Key takeaways on why colour cosmetics brands are failing
- Pat McGrath Labs and Barry M highlight the mounting pressures facing colour cosmetics brands.
- ELC’s growth contrasts with declining makeup sales, signalling industry‑wide challenges.
- Consumer demand is shifting towards skin-first, hybrid and dewy formulations.
- Experts warn that brands built on short‑term tactics lack resilience in a tightening market.
- Long-term vision, differentiation and digital execution are now essential for survival.
The start of this year came with the sad news that innovative colour cosmetics brand Pat McGrath Labs has filed for Chapter 11 bankruptcy. Meanwhile, heritage UK-based colour cosmetics brand Barry M had to seek out a buyer or face going into administration due to heightened manufacturing costs.
While there are more opportunities than ever to create new cosmetics brands, there is also more competition and a volatile economy to compete with, along with a host of other changes in this category landscape.
It’s not all bleak news. On the whole, the overall beauty and personal care market has seen almost incessant growth since 2004 (excluding 2020) and, according to Statista, is forecast to generate revenue of nearly €117.78bn euros by the year 2030.
Yet even some of the world’s biggest beauty companies are experiencing lower makeup sales for their brands.
For example, Estée Lauder Companies’ recent Q2 financial results showed sales growth after the business underwent an emergency restructure last year, forced into action by numerous successive quarters of losses. But while the business has made a very impressive turnaround, one category that is still suffering is colour cosmetics. While fragrance, skincare and hair categories sales all showed growth, the latest sales results, which were for the ‘golden quarter’ festive period, showed that makeup sales were flat.
Circana’s new report on beauty sales figures in the US market for 2025 showed that sales for the makeup category grew by 4% last year, which means that some makeup brands are still seeing success.
The data and trends firm said that all prestige makeup segments posted growth, but flagged that there was “unit softness in face and eye makeup” that curbed the overall momentum.
Circana also highlighted the top gaining segments: makeup sets, lip liner, and other lip products such as oils and balms, and said that value, social media, and the “skinification” trend (hybrid formats that blend color and skincare benefits) anchored much of makeup’s growth.
When it came to mass market makeup sales, lip was also the fastest-growing makeup segment in the mass market, also driven by products such as lip liner and lip treatments.
Market pressures expose weaknesses in colour cosmetics brands
Mintel analyst Clotilde Drape said the current challenges for cosmetics brands reflect a broader shift in the beauty industry. She noted that the colour cosmetics category has been reshaped by celebrity and influencer-led brands such as Rihanna’s Fenty Beauty, Hailey Rhode Bieber’s Rhode and Selena Gomez’s Rare Beauty, which offer “emotional connections and community.”
But even on this point, it was notable that Fenty Beauty didn’t get a mention in LVMH’s recent financial results declaration for the full year 2025. Instead, LVMH Perfumes & Cosmetics focused on the success of Dior Beauty, which appeared to have driven most of the makeup sales for the group, so it wasn’t clear how well the brand really performed last year.
Drape also mentioned that makeup trends have shifted from “bold, pigmented looks” – which is what Barry M was offering – towards “skin-first finishes, hybrid products and sheer, dewy aesthetics.”
She highlighted that while bold makeup is making a comeback, consumers now seek brands that combine innovation with skin-enhancing formulations, with many of these products often coming out of K‑beauty.
Indeed, Amazon recently reported that the number of Korean cosmetics sellers earning more than $100,000 per year has more than doubled since 2022.
How consumer behaviour and makeup trends are shifting
Meanwhile, Marina Mansour, President of Beauty, Wellness & Luxury at beauty influencer agency Kyra, said the situations at Pat McGrath Labs and Barry M collectively highlight how unforgiving the modern beauty landscape has become across both luxury and mass.
“Cultural influence or long-standing brand recognition are no longer enough on their own,” said Mansour. “Today’s successful beauty brands are built on agility, repeat purchase and highly responsive digital ecosystems that bring to life a clear brand purpose.”
She added that where legacy luxury brands can struggle with scale and speed, mass brands face intense margin pressure and relentless competition.
“In both cases, the message is the same: brand infrastructure, digital execution and operating models must be aligned with the realities of how beauty is discovered, consumed and commercialised today. Cultural relevance still matters, but without a modern commercial engine behind it, it isn’t sufficient,” she said.
Strong brand foundations still matter in a saturated beauty landscape
It appears that there is still money to be made in the colour cosmetics category. So what else should makeup brands consider?
Nick Vaus, founder of beauty design agency Free the Birds, which has worked with many heritage cosmetics brands such as The Body Shop and Avon, notes that the current economic climate is exposing brands that may have had weak foundations.
Though he was not directly referring to the situations at Pat McGrath Labs or Barry M, Vaus believes that stabilised or plateauing growth exposes the fragility of brands built on short‑term tactics rather than long‑term equity.
“When growth slows, strategies are overly reliant on product launches, paid media bursts, or ad‑hoc social content which quickly loses effectiveness. These levers can accelerate momentum, but they cannot sustain it,” he said.
“In this environment, weak foundations become visible: shallow differentiation, inconsistent brand expression, and low consumer loyalty. Without a clear and defensible reason for existing, brands struggle to hold attention once novelty fades and media efficiency declines.”
Vaus also said that in contrast, brands anchored in a long‑term vision with a coherent core story, authentic purpose and clearly articulated ‘why’ are better equipped to navigate slow or stagnant markets. “Strong foundations create resilience when conditions tighten,” he said.
