Cult Beauty was co-founded in London in 2007 by Jessica DeLuca and Alexia Inge as an online specialist retailer of emerging, prestige beauty brands across skincare, haircare and cosmetics.
Independent prestige beauty brands
Today, Cult Beauty stocks about 300 prestige beauty brands - including Charlotte Tilbury, Drunk Elephant and Huda Beauty - many of them (over 70%) being independent. According to The Hut Group, around two-thirds of these brands are not currently listed on the group’s other beauty sites. The UK e-commerce giant sees this as an important opportunity to complete its offering.
“Cult Beauty is frequently the partner of choice for emerging indie brands due to its personalised, content-led approach and enthusiastic consumer base who are continually seeking new, innovative solutions to complement their beauty routines,” THG chief executive Matthew Moulding said. “Cult Beauty’s first-to-market reputation makes the brand an exciting fit for our THG Beauty division," he added.
The Hut Group plans to keep Cult Beauty’s separate branding and identity intact. “Due to its distinguished brand portfolio, Cult Beauty will retain a very clear identity within THG Beauty,” highlighted the company in a statement.
According to The Hut Group, this acquisition will also be an opportunity to develop Cult Beauty’s international reach. Indeed, currently less than 50% of Cult Beauty’s sales are made outside the UK.
"We anticipate fully migrating Cult Beauty onto the THG Ingenuity platform by the end of the year (within the first six months of acquisition), giving the brand access to the global digital features to underpin significant future growth," said Matthew Moulding.
The acquisition will help The Hut Group to better address consumers’ preferences globally. "THG Beauty will principally service customers within North America via our Dermstore and Lookfantastic brands, while in the UK, Europe, Asia and the Rest of the World the key brands will be Lookfantastic and Cult Beauty," detailed Matthew Moulding.
The Hut Group expects Cult Beauty to contribute sales of about £60m and adjusted EBITDA of about £3m for the remainder of FY 2021, and contribute sales of approximately £140m and adjusted EBITDA of £10m in FY 2022.
Most recently, Sephora announced the acquisition of Feelunique, another major online retailer of prestige beauty products in the UK.