An up-and-coming cosmetics chain owned by Macy's is thriving by selling to the 'suburban power woman'

Bluemercury

American retail may be struggling, but there's one category that appears to be thriving: cosmetics.

Bluemercury is proof. The luxury cosmetic store and spa — which, according to co-founder and Chief Operating Officer Barry J. Beck caters to the "suburban power woman or the urban superwoman" — was swept up by Macy's in 2015, and it has more than 100 stores. It plans to open up at least 40 stores come 2017, including stores within Macy's. (Meanwhile, Macy's announced that it will be closing roughly 100 stores.)

Here's what Bluemercury has going for it.

1. People will spend on makeup; it's a "petite luxury."

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Beck, who founded the store 17 years ago with his wife Marla, called it the "lipstick index." He said "it's hard to buy a new Cadillac, but to get a quick product or a quick fix like luxury lipstick or eye cream, you can really feel better about yourself, and you don’t have to break the bank." He called it a "petite luxury."

Also — people want to look younger, which is certainly a boon for the cosmetics industry — especially the upscale cosmetics industry, which offers lots of pricey skincare products.

"I think in this fast paced environment — young, youthful, fast — it’s so important," he said, noting that now, "men are looking for ways to look younger; it's the first time we're seeing more men coming into our store."

2. It works at the speed of social media.
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"I like to call it my Golden Thread to Purchase," he said. "Instagram, Facebook, Twitter, Youtube, purchase, and we all need to embed ourselves in that process."

And when that fails? He asks Gen Z.

"When I need to understand how that process works, I go to my 13 year old daughter, and I say, 'hey, if you ran Bluemercury, what would you do?'"

3. It sells an experience.

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Blue Mercury is not just a cosmetics store; it also has a spa within it. Like Sephora and Ulta, which have in-store makeovers and salons respectively, it gives consumers a reason to say. (Plus, stores are trying to become more experiential since that's what millennials prefer to spend on these days — that, and makeup, cellphones, and Uber rides).

In fact, its lending its experience to Macy's. As Blue Mercury stores open up within Macy's locations, it lends itself to a sense of luxury and helps give Macy's the added experience that it may need. Beck told Business Insider how Bluemercury sells higher-end brands, like La Mer, that aren't sold at Macy's, and that it will be incorporate the element of grab-and-go cosmetics, something that Macy's has been experimenting with

It's a mutually beneficial relationship, though; Macy's provides Bluemercury with capital infrastructure, and soon-to-step-down CEO Terry Lundgren also helps him with some advice.

It's fast, too. Beck called it the "Uberization of services." He also noted that many professional women don't have a lot of time on their hands.

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