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Australian beauty retailer Mecca is putting down roots abroad for the first time, starting with the launch of its Mecca Cosmetica sunscreen in the UK. It’s a small step, but one that tees up the company, which says it accounts for 25 per cent of the Australasian beauty retail market, for global entry.
Mecca stocks the likes of Nars, Charlotte Tilbury and Augustinus Bader alongside its four in-house brands. Mecca Cosmetica’s To Save Face SPF50+ is the number one best-seller across the business, says Marita Burke, who heads up Mecca-maginations, the company’s brand incubation and innovation hub launched in 2022. The SPF will be sold direct-to-consumer from a new dedicated website, and shipped from a distribution centre in the UK. To publicise the launch, the brand will lean on local influencers and press.
The goal is to test the waters globally before going all-in. Burke and her team are cognisant that global expansion — especially into countries where consumers already have a plethora of options — is a bold gambit. Sephora, while globally strong, withdrew from the British market twice before returning in 2022. “We really are going with a very slow, solid and steady approach,” says Burke. “We have six SPF products in our Mecca Cosmetica line-up, and we may look to roll those out into the UK as well.”
It’s the company’s first European dispatch. Headquartered in Melbourne and serving the Australasian markets, Mecca was founded in 1997 by Jo Horgan who opened the first store in the South Yarra suburb. Now, the company operates 109 stores throughout Australasia. Still entirely owned and funded by Horgan and her husband, the company does not release sales figures, though local estimates indicate the company reached sales of around AUD 572 million (around $393 million) in 2020.
Mecca has had a small e-commerce presence in China via online marketplace Tmall since 2020, which Burke describes as part of a “test and trial in terms of the market”. This UK move is the company’s first outside of APAC, and Burke says the UK was chosen for a number of reasons, including high consumer literacy around SPF as well as the relatively large size of the beauty market and appetite for prestige products. According to market research firm the NPD Group, the UK prestige beauty market was valued at £1.2 billion in the period from January to August 2022, an increase of 21 per cent from the same period in 2021.
Burke also notes the size of the Australian diaspora in the UK. “We had demand from [Australian customers abroad] wanting us to sell products where they are,” says Burke.
Suncare on the up
Sunscreen is a particularly important beauty category in Australia, where the government regulates sunscreens as a drug rather than a cosmetic, creating more stringent criteria for regulatory approval. “Sunscreen as a category is growing double-digit in the UK, and there’s a very sophisticated sense and sensibility towards skin care benefits and ingredients, as well as an appreciation for luxury formulas,” says Burke of the UK. According to market research firm Kantar suncare is the fastest-growing beauty category in terms of recruiting buyers, as it reached an estimated $2.7 billion in sales in 2022, up 7 per cent from 2021. Margaret Mitchell, chief commercial officer at British beauty retailer Space NK, previously told Vogue Business that the Australian sunscreen Ultraviolette Supreme Screen is a top 10 best-seller, even in January.
Sunscreen’s universal appeal was also a deciding factor, says Burke. “We felt that if we were going to launch in the UK, it may as well be with a product that is firstly such a core product to our business, but also something that anybody can benefit from, because everybody needs SPF.” Burke also noted that the company was seeing “quite a bit of demand” from British shoppers via their own website. “We felt that this was a good opportunity to simply test and see how significant the market could be there for us,” says Burke.
Global goals
A softly-softly approach to the UK’s booming yet fragmented market is likely advisable. “We would love to be the number one beauty destination, and the time may come for us to explore what the opportunity is for bricks-and-mortar in the UK,” says Burke. “But, in the interim, we need to test demand and appetite.” Burke says Mecca’s entry into the UK is unrelated to Sephora’s return, and that the company had been thinking about the UK for “some time”, but that the pandemic had adjusted its timeline.
Should Mecca make a bigger play for British retail market share, they’ll be up against Boots, the chemist stalwart that says it has a market share of over 40 per cent for skincare, makeup and premium beauty, and that 85 per cent of the population live within 10 minutes of a Boots store. Niche retailers such as Space NK are also popular, as well as department stores such as Harrods and Selfridges.
With appetite for premium products at all-time high, the runway for Mecca is expansive — as is the competition. “We need this launch to work before we can think about anything further. Hopefully, this can be the first bullet that will test for the future,” says Burke.
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