USA: a mixed picture for the $153 billion beauty sector!

According to Karen Young*, CEO of The Young Group, “the US beauty market continues to attract startups with large but modest orders. On the other hand, it is impossible to predict which of the major brands that are undoubtedly struggling will survive.” Her observation: “Today, companies must rethink their strategies, improve their management, and motivate their teams. The smartest ones will survive.”

Before founding The Young Group in 1999, you were Vice President of Marketing and Product Development at Lancôme, the prestige division of L’Oréal. Before joining Lancôme, you spent 17 years at Estée Lauder, where you held various management positions, including executive director of color cosmetics. Since founding The Young Group, you have worked in all areas of the cosmetics industry. How do you see the “supplier” market evolving in this sector? What constraints are they increasingly facing and what, in your opinion, are the solutions that will enable them to move forward?

Karen Young: Even though the US market (worth $136 billion in 2024 and $153 billion this year according to Euromonitor) is currently doing rather well (growth is generally between 4% and 10% depending on the sector), it is clear that today’s suppliers must be faster and more flexible than ever before, with large quantities of packaging in stock that can be adapted to demand. The challenges facing these suppliers are considerable. This is particularly true because they do not know from one day to the next what will happen in terms of customs duties.
It should be noted that consumers on both sides of the Atlantic are facing increasing and equivalent economic pressures. Pressure has increased on small brands, which are subject to constant demands for novelty and innovation, not to mention requirements for sustainability and digital transformation. The challenges are numerous.

What advice would you give these suppliers to help them adapt as best they can?

Karen Young: I advise them to reduce their range and focus on “key” products. Create collections that work together, tell a story, and can be adapted to different customers. Given the circumstances, it’s impossible to do everything. At the same time, you have to be creative and innovative. It’s a difficult combination.
The second recommendation is to collaborate with formulators to present comprehensive and innovative solutions. Develop a story that fits with current beauty trends. Give customers a vision, don’t just sell them a tube or a jar.

Is environmental preservation still a key issue in the United States?

Karen Young: Admittedly, it’s a little less so at the moment due to the economic climate and those infamous tariffs. But brands and suppliers don’t really have a choice.
They are all forced to align themselves with what is happening in the world in this area. And this is despite the fact that tariffs are weighing on all categories of consumer goods. At the moment, the beauty market continues to attract many startups whose order levels are steadily climbing, even if volumes remain modest. However, it is impossible to predict what will become of certain big brands, such as Estée Lauder.

When people come to you for advice on launching a beauty product, we imagine luxurious formulas, eye-catching packaging, and a “fanfare” release on the shelves of the market’s leading retailers, all supported by influencers and leading media outlets. It’s certainly not that simple!

Karen Young: Let’s be honest, it’s a difficult journey (albeit an exciting one!), but we’re here to guide the company as best we can. We are based in New York and Paris, which allows us to analyze trends and establish contacts in the sector around the world. We have a very diverse clientele in the beauty, health, and wellness sectors. We manage brand creation from research to product development, distribution, and sales.

*Karen Young is also an active member of the board of directors of Fashion Group International.
She has developed concepts and products for Dove, Bath and Body Works, Neutrogena, Vichy, and Canyon Ranch. She has worked with many established brands in the beauty industry, including Christian Dior Beauté, Shiseido, Chanel, Parfums Givenchy, Avon, and 3M Products.
Karen is an adjunct professor at the Fashion Institute of Technology, where she teaches product development in a graduate-level course.
karen@ygroup.com