Nest Fragrances is moving into personal care.
In January, the brand, known for its candles and home fragrances, will debut a 32-piece lineup for the body, including lotions, mists, washes, lip balms and wipes. The collection will first soft-launch on NestFragrances.com on Jan. 2 and then roll out exclusively to 155 Ulta Beauty doors and Ulta.com during the week of Jan. 20. An additional 300 Ulta doors will be added in March.
“There has been such a demand from our customers to see more from our fragrances,” said Laura Slatkin, Nest Fragrances founder and executive chairman. “We feel like our customer has given us permission to cross categories, and when we look to the future, that is where our growth is.” Slatkin expects personal care to make up 20 percent of total company revenue in three years. Meanwhile, an industry source estimated that the Nest personal care collection could generate $5 million in retail, in 2019 alone.
The collection, which was largely derived from hero Nest scents, like bamboo, ginger and grapefruit, which were slightly adjusted in order to make home offerings more body-specific. (For instance, the bamboo products are now infused with jasmine, while the grapefruit lineup was injected with verbena.) The launch is largely a play to reach more millennials and Gen-Z customers, who are leading “active, on the go” lifestyles, said Slatkin. Nest currently has a large demographic reach: Eighty percent of its customer base are millennials and members of Gen X, and fifty percent of Nest’s email subscribers are under 36 years old. Price too was a key consideration for reaching younger customers. The new personal care collection ranges from $16 for a lip balm to $38 for a body mist. (Nest’s classic 8.1-ounce candle is $42.)
Additionally, that the personal care collection is cruelty-free, vegetarian, non-GMO and gluten-free is a way for Nest to tap the still growing $4.2 trillion global wellness market. “Consumers are so much more aware of what there are putting in or on their body, and our customer especially looks for brands that are taking the time to care about what she cares about,” said Monica Arnaudo, Ulta Beauty senior vice president of merchandising.
In many ways, Nest’s category expansion was inevitable after its $70 million majority investment stake from Eurazeo Brands in November 2017. Since Eurazeo’s influx of capital, Nest has seen a 30 percent increase in sales across all of its channels of distribution, said chief marketing officer Stephanie Davis Michelman. “We view this collection as the third leg of the stool — first home fragrance, then fine fragrance, then personal care — so we have a well-rounded lifestyle assortment to meet the needs of our customers,” said Jill Granoff, CEO of Eurazeo Brands.
Granoff said the launch of the new personal care collection replicates Nest’s previous playbook with fine fragrance, which hit the market in 2013, exclusively with Sephora. Five years since launch, that category now makes up 20 percent of Nest’s sales, and the brand continues to add new scents. (In February, Nest debuts its latest Poppy perfume with Sephora.) But the plans for personal care are indeed more ambitious. “We are entering a new channel distribution with Ulta, and they have an expertise in this area. Their customer is younger, and we are able to ramp up the business quickly with how many doors we are entering,” said Granoff. For comparison, Nest entered 75 Sephora doors with fine fragrance in 2013, compared to the current plan of 455 locations with Ulta.
The personal care segment, indeed, has been a focus for Ulta in the last year, said Arnaudo. “It is an area where we have seen a lot of traction, and we are adding new brands and products to the assortment,” she said. In spring 2017, Ulta launched elevated bath presentations (lit, freestanding, four-sided fixtures with graphics) in 300 locations with legacy beauty brands, like The Body Shop, and emerging brands, such as Rituals and Thymes. Currently, these displays are in 450 doors, and more locations will feature them in 2019 as Ulta continues to open more stores and renovate older ones. Nest personal care products will be prominent in these presentations.
Though Ulta is certainly an important channel for Nest, the brand will debut its first standalone store (a permanent variation of its holiday pop-up) in the Soho neighborhood of New York City in February. Aside from NestFragrances.com, which accounts for 10 percent of total sales, it which will be the first and only physical destination that will feature all of the brand’s collections: home, fine and personal care.
“Though we launch these categories in specialized distribution channels, the near and longterm goals are to bring these categories together under one roof, in our own retail environments, and then later in shop-in-shops,” said Slatkin. “We want to speak to our customer directly more, and this is how we can do that.”