Big-box retailers are aggressively upgrading their beauty offerings to attract returning in-store shoppers and younger, digital-first consumers. The “shop-in-shop” partnerships that are bringing Ulta $ULTA into Target and Sephora into Kohl’s locations can also have a positive impact on ecommerce sales, as consumers may go online to replenish items they bought in-store.

Department stores, once a principal sales channel for high-end beauty products, have had their market share eroded by new players. It’s a trend that began well before the pandemic, and it’s shifted into higher gear since.

These retailers are repositioning themselves accordingly. $KSS Kohl’s has made the most radical change by replacing store beauty departments with Sephora shop-in-shops, and it’s on track to have at least 850 in place by 2023, covering roughly three-quarters of its store count.

Others are exploring new paths for growth on the ecommerce front. In 2021, both $M Macy’s and Saks (the newly spun-off ecommerce unit of Saks Fifth Avenue) announced plans to launch online marketplaces to generate revenues while expanding the depth of their product offerings.

Retail media networks are another route for department store operators to increase revenues via beauty brands. Though this is an increasingly crowded and competitive field, department stores can boast an audience of potential customers that is more appealing to beauty brands.