Amazon (AMZN) Eyes Cosmetic Business With Lady Gaga Products

Amazon.com, Inc. (NASDAQ:AMZN) has approached customers with more good news: Pop star Lady Gaga’s highly anticipated beauty brand, Haus Laboratories, will be available exclusively on Amazon.

Reportedly, the new cosmetics line will be available within this September. The beauty collection will include makeup kits that combine lip gloss, lip liner and all-over color.

Notably, the new beauty products will be sold in many countries including the United States, Germany and Japan, to name a few.

The latest move will aid the company to penetrate into the growing beauty industry, which is valued at around $56 billion according to Forbes.

It will further strengthen Amazon’s retail business with new beauty products, which are in turn likely to expand the customer base. Consequently, this will drive the company’s top line.

Beauty Market Holds Promise

Lately, Amazon has been making huge efforts to expand share in the beauty retail market.

Last month, the company unveiled Amazon Professional Beauty Store in a bid to disrupt the cosmetics and beauty products market on the back of e-commerce strength. The new store is part of Amazon Business, which will offer beauty supplies and professional salon products to cater to licensed and professional stylists, barbers, as well as aestheticians.

In March, the company unveiled private-label skincare line called Belei. The company’s product line has 12 different items that include moisturizers, eye cream and spot treatments, among others.

This initiative is likely to help it gain popularity among beauty professionals, thereby boding well for business growth.

Per a report from Statista, the U.S. beauty and personal care marketis expected to generate $82.9 billion revenues in 2019.

Further, the cosmetics segment of the market is anticipated to generate revenues of more than $17 billion this year.

We believe the expansion of beauty-related product offerings on Amazon’s online platform and their easy availability are expected to position the company well to capitalize on the U.S. beauty and personal care market.

Bottom Line

The beauty retail market is one of the new territories that the e-commerce giant is eyeing. In fact, it is set to disrupt the market on the back ofrobust distribution strength and the ability to deliver convenient shopping experience.

The company’s strengthening delivery system and shopper-friendly deals are likely to help beauticians save time and money.

Amazon is anticipated to pose a significant threat to existing beauty retailers like Sally Beauty Holdings SBH, Ulta Beauty ULTA and Sephora, to name a few.

Further, the company upped the ante against Walmart (NYSE:WMT) WMT, which also sells varied beauty products.

We believe all these steps are likely to further strengthen Amazon’s position in the U.S. retail space.

Zacks Rank & Key Picks

Amazon currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the broader technology sector include Match Group, Inc. (NASDAQ:MTCH) , LivePerson, Inc. (NASDAQ:LPSN) and Dropbox, Inc. (NASDAQ:DBX) . While Match Group sports a Zacks Rank #1 (Strong Buy), both LivePerson and Dropbox carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Match Group, LivePersonand Dropbox is currently projected at 15.2%, 25% and 14.2%, respectively.

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