Urban Decay’s Naked Palette is dead.
But it is not entirely certain how much of this is marketing stunt versus a new chapter for the brand, or both — especially considering the significance of the palette to the brand’s bottom line and its brand awareness.
In a splashy marketing campaign released today, Urban Decay announced it is discontinuing its Naked Palette across its e-commerce site, as well as at retail partners Ulta, Sephora, and Macy’s, and internationally. Since the launch of the Naked Palette in 2010, it has made over $1 billion for the brand — every six seconds a palette is sold, and over 30 million Naked Palettes have been sold in total, according to Urban Decay. It has become significant to the brand’s image — influencing the creation of the Naked2, Naked3, Naked Heat and other palettes, for example. In 2012, two years after the original launched, NPD Group identified Naked 2 and Naked as the top two selling makeup sets. And, from the time the brand was acquired by L’Oréal Group in 2012 to 2014, Urban Decay doubled its sales and was the highest earner in its division, which included Lancôme, Kiehl’s and Ralph Lauren.
So why discontinue a hero product?
“The Naked Palette has been a total game changer and category creator, leading the palette category for the last eight years. It’s become a staple in everyone’s makeup collection, and we’re so proud of that,” said a brand spokeswoman. “But they say if you’re going to go out, you should go out on top, so it’s time to do that. And we need to make room for what’s next,”
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Overall, hero products play an important role in business, as they serve to position a brand’s value and message while also raising awareness and selling product, according to Brady Donnelly, founder and managing director of creative agency Hungry. They are also lucrative. According to software company Launchmetrics, Urban Decay saw 2,341 mentions across online, print and social media for Naked Palette mentions in April, which generated with a total $474,390 in Media Impact Value (MIV), which defines the monetary performance across media channels.
Additionally, the two Instagram posts Urban Decay released today announcing the discontinuation had a total MIV of $102,000.
“For Urban Decay it may be an issue that they are so synonymous with the product, that they may need to grow beyond that to grow the brand image into something else for the brand’s future,” he said, while adding that while it is not clear if the brand’s sales of Naked Palettes have begun to decline, but emerging brands such as Kylie Cosmetics are able to reach comparable sales faster than ever.
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At the same time, today’s younger consumer expects a greater sense of discovery and newness with beauty brands, and hero products can be a double-edged sword, Donnelly said.
According to Urban Decay’s parent company L’Oréal Group, the brand experienced slowed-down growth during its first-quarter sales in North America. This may be why discontinuing the product is a good marketing play, as it drives sales from products that have decreased in their power to generate revenue, according to Melissa Munnerlyn, co-founder and COO of software company Cherry Pick AI. Once its No.1 product, last month the Naked Palette only generated 0.05 percent of product intent (POPI), or market share, expressed by consumers across social media. Last month the OG Naked Palette was the 26th most popular Urban Decay product and the 478th in the eye palette category. However, once Urban Decay announced its discontinuation, the Naked Palette jumped up to the 6th most-popular Urban Decay product, ranked by POPI, and 23rd most popular across all eye palettes.
But there’s always a chance of a resurrection, even if ever so briefly.
“In today’s digital-minded world, brands are using tools to track the conversations about these products (even after retired), and if there are enough people searching for them (or even buying them through eBay or other secondhand resellers), there is always a chance they’ll deem them worthy of a comeback,” Alison Levy, CMO of Launchmetrics said.
