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Three months after Farfetch shut down its beauty business, the company is exploring options for Violet Grey, the LA-based beauty retailer it acquired last year. It’s understood this could lead to a sale of the business.
Violet Grey stocks a mix of buzzy independent brands including Isamaya Ffrench, Simi Haze and Augustinus Bader, as well as luxury heavyweights Chanel, Giorgio Armani and Tom Ford. When the acquisition was announced in January 2022, Stephanie Phair, group president at Farfetch, said it was an “important step ahead of the launch of beauty on Farfetch later this year and will form part of our overall beauty strategy”.
The multi-brand online retailer bought Violet Grey in January 2022 and invested in next-gen brands, but winning in the crowded space has proven difficult for e-commerce players.
However, this August, it emerged that Farfetch was winding down its beauty business, underscoring the difficulties online retailers face when trying to make beauty work — and leaving a question mark over what it would do with Violet Grey. In March, Farfetch said Violet Grey’s assets and revenue represented less than 1 per cent of its consolidated revenue for the fiscal year ending 31 December 2022, according to the company’s financial statements. In May, Farfetch said first-quarter revenues rose 8 per cent to $556.4 million and the company returned to growth. (Violet Grey maintains a separate e-commerce site as well as its Melrose Place store.)
The beauty market was a strategic target for Farfetch and is a lucrative category, a sector expected to hit $580 billion by 2027, growing by a projected 6 per cent a year, according to a 2023 McKinsey report. Farfetch has tried to break into the market before through a partnership with UK-based beauty retailer Space NK, which was quietly shuttered in 2016.
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