Sephora News: CARGO Packs Their Bags

Canada-based CARGO Cosmetics is the latest brand to pull out of beauty giant Sephora. From what I’ve been told, CARGO will be pulling out of all freestanding Sephora locations, but will remain in the Sephoras that are inside JC Penney stores. It would appear CARGO will no longer be sold online at either, as it’s all marked 50% off on the Sephora site.

Historically in the blogosphere such moves have been speculated upon as a sign of a struggling brand. However, it’s really nothing to be afraid of. The truth is that in the past Sephora was pretty much the only game in town. With newer boutique stores like Ulta and Beauty 360, beauty brands have an array of choices for retailers. The problem is Sephora still acts like it owns the market. It doesn’t. Selling a brand in Sephora has been compared to working with the mob. They take a large chunk of sales, and influence a lot of the brand’s creative choices.

Lately it seems that many brands are breaking up with their controlling Sephora girlfriend and moving on to different pastures. Laura Geller pulled out of Sephora in 2009, and I’m also hearing reports of Stila disappearing from Sephora locations. We’ve seen a rise in popularity of the direct sales approach via networks like HSN, Shop NBC, and of course QVC. Both Stila and Laura Geller have recently made their television sales debut this way.

As the beauty market continues to be cutthroat as ever, Sephora needs to change her ways. Maybe get some therapy. Otherwise we can all expect other brands to follow in the footsteps of CARGO, Becca, Kevyn Aucoin, and Laura Geller.

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