Another Nail in the Coffin for Department Stores?

Beauty products are a growing industry, and one retailer may be emerging as top dog. If you haven’t come across Ulta Salon, Cosmetics and Fragrance (Nasdaq: ULTA  ) before, now is the time to take notice. This bricks-and-mortar retailer is growing fast, expanding its nearly 500-store footprint with the idea of ultimately opening 1,200 stores in the United States.  

What’s most impressive about Ulta is its potential to disrupt the traditional department-store beauty product retailing model. The beauty products market is worth about $60 billion annually, and a significant portion of this market now belongs to department stores like Nordstrom (NYSE: JWN  ) , Macy’s (NYSE: M  ) , Dillard’s (NYSE: DDS  ) , and even JC Penney (NYSE: JCP  ) . But Ulta, the new kid in town, is rapidly winning market share. So which retailer is the better bet for your investment dollars? 

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