyque, Kiehl’s, and NARS that have grown into established category leaders. In 2020, SpaceNK announced it was closing its eight freestanding stores in the US, teaming up with Nordstrom and Bloomingdale’s in a wholesale relationship to sell its niche beauty assortment. Currently there are around 70 SpaceNK stores in the UK and Ireland and 29 locations in the US.
“We’ve seen a shift in the market in the US, blurring the lines between specialty and general retail, along with huge growth we’re seeing in our wholesale business with our existing partners,” Andy Lightfoot, Space NK’s Chief Executive Officer, said to WWD. “We supply marketing, we supply expertise, we supply curation. In each of those spaces, we look to put together a collection of brands and a support level that provides growth.”
“It’s really about giving the brands the opportunity to express themselves,” Lightfoot said. “It’s about having a broad mix of brands of different ideologies, creative stories, price points and offering all of those to the customers. We were fortunate to have a wealth of data from walmart.com, so that gave us a good guide on the sorts of brands customers were looking for and demanding.”
The partnership with Walmart will significantly increase SpaceNK’s footprint in the US market. In its first iteration, the partnership is testing as many segments and brand types from prestige beauty as space allows, with curation at the forefront of the strategy. Unlike the Ulta and Sephora partnerships where trained beauty advisors are in Target and Kohl’s to extend the premium beauty experience, BeautySpaceNK will be unstaffed, leveraging integrated technology like QR codes to provide education.
SpaceNK has created a new division to support the Walmart partnership long term although there are no plans in place for how the relationship might evolve. While SpaceNK doesn’t have the brand recognition of Sephora or Ulta in the US market, Walmart certainly has the resources to support the partnership and continues to reinforce its commitment to the category. At the end of February, the retailer announced the launch of a beauty accelerator program, called Walmart Start, as a way to discover up-and coming beauty brands.
The BeautySpaceNK launch brands include Slip Beauty, By Terry, Philip B., Lancer, Patchology, PSA, Foreo Ameliorate, Goldfaden MD, Babe Original, Eyeko, Grow Gorgeous Mio, Mama Mio, Mario Badescu and Summer Camp.
