Target Buys Beauty Products E-Retailer

Target bought a company that hosts a trio of websites that sell beauty products; the deal marks the company’s third e-commerce acquisition since March.

Minneapolis-based retail giant Target Corporation announced Tuesday that it acquired DermStore Beauty Group, an El Segundo, California-based online beauty product retailer with 75 employees.
DermStore’s primary website is, an e-commerce site that sells about 26,000 different skin care beauty products from 750 brands. The company also recently launched two additional sites, and, which sell hair care and cosmetics products, respectively.
“There is no doubt that the online beauty industry is growing rapidly, and this unique opportunity enables Target to gain insight into the superior, online customer experience DermStore provides,” Casey Carl, president of Target’s mobile and online marketing strategy, said in a statement. “Not only will DermStore’s 750-plus brands offer Target expanded breadth across the beauty and skincare industries, but also access to exceptional content and helpful resources we know consumers want.”

DermStore will become a wholly owned subsidiary of Target but will continue to operate as a separate entity under its own name. According to Target spokeswoman Katie Boylan, there will be no employee turnover or office relocation as a result of the acquisition.

Target doesn't plan to sell its products through the DermStore sites; nor will DermStore products be sold on Target’s website or in its stores, Boylan said.

Target said the transaction was made as a “strategic growth opportunity” and that it would not have any “material” impact on the company’s 2013 financial results.

Dan Obegi, who previously served as CEO of DermStore, will be president of the wholly owned subsidiary and will report to Carl.

The transaction is expected to close within 60 says, Target said.

The DermStore purchase follows two additional e-commerce acquisitions Target made in March. The company purchased and in two separate transactions in an effort to expand its presence in the cooking and kitchenware markets. Like DermStore, those brands continued to operate under their previous names.

Target also recently expanded its “beauty concierge services” in May, which consists of trained beauty professionals to answer questions in Target stores.

Target is Minnesota’s second-largest public company based on revenue. It operates 1,856 stores—1,788 in the United States and 68 in Canada.