Mecca sees growth in customers looking for Kardashian-style post-treatment skincare as viral hype fizzles
Just a few years ago it was tweens wanting skincare regimes, but now Jo Horgan’s retailer is witnessing growth from customers wanting post-treatment regimes for more invasive clinical services.
Jo Horgan isn’t sweating the profit drop at Mecca too much. And if she was, her beauty empire probably has a product to mask a glistening forehead, anyway.
Mecca Brands’ parent investment company RTCH, which has never been required to post formal accounts and only did so on Wednesday after discussions with ASIC and its auditor, revealed a 14 per cent drop in calendar year 2024 profit to $111m. Mecca’s profit from retail fell 19 per cent.
The group paid $110m out as a dividend to help cover the huge cost of building what might well be the world’s biggest beauty emporium opened just three weeks ago in Bourke Street, Melbourne.
Mecca has undertaken a massive bricks and mortar expansion right in the midst of the retail industry downfall.
It seems once again that Horgan has picked the latest trend just before it goes mainstream. This time it’s “performance” beauty care, with her Bourke Street store offering a dermal clinic and potions for anti-ageing, sleep and gut health.
More than 200,000 customers have come through the doors since it opened three weeks ago and Marita Burke, who leads Mecca’s own brand and innovations, says there is “strong growth” in the products customers might apply after having salmon sperm micro-needling, laser therapy, or cosmetic surgery.
Instagram is full of social media stars such as Kylie Jenner and Khloe Kardashian revealing their cosmetic procedures and adjunct skincare regimes.
The rush of stars “fessing up” to work they’ve had done “is the topic of conversation at every dinner party”, says Burke, who says Mecca is seeing “increasing demand for repair creams and barrier creams post treatments done elsewhere”.
“We aren’t going to make you look like Kim Kardashian but like you have had a good night’s sleep.”
The Kardashian effect is helpful. Mecca sells at-home devices like the Dr Dennis Gross LED mask which retails for $782 and “demand continues to grow”, says Burke.
This latest trend for performance skin care that targets wrinkles, redness, or even sleeplessness is a change from just a few years ago when “tween” skincare was all the rage.
Burke says customers are asking for products for hormone fluctuations associated with perimenopause, such as skin care with active ingredients and products to help hair growth.
“Two to three years ago there was a surge of brands that became viral such as Drunk Elephant and Sol de Janeiro. We aren’t seeing a slow down, but it’s levelled.”
Fortunately for Horgan and her husband Peter Wetenhall, who are the co-owners and co-CEOs of Mecca, the tweens and teens haven’t gone away, either.
Since 2023, Mecca’s customer base has been stable, with 3 per cent under 15 years of age, 25 per cent in the 15-24 age bracket, 32 per cent in the 25-34 bracket and the remaining 40 per cent aged 45 and over.
On Tuesday Mecca launched American fragrance brand Phlur, which Burke tells me my teenage daughter would know of. “It’s the immediacy. They want it now.”
FragranceTok, which is TikTok’s fragrance community, has converted teens into perfume snobs.
Horgan is clearly optimistic for the future of Mecca after giving Victoria its biggest retail opening in 100 years and rehabilitating a beleaguered David Jones store.
The beauty industry is one where customers still overwhelmingly visit stores, and a June report by McKinsey forecasts that by 2030 two-thirds of customers will still want to purchase that way. That’s down from three-quarters now, but with the losses forecast to come from department stores and drugstores rather than specialty shops, such as Mecca.
But the $1.3bn revenue beauty giant does face new competition from privately owned W Cosmetics, which has opened 38 stores in just 11 years and mostly focuses on Korean beauty products. Online retailer Adore Beauty has also announced a pivot to physical stores, and Myer is likely to bring a refreshed face to competition under new executive chair Olivia Wirth.
Profit might have slipped in 2024 but expectations are that Horgan’s focus will be back on growth.
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