Yahoo Finance Farfetch in Talks With Violet Grey: Sources
Farfetch is looking to Violet Grey as a potential bridge to the beauty industry.
The luxury e-commerce platform has been in talks with Violet Grey about a potential acquisition or partnership that would help as it establishes a beauty business, WWD has learned. The exact state of the discussions, which are said to have been going on for several months, could not be learned.
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A Farfetch spokesperson said, “As a matter of policy, Farfetch does not comment on market rumors or speculation.” Cassandra Grey, founder of Violet Grey, said, “While I’m a huge admirer of José [Neves, Farfetch’s founder and chief executive officer], and the incredible platform he has built, there is nothing to announce or comment on.”
The high-end Violet Grey, which dubs itself “The industry’s beauty edit,” offers a selection of beauty products and has been seen as a kind of beauty ambassador to e-commerce before, having been said to have held talks with Amazon several years ago. In 2018, it sold a stake to Shiseido as that company sought to build its own e-commerce chops.
A deal with Farfetch could help put Violet Grey on the frontier of the fast-evolving beauty and e-commerce landscape.
Farfetch has taken the lead in luxury fashion e-commerce, pulling ahead of competitors Net-a-porter, Matchesfashion and Mytheresa recently. While all those companies have been gaining with the sector generally, the Neves-led Farfetch has successfully crafted itself as a platform and tech company, bringing fashion boutiques and consumers together and supplying technology to reduce friction in the process.
And Neves has emerged as a canny dealmaker, inking a mega partnership with Alibaba and Compagnie Financière Richemont that brought Farfetch to Chinese e-commerce leader Tmall. Farfetch has also bolted some of its own businesses onto its platform, including London retailer Browns and Off-White licensee New Guards Group.
All together the ecosystem approach has proven to be self-reinforcing and has helped the company’s market capitalization soar to nearly $17 billion.
“The vision was always to be an operating system for the industry, a technology partner and we really think we will be the digital enabler that will help this industry thrive,” Neves told WWD earlier this year.
Now, Farfetch is looking at entering beauty next year.
Stephanie Phair, chief customer officer, sketched out the company’s plans on a conference call with analysts in February, laying claim to a category that she said represents roughly one-quarter of the $300 billion luxury industry.
“We intend to enter beauty in an only-on-Farfetch way,” Phair said. “What this means is showing the customer an immersive crossover between fashion and beauty to appeal to our existing audience of fashion lovers.”
The company also wants to flex its innovation muscles with features such as virtual make-up try-ons while operating largely through a third-party concession model. That would help brands protect their profit margins and mirror the approach used currently in department stores.
“We really want to launch a full proposition, end-to-end and really think about it in a unique way,” Phair said. “This is not about just launching an adjacent category, and we believe that we can truly lead in this space.”
Farfetch is not just going into a new category, but looking to keep up with shoppers and serve their needs.
“Our customers and Gen Z tell us that they want to shop full look,” Phair said. “So there’s investment in content and in our customer journey and proposition around how we want to present beauty… It’s a multiyear road map. Beauty is incredibly specific. It requires investment into our architecture, our platform, developing features and specific content, but we’re excited about this.”
Phair has also said Farfetch is getting interest from fashion brands that have their apparel on the platform, but not their beauty offering, as well as from newer beauty brands.
But beauty is new territory for Farfetch and a new kind of discussion. Having Violet Grey on board in some form could help move things along in the platform’s headlong rush for luxury supremacy — if it can get there.
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