Inside the Strangely Profitable World of Discontinued Beauty

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The $15 bottles became a cultural touchstone (Uma Thurman even sported the hue in Pulp Fiction), as well as a mass market success. At the time, local brand rep Judy Biasalli was quoted as saying, "If I had a penny for everyone that wanted Vamp, I'd be rich. It's literally flying out of the store. In my 11 years with Chanel, I've never seen anything like this." Vamp was Chanel's best-selling product ever, which made the company's decision to yank it from stores a few years later all the more baffling to its legions of fans.

Welcome to the world of discontinued beauty, where popular and obscure products alike are shelved at whim. While some products receive a second life (like Vamp, which was revived in 2003 albeit with a different formula), many are gone forever. And though the fate of discontinued favorites is largely controlled by corporations, people like Daneen Woolstrum keep the secondary resale market alive and well.

For almost 40 years, Woolstrum has worked as a hairstylist and salon owner in Buffalo, New York; her professional expertise led her to found one of the top discontinued cosmetics websites, aptly called Discontinued Beauty. There, customers can find hundreds of phased-out products from beauty giants (Clinque, Aveda) and obscure brands (Orofluido, Dicesare).

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"I first started selling on the internet in order to liquidate products from my own salon," she tells Racked. "I developed an interest in discontinued beauty products in particular since I knew how valuable various haircare items are to many fellow stylists, as well as our clients. Their dedication led me onto a journey to try to keep these products available."

A few years later, Woolstrum's solo experiment has evolved into a full-fledged business with a 6,000-square-foot warehouse and a staff of three. "I tend to work with salons that might be closing or trying to liquidate their stock," she explains. "I've also gone to distributors and bought products straight from them. And since most salons want to stay with current items, I'll buy their old stock to sell online."

Rather than purchase products that might eventually make a comeback, Woolstrum prefers things that are gone forever. "I invest my money in companies that aren't producing these items anymore because they have been bought out by a larger company," she says. "For example, Proctor & Gamble is a very large company, which has bought out other brands like Sebastian."

Once a big corporation like P&G makes an acquisition, it often manufactures the acquired brands' product range for a very short period of time before discontinuing poor sellers and developing new formulas. This window of time is Woolstrum's sweet spot: She'll buy in bulk, and then wait for the customers to come once they realize their favorite product isn't anywhere else.

Discontinued Beauty doesn't discriminate; organized by brand, you'll find makeup, haircare, skincare, and beauty tools on the site. Most of the products are within the $10 to $30 range, but Woolstrum says she's sold some items for hundreds. "Redken's Extreme PPT Concentrates is probably my highest priced," she says. "I just sold it to someone from Japan for $500 because we ship all over the world." The serum, which aims to repair damaged hair, is currently listed on the site at $329 (on sale from $499).

Photo: Getty Images

Other big sellers include ARTec's patchouli shampoo (about $80) and Graham Webb's Bodacious perfume ($300). Although Woolstrum says almost all of the items she puts online are new, for especially popular products, she'll list partially used items with a "used" label: "People don't care, they'll still buy it."

Woolstrum also tracks trending products on eBay. "It's just about supply and demand," she says. "As an item becomes more rare, we see an upsweep online. I've even been mentioned in listings for other items, where they will refer back to my website in terms of the quotes. We really are the leader in terms of haircare, cosmetics, and appliances—not as much on the drugstore side, although we do stock that too."

That's not to say that drugstore buys can't be just as popular as designer brands in other corners of the internet. A quick browse through eBay reveals that Maybelline's Dream Match powder is listed for $400, assorted shades of L'Oreal lipsticks are priced at $399, and a rare pack of 13 Burt's Bees shimmer lip glosses is $250. Although many of eBay's top sellers declined to be interviewed, one seller who requested anonymity disclosed that she works in liquidation and gets products in bulk.

So, what makes a product worth pursuing for resale? For Woolstrum, it's about zeroing in on cult products. "Whether or not someone will buy a product isn't based on the original price," she explains. "The people don't care. They just really want what they can't have, and they will pay whatever they need to get it." Occasionally, brands recognize this too and bring back popular discontinued items.

Photo: Getty Images

MAC, Estée Lauder, and Chanel all have programs dedicated to reviving old products. One of the most notable is Estée Lauder's "Gone But Not Forgotten" initiative, which began in 2000. According to Linda Compton, executive director of the company's consumer care center, "Consumers contacted us, so we knew there was a demand for discontinued items. We realized that we not only had an opportunity to meet consumer needs by providing access to these products, but also were able to utilize our excess inventory at the same time, making it a win-win situation all around."

MAC's decision to bring back shades also relies heavily on customer opinion. The brand has held online surveys where fans vote on which products should return, and now, social media plays a major role. "A program we launched called MAC by Request is an example of how social media provides a perfect way to listen to our consumers," says Laura Elkins, a senior vice president of marketing for MAC. "One of our most popular lipstick shades, Candy Yum-Yum, was brought back into the permanent lineup, all because of consumer feedback, and it has become one of our top sellers."

Deborah Lippmann, celebrity manicurist and founder of her eponymous nail care line, says that because many of her polishes start out as limited edition, it's up to customers to decide which ones stay. "It's through social media that we are able to hear what consumers want back in the collection," she explains. "In the instances of the shades Constant Craving and Makin' Whoopee, their reappearance into the line led to social media love, praise, and support."

And while big companies check Twitter and track sales to see which products should be reintroduced from time to time, Woolstrum will always be there to give the people what they want. "They go to us to find what they can't have," she says. "We're just trying to keep up."