This week, a look at Morphe’s comeback plan, which deprioritizes influencer partnerships and limited-edition product drops. Scroll down to use Glossy+ Comments, giving the Glossy+ community the opportunity to join discussions around industry topics.
Morphe is back and determined to move forward without the trappings that led to parent company Forma Brands’ bankruptcy earlier this year.
On June 4, Morphe will launch a Continuous Prep & Set Mist+ with Ulta Beauty. It’s the first product launch since the company exited bankruptcy in April, just four months after filing Chapter 11. Under the new ownership and with an undisclosed capital infusion, Forma Brands is redirecting its business to focus on products versus influencers, as well as wholesale and DTC e-commerce after flagship brand Morphe shuttered all its stores in early January.
“The core of our strategy is transforming to be a product-first beauty brand,” said Simon Cowell, president of Forma Brands.
Forma Brand’s new owners purchased the company for $690 million. They include &Vest, a consumer brand investment and operational platform with a history in the beauty industry, alongside Jefferies Finance LLC funds, managed by Cerberus Capital Management, L.P., and FB Intermediate Holdings, LLC. At its height, Forma Brands had been evaluated at $2 billion in 2019 when it sold a majority stake to private equity firm General Atlantic. Cliff Moskowitz, an operating partner at &Vest, has joined Forma Brands as chief executive officer. Moskowitz replaced Eric Hohl, who joined in March 2022 and formerly served as Too Faced CEO.
The current brands within the Forma Brands portfolio include Morphe, Morphe 2, Lipstick Queen, Jaclyn Cosmetics and Born Dreamer, the latter of which is a fragrance partnership with TikTok influencer Charli D’Amelio. Meanwhile, in February, singer Ariana Grande bought the assets of her brand R.e.m. Beauty from Forma Brands for $15 million. It had operated under a license.
At the time of its January filing, the narrative was that mega-influencer partnerships with people like James Charles and Jeffree Star had negatively impacted the brand and its sales, among other business missteps. Cowell said that the company’s drop model and capsule makeup collections, which were so popular circa 2019, shifted the focus of the brand away from its accessibility and quality narratives and toward being a covetable limited-edition brand. Selling out of products is nice, except that it means no one can buy.
“[The problem] was not about influencers [themselves], but when we created collaboration products with big influencers, our key pillar of accessible beauty with prestige quality was placed in the background,” said Cowell. “What got lost was the real value proposition of the brand.”
Doug Jacob, co-founder of &Vest, also pointed out that the macro-business environment in which Morphe and, later, Forma Brands grew was entirely different than it is now.
“The word ‘bankruptcy’ is scary to the outside, but it’s really a clean reset,” he said. “The core brand wasn’t hurting. It was because the strategy was to launch multiple brands, open large format stores and grow quickly.”
That’s where Morphe’s new Continuous Prep & Set Mist+ comes into play as the figurehead in Forma Brands’ righting of the ship. The product features skin-care ingredients like ceramides magnesium, and ginseng to prep the skin before makeup application. It is inspired by the existing Continuous Setting Mist, which is Morphe’s No. 1 best-selling product, with one bottle selling every 12 seconds. Prep & Set is an opportunity to reformat the brand’s marketing model to take a 360-degree approach, rather than rely mostly on earned media as it had in the past. Morphe is engaging with traditional media through public relations and full-funnel paid media ad campaigns, and will invest 18-20% of revenue back into paid media. Influencers still have a role to play with Morphe, but they are positioned within marketing while the brand and products maintain the spotlight. Morphe will also host influencer events in L.A. and Miami.
“We leverage influencers differently now. They’re building engagement for us and driving awareness on new products, versus it being about the influencer,” said Cowell.
The new Prep & Set Mist+ doesn’t come out of nowhere. Cowell said that the past 18 months have been about diversifying the portfolio and business. Morphe notably began as a makeup brush brand before it expanded to makeup, established big influencer partnerships and eventually formed Forma Brands. Cowell said those diversification efforts will include the launch of tinted moisturizers and liquid lipstick, a departure from the eye makeup and full-face makeup of Morphe’s past. Morphe 2, launched in July 2020, is another example of trying to adapt to other consumer needs — in that case, younger customers who want lighter and more natural makeup applications.
Moving forward, Morphe will focus on creating and selling complexion products, eye makeup and makeup brushes. The brand will also focus on growing in Europe, the Middle East and Africa regions and hired a new general manager to lead those markets.
“We’re excited to get past the bankruptcy [news] and re-emerge as a really powerful brand that we know we already are,” said Jacob.
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