What Does the Future Hold for Beauty Brand Retail?

What Does the Future Hold for Beauty Brand Retail?

Trends | Mar 02, 2021

Beauty and personal care sales hit an all-time low in its third and fourth quarters in 2020, but recent data shows that sales are on the rise again, especially with the demand for personal hygiene products currently growing.

At present, the majority of beauty brands’ successes have stemmed from online, with e-commerce sales predicted to account for over 23% of personal care spend by the end of 2021.

So, what trends are currently taking lead in beauty retail in the midst of the pandemic, and how are some brands following suit?

Creating online communities

While beauty brands will most likely work to create in-store connections, the majority of the focus is on digital matters, where online customer service is currently taking priority.

Image of beauty retail store

Tools such as virtual chat are no longer the innovative feature they once were. Beauty retailers have now taken a more humanistic approach, especially with the redirection of retail jobs to online.

One brand, Credo Beauty, has made the move to set up live virtual appointments with its consumers, where a brand expert will guide the customer on what products they should purchase. This feature now makes up 15% of Credo Beauty’s total revenue.

This begs the question: Why would consumers shop in-store when they can receive all the knowledge and advice they need online?

Well, it all comes down to the consumer’s own desires.

While beauty retail stores will always be in demand to a certain degree, the pandemic has shown just how easy it is to redirect customers to an online shopping base.

Uncertainty over brick-and-mortar stores 

With consumers becoming more accustomed to shopping online, it’s uncertain how brick-and-mortar stores will meet high demand once they reopen.

Some consumers will continue to shop online, but the reality of more in-store purchases will only become possible if beauty retailers can mimic the same personalization physically as they can digitally.

Image of a consumer online shopping

Simply put, retail stores that only offer the transactional experience will feel trivial and meaningless, especially if customers receive the same treatment online.

However, physical retailers that focus on customer connections and interactive experiences like the hip beauty brand Glossier, could triumph greatly.

Brands hop on board the Amazon train

Beauty brands have avoided selling through Amazon due to the lack of control regarding customers’ shopping experiences. But with the global closure of stores, many brands are now reconsidering.

Image of Amazon app

63% of consumers start their online searches for products on Amazon. For small or new beauty brands, this can convert into healthy sales.

Indie makeup brand, Wunder2, saw a 126% increase in sales during the quarantine period when they sold their core products through Amazon.

The platform is also now offering a new feature called Amazon Live, a shopping function where beauty retailers have the ability to connect directly with customers. With people now attending virtual brand events, this strategy has proven successful for many brands.

The use of virtual tools

When L'Oréal, the world's largest cosmetics company, pioneered the first virtual try-on tool for consumers to test makeup in 2018, many brands followed suit — embracing AR for beauty.

The demand for beauty AR tools has risen due to the pandemic, with popular platform Pinterest now offering its users the ability to try on 4,000 different products virtually from brands like NYX Cosmetics, YSL and Urban Decay.

Image of a virtual beauty app

Image via @theindustrybeauty

While these tools are intended to direct the consumer to make purchases, this medium is also being used as a smart marketing strategy that blends the beauty and tech worlds together.

This strategy also showcases two trends that have arisen out of the pandemic: increased digital communication and virtual beauty.

With consumers unable to discover products in-store, the reliance on AR beauty tools may become heightened, even after retail stores reopen within the year.

Looking to promote your online beauty brand? Our digital marketing services can do just that. Let’s talk! 

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