Abstract:

This research paper critically investigates the phenomenon of racial capitalism within the cosmetic industry in the United States, with a particular focus on the exploitation of racial biases and discriminatory practices against African Americans. In pursuit of comprehensive answers, this paper delves into the corporate practices employed by major cosmetic companies, uncovering marketing strategies, product development, and labor practices that perpetuate racial disparities and discriminatory norms. The research also examines consumer behaviors and their role in reinforcing racial biases, underlining how these biases are both shaped and exploited by the cosmetic industry. Furthermore, this paper highlights instances of resistance and calls for change within the cosmetic industry, providing a nuanced perspective on ongoing efforts to challenge and rectify racial biases. It underscores the critical need to scrutinize industry practices, emphasizing that while cosmetic companies may publicly endorse diversity and inclusivity, their actions reveal a deeper commitment to profit generation through the perpetuation of racial inequalities. This research paper aspires to contribute to a broader understanding of racial capitalism within the cosmetic industry while shedding light on the industry's complex relationship with racial biases. By unveiling the mechanisms through which racial capitalism operates within the cosmetic industry, this research paper aims to inspire critical discourse, encourage ethical consumer choices, and ultimately, advocate for a more equitable and just beauty market in the United States.

Background Information

"Since their inception in the early 20th century, cosmetic industry giants like Sephora and L'Oréal have consistently pursued strategies to enhance their financial standing. With L'Oréal boasting a substantial net worth of $239.82 billion (Macrotrends, 2023) and Sephora's parent company, LVMH, commanding a net worth ranging between $400 billion to $500 billion (Treymayne-Pengelly, 2023), these brands have undeniably established themselves as formidable entities within the beauty sector. While these financial achievements are noteworthy, it is imperative to acknowledge that brands such as those mentioned have garnered profits through the deliberate exploitation of racial biases and the implementation of discriminatory practices, particularly against African Americans.

The cosmetic industry has cultivated a culture of colorism, one that accentuates the perceived 'superiority of white skin' while perpetuating the fallacious notion that whiteness inherently
surpasses blackness. This has been achieved through astute marketing strategies employed by companies within the cosmetic sector, alongside the imposition of formidable barriers that impede the progress of black beauty business owners.

Methodology

To address the research question and objectives of this paper regarding the exploitation of racial biases within the cosmetic industry in the United States, a mixed-methods research approach is employed. The research includes both a comprehensive literature review, encompassing academic articles, industry reports, and news articles as well as qualitative methods such as content analysis of marketing materials, advertising campaigns, and corporate statements from major cosmetic companies. The comprehensive literature review as well as the examination of academic articles serves as the foundation for understanding the broader theoretical framework surrounding racial capitalism. The qualitative methods are used to examine the contemporary landscape and identify instances of racial biases, discriminatory practices, and the perpetuation of racial hierarchies within the cosmetic industry. Complementing these methods, a quantitative analysis is employed to assess consumer behaviors and attitudes. The data used from the surveys from the Racial Bias in Retail Study commissioned by Sephora were administered to a diverse sample of consumers to gauge their perceptions of beauty standards, purchasing habits, and awareness of racial biases within the cosmetic industry.

All sources utilized in this research paper are drawn from reputable and well-established publications, ensuring the highest standards of credibility and reliability in the research. I have extensively referenced insights and findings from renowned organizations such as McKinsey & Company, a globally respected management consulting firm known for its rigorous research and expertise in various industries. Moreover, I have incorporated scholarly articles from the Harvard Business Review, a distinguished source for cutting-edge research and thought leadership in the business world. Additionally, the analysis encompasses reports and articles from internationally recognized news outlets, including CNN and Forbes, renowned for their commitment to factual reporting and in-depth analysis. The utilization of such esteemed sources ensures that the research paper maintains a foundation of credibility and accuracy while examining the complex dynamics of racial capitalism within the cosmetic industry in the United States. Also, all the sources cited in this research paper are post-2020, aligning with the contemporary relevance of the issues addressed, which gained mainstream attention and scholarly scrutiny relatively recently. This temporal focus ensures that the research reflects the evolving landscape of racial capitalism and racial bias within the cosmetic industry in the United States.

Introduction

The cosmetic industry, with its global worth exceeding hundreds of billions of dollars, wields immense economic power and cultural influence. Its products are omnipresent, from drugstore aisles to high-end boutiques, and from social media advertising to glossy magazine spreads. The industry capitalizes on human desires for self-expression, self-confidence, and the pursuit of beauty ideals that vary across time and geography. However, beneath the veneer of empowerment and self-improvement lie deep-seated issues that transcend the superficial allure
of cosmetics. These issues resonate with broader societal concerns such as environmental sustainability, labor exploitation, and, significantly, racial biases.

This research paper aims to shift the spotlight towards an underexplored facet of the cosmetic industry—the insidious connection between racial capitalism and the perpetuation of racial biases within the sector. While the industry promises diversity and inclusivity in its advertising, beneath the surface, it often perpetuates racial hierarchies through practices like product formulation, marketing strategies, and workforce diversity, or the lack thereof. To comprehend this multifaceted problem, we will navigate the intricate web of capitalist structures within the cosmetic industry, unraveling how they intertwine with racial dynamics. Through rigorous analysis and empirical evidence, this paper will explore the mechanisms by which racial capitalism is not merely an unfortunate byproduct but a perpetuating force, and how confronting these issues is crucial for promoting a more equitable and just cosmetic industry.

Findings

One of the initial topics to be examined in this paper pertains to the case of Munroe Bergdorf and the subsequent rehiring. In August 2017, L’Oréal, a prominent cosmetics company made a significant move by appointing Munroe Bergdorf, an African-American transgender model, as the face of their campaign. This appointment was widely perceived as a positive step toward promoting diversity and inclusivity within the industry. Notably, Bergdorf's intersectionality as an African-American and transgender individual sheds light on a community that has historically faced discrimination and underrepresentation (Aviles, 2020). However, the promise of this move soon unraveled as L’Oréal took an unexpected turn. On September 1st of the same year, Munroe Bergdorf was terminated from her position due to content she shared on her Instagram platform, which addressed issues related to white privilege and societal racism. L’Oréal's official statement emphasized the company's commitment to diversity and tolerance, irrespective of race, background, gender, and religion (Loreal, 2017). Yet, they asserted that Bergdorf's comments about white individuals were incongruent with these values. This incident exposed a disconcerting aspect of the cosmetic industry's approach to diversity and inclusion. It became evident that L’Oréal's hiring of Munroe Bergdorf, while initially appearing as a commitment to diversity, came with an unspoken expectation of compliance and silence on matters of racial inequality. Importantly, these comments made by Bergdorf were from a time preceding the widespread resurgence of the Black Lives Matter (BLM) movement in 2020. In 2017, such movements were not as prominent, and cosmetic companies like L’Oréal seemed unwilling to risk alienating their customer base by engaging in conversations about racial injustice.

In June 2020, L’Oréal, like many other companies, posted messages in support of the BLM movement and showcased their dedication to diversity and inclusion. Remarkably, these sentiments echoed the very comments that had led to Munroe Bergdorf's termination in September 2017. This example underscores a critical phenomenon within the industry, where companies strategically adjust their positions and align themselves with prevailing social movements, such as the BLM movement in 2020. While it may be tempting to assume that cosmetic companies are strong advocates for diversity and inclusion based on their current marketing campaigns, it is essential to scrutinize their past actions to gauge the sincerity of their statements. Cosmetic companies, driven by the imperative to sustain profitability, often adapt to
align with prevailing social sentiments. For instance, L’Oréal reported an annual revenue of $31.975 billion in 2020 underscoring the substantial economic stakes involved (Macrotrends, 2020). These companies, driven by the need to protect their economic interests, may make statements of support and solidarity with these movements, even when their past actions suggest otherwise. Without strategic alignment, companies like L’Oréal risk boycotts and public backlash from social advocacy groups, a common tactic employed to amplify their demands. This exemplifies the adaptability and opportunism inherent in racial capitalism, where companies pivot their positions to align with prevailing sentiments. In essence, this case study serves as a compelling illustration of how cosmetic companies navigate their positions in response to mainstream social movements. It reveals that these firms are willing to perpetuate discriminatory practices until compelled by the pressure of prevailing social sentiments, such as the BLM movement, to endorse organizations advocating for racial equity and justice.

Munroe Bergdorf's experience within the cosmetic industry also serves as a poignant case study that vividly illustrates the intricate dynamics of racial capitalism. Racial capitalism is defined as both the simultaneous historical emergence of racism and capitalism in the modern world and their mutual dependence (Kundnani, 2020). Bergdorf’s hiring by L’Oréal, ostensibly as a commitment to diversity and inclusivity, took a disconcerting turn when she was subsequently fired for speaking out against white privilege and societal racism on her Instagram platform. This episode underscores how racial capitalism operates within the cosmetic industry, revealing the delicate balance cosmetic companies often strike between projecting an image of inclusivity and maintaining profit margins. Racial capitalism within the cosmetic industry operates by prioritizing profit over principles of equity and justice. Companies like L’Oréal may hire individuals from marginalized communities as a form of tokenism, using them to project an image of diversity while expecting them to remain silent on matters of racial injustice. When these individuals do speak out, they often face repercussions, as was the case with Munroe Bergdorf. In essence, Munroe Bergdorf's experience encapsulates the complexities of racial capitalism within the cosmetic industry. It underscores the industry's propensity to use diversity as a marketing tool while being hesitant to engage in substantive conversations about racial equity. By critically examining this case, we gain valuable insights into the delicate balance cosmetic companies must strike between projecting an image of inclusivity and maintaining profitability, all within the framework of racial capitalism.

An illustrative mechanism through which cosmetic companies harness racial bias and perpetuate stereotypes is evident in their promotion and sale of whitening creams. Historically, dating back to their inception in the early 20th century, cosmetic industries predominantly relied on white models for the advertisement of their products, with minimal representation of diversity. It was only as recently as 2021 that Sephora, a prominent company in the beauty industry, announced its inaugural campaign to spotlight black-owned brands (Braun, 2021). However, these companies have inadvertently contributed to the cultivation of a culture steeped in colorism—an intricate web of beliefs and practices that uphold and prioritize white standards of beauty. Such standards often encompass attributes like straight hair, thin lips, and noses. It is imperative to recognize that colorism is an offspring of racism, influencing numerous African American women to invest in whitening creams in pursuit of conformity to the established 'beautiful' archetype. While these cosmetic industries may not have consciously aimed to promote colorism, their historical employment of predominantly white models over the years has inadvertently
catalyzed the growth of a substantial skin whitening market, which now commands a staggering valuation exceeding $8 billion (Senthililngham, Munsi, & Offiong, 2022). This market phenomenon is underpinned by the disparities in representation and the perpetuation of Eurocentric beauty ideals. Notably, McKinsey & Company, in its comprehensive analysis of Black representation within the beauty industry, took both quantitative and qualitative approaches. Their findings indicate a significant disconnect between beauty advertisements and black audiences, primarily attributed to the glaring absence of diverse portrayals and the failure to resonate with individuals possessing melanin-rich skin, textured hair, and unique facial features (Burns, Weaver, & Zegeye, 2022).

Colorism is a deeply ingrained and pervasive form of discrimination based on the varying shades of skin color within a particular racial or ethnic group. Colorism can be defined as “upholding and valuing white standards of beauty including the preference for straight hair or thin lips and noses” (Mallick, 2021). It operates as a hierarchical system, privileging lighter skin tones while stigmatizing darker ones. Colorism is particularly insidious because it not only reinforces racial prejudices but also intersects with and reinforces the mechanisms of racial capitalism within the cosmetic industry. In the context of the cosmetic industry, colorism manifests in several ways. One of the most striking examples is the prevalence of skin-lightening products, which are marketed and sold predominantly in regions with a history of colonialism and enduring colorism. These products promise to lighten the skin, subtly implying that lighter skin is not only more beautiful but also socially advantageous. The promotion of such products serves as a stark illustration of colorism's entrenchment within the beauty market. Racial capitalism is evident as cosmetic companies exploit colorism to generate profits. They capitalize on the insecurities created by colorism, encouraging consumers to purchase products that promise to alter their skin tone to conform to Eurocentric ideals. By catering to these insecurities, companies perpetuate racial hierarchies, where lighter skin is considered more desirable, and darker skin is stigmatized. This exploitation further entrenches the racial biases inherent in the cosmetic industry, as companies profit from the very prejudices they help perpetuate. Additionally, colorism within the cosmetic industry extends to representation and inclusion. Darker-skinned individuals, particularly those from Black and other marginalized communities, have long been underrepresented in product lines and advertising campaigns. This underrepresentation reflects the industry's broader racial biases and the prioritization of profit over genuine inclusivity. In essence, colorism within the cosmetic industry serves as a striking example of how racial capitalism operates to perpetuate racial biases for profit. Cosmetic companies exploit the insecurities and biases created by colorism, profiting from the perpetuation of Eurocentric beauty standards and the marginalization of darker-skinned individuals.

A salient illustration of the pervasive influence of racial capitalism is encapsulated in the ongoing challenges faced by emerging black-owned beauty brands. The demographic landscape of the United States is evolving, with Black Americans numbering close to 41 million, a substantial and increasingly influential consumer group. Within the vast and lucrative beauty market, Black consumers contribute significantly, having expended approximately $6.6 billion, representing 11.1% of the total market (Burns, Weaver, & Zegeye, 2022). However, a stark disconnect emerges when one examines the financial representation of black-owned beauty brands, which account for merely 2.5% of the industry's revenue. This glaring disparity speaks to the complex interplay of economic forces and systemic biases inherent within racial capitalism.
A multitude of factors contribute to this imbalance, with one notable variable being the arduous journey of product development that confronts black-owned businesses. Remarkably, since their inception in the early 1900s, cosmetic companies have allocated minimal resources toward research and development tailored to the distinctive characteristics of black hair and beauty. Conventionally, research in the formulation of beauty products, such as shampoos and conditioners, predominantly relies on a template of blonde, straight hair. The consequence of this prolonged oversight is a profound lack of knowledge and expertise pertaining to black hair. Consequently, black-owned companies are compelled to invest substantial resources in independent research and development, incurring considerable costs in the process. According to Growthink Consulting, a reputable strategic advisory and investment banking service, the average expenditure associated with developing a single beauty product ranges from $10,000 to $30,000. This places a considerable financial burden on black-owned brands, with the median capital raised standing at $13 million in stark contrast to the $20 million raised by their non- black counterparts. The discernible gap in available resources and research-backed insights underscores the inherent disparities perpetuated within the beauty industry. McKinsey's previous research findings add another layer of concern, projecting that if the current trajectory of inequity persists, it will necessitate an astonishing 95 years for black employees to attain talent parity across all levels within the private sector. Within the beauty industry, this translates into non- black employees at prominent brands and retailers assuming decision-making authority regarding product selection and strategies to support black founders, often without a lived understanding of the black consumer experience. Consequently, this dynamic severely hampers the ability of black-owned beauty brands to establish themselves, compete on equal footing, and sustain growth within the industry. In essence, the plight of developing black beauty brands within the framework of racial capitalism is a poignant reminder of the systemic disparities that persist in the beauty industry. While black consumers exert substantial economic influence, the limited representation and resources allocated to black-owned brands underscore the urgent need to address the systemic inequities that continue to shape the landscape of the beauty market.

Another stark illustration of racial capitalism permeates the marketing campaigns employed by major cosmetic corporations. These campaigns, while ostensibly aimed at promoting beauty products, have at times exhibited disturbing racial biases, thus underscoring the systemic issues ingrained within the industry. One noteworthy example harks back to a 2011 advertising campaign by Nivea, in which a deeply problematic message was conveyed. The ad featured a diminutive black man holding a decapitated head adorned with an afro and beard, with the implication being that black men needed to "re-civilize" themselves. This grotesque depiction perpetuated harmful stereotypes and hinted at a deeply disturbing narrative about black masculinity. Similarly, in 2017, Dove faced significant backlash over an advertising campaign that featured a black woman removing a brown t-shirt to reveal a white woman underneath. The messaging insinuated that Dove's body wash had "cleansed" the black woman, implicitly elevating the superiority of white skin over black skin. These advertisements, among others, unveil a disconcerting aspect of racial capitalism within the cosmetic industry. They exemplify how cosmetic companies while striving to boost their profits, are willing to perpetuate harmful stereotypes and engage in racial insensitivity that serves to undermine the image of Black Americans. While some cosmetic giants like Louis Vuitton (LV) and Yves Saint Laurent (YSL) Beauty have increased the visibility of black models in their marketing, a nuanced examination reveals underlying biases. These brands often feature models with racially indeterminate
features, favoring those with lighter skin tones who are perceived as less ethnically distinct (Mallick, 2021). This strategic approach is notably observed by black consumers, with approximately 74% expressing dissatisfaction with marketing that fails to showcase a diverse range of skin tones, body types, and hair textures (Claytor, Crockett, Fowler, & Raspberry, 2020). Furthermore, an analysis conducted by EyeCue Insights underscores the dynamic nature of representation in cosmetic advertising. Prior to the summer of 2020, only 13% of images featured darker-skinned models. However, in June 2020, darker-skinned models accounted for nearly 25% of images. Regrettably, this increase was short-lived, plummeting back to 16% in August. This fluctuation serves as a stark reminder of how companies strategically position themselves in alignment with prevailing social movements to safeguard their consumer base, often at the expense of genuine commitment to diversity and inclusion. In essence, the marketing strategies of cosmetic conglomerates offer a profound insight into the intricate interplay between racial capitalism and the beauty industry. These companies, in their pursuit of profit, have at times exhibited a disregard for the racial biases inherent in their campaigns, perpetuating harmful stereotypes and fostering racial insensitivity.

Conclusion

In the journey of this research, a comprehensive examination of racial capitalism and racial bias within the cosmetic industry has unraveled deeply entrenched issues that demand critical attention. While the identification of these issues has become increasingly discernible, it is imperative to chart a course toward solutions that can facilitate transformative change within this industry. One avenue that cosmetic companies have explored to foster more inclusive environments is the establishment of diversity consultants and diversity boards. While these initiatives have been articulated as pivotal steps towards greater inclusivity, an inherent lack of empirical research addressing their efficacy becomes apparent. Consequently, one of the salient conclusions drawn from this exploration is the pressing need for further research. Investigating not only the role of diversity boards within corporate environments but also the tangible effects and effectiveness of these boards becomes paramount. It is crucial to discern whether these endeavors are merely performative, serving as marketing instruments to project an image of increased diversity, or if they genuinely contribute to enhancing the experiences of black consumers within cosmetic stores.

Another imperative conclusion drawn from this inquiry is the urgent necessity for prominent beauty conglomerates, such as Sephora and Ulta, to take proactive measures in incubating black beauty brands. These budding brands often grapple with formidable barriers to entry, struggling to secure coveted shelf space, let alone generate sustainable profits. This predicament does not stem from a dearth of demand, but rather from the formidable costs associated with research and marketing. McKinsey and Company's assertion that incubating approximately 500 black beauty brands would be a catalytic starting point in reshaping the industry underscores the magnitude of the transformation required.

Furthermore, augmenting the representation of black employees within the cosmetic industry emerges as a pivotal strategy. The Sephora Racial Bias in Retail Study illuminates a disconcerting reality, with three out of five individuals reporting experiences of racial bias within cosmetic stores. Significantly, instances of bias appear to diminish when black consumers have
the opportunity to engage with fellow black employees. In this light, the imperative to increase the number of black employees by at least 15% is underscored. This measure aligns with the industry's overarching aim of fostering an environment where black consumers feel respected, valued, and supported, ultimately enhancing their willingness to engage with and support black- owned brands.

In closing, the cosmetic industry stands at a crossroads, where the profound exploration of racial capitalism and racial bias unveils the magnitude of change needed to cultivate an equitable and inclusive space. Solutions that encompass empirical research, the incubation of black beauty brands, and the augmentation of black representation form the bedrock of this transformation. The path forward is challenging, but the imperative to dismantle systemic inequities within the cosmetic industry is an undertaking steeped in ethical responsibility and economic promise.

Sources:

Tremayne-Pengelly, A. (2023) Billionaire Bernard Arnault’s net worth has had its ups and downs, Observer. Available at: observer.com/2023/06/bernard-arnault-net-worth-changes/

Hall, A. (2021) Racism in the Beauty Industry, DigitalCommons@SHU. Available at: digitalcommons.sacredheart.edu/acadfest/2021/all/10/

Arun Kundnani (2023) What is racial capitalism?, Arun Kundnani. Available at: kundnani.org/what-is-racial-capitalism/

Virdee, S. (2014) Racism, class, and the racialized outsider. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan.

Blicksilver, E. (1983) ‘Review: women, race and class by Angela Y. Davis’, Explorations in Ethnic Studies, ESS-3(1), pp. 7–8. doi:10.1525/ess.1983.3.1.7.

L’OREAL sa net worth 2010-2022: LRLCY (2023) Macrotrends. Available
at: macrotrends.net/stocks/charts/LRLCY/loreal-sa/net- worth#:~:text=Interactive%20chart%20of%20historical%20net,15%2C%202023%20is%20%24 233.63B.

Marketing still has a colorism problem (2021) Harvard Business Review. Available at: hbr.org/2021/05/marketing-still-has-a-colorism-problem

Claytor, C.P. et al. (2020) The Racial Bias in Retail
Study, sephora.com/contentimages/belong/january2021/Sephora_RacialBias_eBook _DES_12-23-20_V12%20(1).pdf.

McEvoy, J. (2020) L’OREAL, Unilever reassess skin lightening products-but won’t quit the multi-billion dollar market, Forbes. Available at: forbes.com/sites/jemimamcevoy/2020/06/26/loreal-unilever-reassess-skin-
lightening-products-but-wont-quit-the-multi-billion-dollar-market/?sh=4b3a1339223a (Accessed: 17 September 2023).

Ramirez, R. (2020) Beauty companies are changing skin-whitening products. but the damage of colorism runs deeper., Vox. Available at: vox.com/first- person/2020/6/30/21308257/skin-lightening-colorism-whitening-bleaching (Accessed: 17 September 2023).

Munroe Bergdorf rehired at L’Oréal, 3 years after being fired over white supremacy comments (2020) NBCNews.com. Available at: nbcnews.com/feature/nbc- out/munroe-bergdorf-rehired-l-or-al-3-years-after-being-n1228376

Baboolall, D. et al. (2022) Black representation in the Beauty Industry, McKinsey & Company. Available at: mckinsey.com/industries/consumer-packaged-goods/our- insights/black-representation-in-the-beauty-industry

US, FashionNetwork. com (2021) Sephora launches first black-owned brands
campaign, FashionNetwork.com. Available at: us.fashionnetwork.com/news/Sephora- launches-first-black-owned-brands-campaign,1328269.html

Senthilingam, M., Munsi, P. and Offiong, V. (2022) What is skin whitening, what are the risks and who profits?, CNN. Available at: cnn.com/2022/01/25/world/as-equals-skin- whitening-global-market-explainer-intl- cmd/index.html#:~:text=The%20global%20market%20for%20skin,half%20that%20within%20si x%20years.&text=Women%20account%20for%20almost%2080%25%20of%20sales%20world wide.&text=Creams%20dominate%20the%20market%20and,reach%20%246.6%20billion%20b y%202027. (Accessed: 17 September 2023).

Curry, L. How brands can follow through on the values they’re selling (2023) Harvard Business Review. Available at: hbr.org/2020/08/how-brands-can-follow-through-on-the-values- theyre-selling
Baird, M.L. (2021) ‘making Black more beautiful’: Black women ... - wiley online library. Available at: onlinelibrary.wiley.com/doi/10.1111/1468-0424.12522