During Revlon’s heyday in the 1980s, models Cindy Crawford and Claudia Schiffer appeared in television and magazine ads that promised to make women “unforgettable” with the brand’s bright red lipsticks.

Today, consumers are scrutinizing cosmetics on social media and a flood of trendy independent brands powered by celebrities like singer Rihanna and influencer Kylie Jenner that have sidelined Revlon. Overwhelmed by high debts, the 90-year-old American group, majority owned by billionaire Ron Perelman, filed for bankruptcy last week.

This high-profile casualty shows how competitive and fast the beauty industry has become, requiring heavy investments in digital marketing and product innovation to keep brands from losing relevance. Unlike other staples like food or household products where brands can survive for decades with minimal tweaking, consumer desires for beauty are changing rapidly, often influenced by culture, fashion and art.

“Indie brands are constantly taking risks and setting trends,” said Jefferies analyst Stephanie Wissink. “It’s as if the big, established beauty companies are like a turtle, racing not against a hare, but against hundreds of them.”

Industry leaders L’Oréal, Estée Lauder and Shiseido have learned to thrive in this new landscape by playing to their global reach and scientific know-how, and capturing the most promising independent brands to stay relevant.

But the likes of Revlon and Coty struggled because their cosmetics are more mainstream and lacked scale in the fastest growing category and market – skincare and China. Both have been constrained by debt accumulated in acquisitions, although Coty has made progress in paying it down, so analysts say it is unlikely to suffer Revlon’s fate.

The Covid-19 pandemic has pushed less nimble businesses further on the back foot as lockdowns and mask-wearing hit demand for beauty products while sending more consumers online. Supply chains for everything from plastics to pigments have been blocked, another advantage for big companies that have more influence over suppliers.

Global makeup sales have yet to recover to 2019 levels, although some categories like skincare and luxury fragrances have, according to data from McKinsey.

The strongest players, L’Oréal and Estée Lauder, have already surpassed their pre-pandemic sales, helped by their strong presence in the booming Chinese market and strength in skincare with brands like Lancôme and La Mer. L’Oréal has predicted that its sales growth will outpace the 4-5% expansion of the global beauty market this year.

By contrast, sales at Revlon, Coty and Shiseido are still languishing at pre-pandemic levels.

Even winners in the beauty industry have had a bad run on the stock market this year, as a combination of Covid-19 restrictions in China and fears of a global recession alarm investors. Estee Lauder is down 30%, L’Oreal is down 22% and Shiseido is down 18% – all underperforming Dow Jones Industrial Average and global consumer staples indices. Coty has fallen 30% this year and Revlon 38%.

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Although China has proven a boon over the past decade for some beauty companies, Beijing’s zero-Covid policy has dampened its appeal this year.

Estée Lauder in particular has been hit hard by recent lockdowns in China, triggering a profit warning in May. China accounts for around a third of its sales and its main distribution center is in Shanghai, the epicenter of the recent Covid-19 outbreak, leaving it unable to supply the rest of the country.

Given China’s role as the second-largest market for cosmetics after the United States, Jefferies’ Wissink said China would continue to weigh on the sector unless authorities backed down from their strict Covid-19 policy.

But in Paris, a destination for Chinese tourists when travel was easier, there were few signs of a slowdown in the high-end Bon Marché department stores this week where independent brands like Charlotte Tilbury vie for attention at sides of the Dior and Chanel pillars.

A vendor who declined to be named said it had been busy since international tourists returned and wedding season was in full swing. “People want to pamper themselves, so they bought beauty products that make them feel good,” the person said.

Elena Boulard said she came to the store looking for a new lipstick and bronzer as she plans to go to the office more this summer after a long period of working from home. “I haven’t bought any makeup in a while and there’s so much new stuff out there,” she said.

High-end beauty products have weathered the pandemic better than cheaper brands. In the United States, the “prestige beauty” market, which includes products sold by specialists such as Ulta and department stores, rose sharply last year to reach $22 billion, or 7% more than in 2019, according to NPD Market Research.

Luxury fragrances, including new brands that offer custom blends for an individual, have also seen a renaissance. “Consumers are trading in to afford a $300 bottle of perfume instead of the $80 one,” said Larissa Jensen of the NPD.

For Revlon, the nascent recovery came too late. But its problems go back much further: sales have been flat for much of the past two decades, except for a bump in 2016 when Revlon bought Elizabeth Arden and it has posted losses for the past six years. .

Analysts said Revlon’s brands failed to keep up with changing consumer tastes, which began to emphasize self-expression and accept flaws against unattainable beauty standards. Revlon’s weakness in skincare also means it hasn’t benefited from the boom in that category.

A strained balance sheet prevented the group from acquiring independent brands to refresh its product lines. Following its bankruptcy court filing, the company will continue operations while it develops a creditor repayment plan.

The way indie beauty brands often emerge from unexpected places underscores the magnitude of the challenges a flat-footed Revon faced.

Take Half Magic, a brand launched in May by Doniella Davy, a makeup artist who rose to prominence creating “emotional glam” looks for the actresses of the hit American teen drama Euphoria. On TikTok, the hashtag #EuphoriaMakeUp, where people post videos of themselves putting on brightly colored eyeshadow, glitter and neon gems inspired by the show, racked up 2.1 billion views.

While Half Magic may well die out, it’s emblematic of how new brands and trends flourish on social media. To keep up with the changes, major beauty companies have increased their digital marketing spend both to raise awareness of their brands and to catch trends as they emerge.

“If you want to run a successful cosmetics business these days, you have to pay an army of 20 people to be on TikTok and Instagram all day monitoring trends and engaging with people about your brands,” Iain said. Simpson, analyst at Barclays. “It’s not a business you can run rationally with a lot of debt.”

Coty chief executive Sue Y Nabi said in an interview that the group has “made a lot of progress” in using social media to renew its popular consumer brands, including CoverGirl and Max Factor. “Staying relevant is the most important thing,” she said, including jumping on consumers’ desire for so-called “clean beauty” products that eliminate harsh chemicals or using TikTok to attract consumers from Generation Z.

An example of how Coty is trying to freshen up older names came with the recent launch of a new mascara under its Rimmel brand. He enlisted a British TikTok influencer, Olivia Neill, to help design and promote the product called Thrill Seeker.

“It’s the first time we’ve done something like this,” Nabi said. “Companies like ours have learned to create viral products, just like independent brands do.”