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The Complex World of Beauty and Retail
The beauty and skincare industry is worth $775 billion globally, making it one of the largest categories within retail. So how has the beauty and skincare shopper changed over the years, and what’s in store for the future?
Making up nine per cent of all online purchases the beauty and skincare industry is one of the most thriving categories within retail. From an eyeshadow palette to a jade roller, many consumers love to make a purchase online. However, according to new research by Teads, 66 per cent prefer to go in-store to try before they buy.
“They want to know what they are buying works for them personally, and will research the products to understand what ingredients are in it and if it is best suited for their skin type, and not just because it works for a beauty influencer,” said Lauren Douglass, the Vice President of Marketing at Teads. “As is often the trend today, the beauty buyer is seeking a personal experience.”
An online beauty shopper looks for particular things when they’re deciding what to purchase, the study found. Aside from the product quality, packaging and the product itself, the driving factor for purchase is the price.
Influencers … Are They Still Worth It?
It’s no secret that influencers are a staple in the beauty community. From YouTubers to reality stars, there are more influencers in the beauty industry than you can shake a stick at. However, their name ‘influencers’ holds less impact than it used to – in fact, their power of influence seems to be dwindling.
According to the report, only 17 per cent of health and beauty shoppers choose to take advice from an online influencer. There are a few factors behind this drop in impact: a lack of authenticity, dramatic behaviour and scandals can uninspire those from buying the products the influencer promotes. There have been several cases where influencers and celebrities have been accused of faking a review of their own beauty and skincare products. This results in a massive backlash and prevents the consumer from wanting to try the product.
According to the Power Retail Shopper Profile report, 62 per cent of online health and beauty shoppers want to follow an influencer that posts authentic content – it’s not all about the product itself.
So, what does that mean for retailers? When you’re choosing an influencer for your marketing, make sure that you do a background check of their content and past work. Just because someone is famous in their influencer circles, it doesn’t mean it’s the right fit for your brand. In fact, using the wrong influencer, no matter how big they are, can actually do more damage to your brand.
Celebrities and influencers like Millie Bobby Brown and Kylie Jenner received backlash for ‘faking’ their product reviews online.
In the Place of an Influencer
Beauty and skincare shoppers may not feel that great about influencers anymore, which can leave a gap in the market for something new. According to the study by Teads, 76 per cent of beauty consumers take action after they watch a video ad. The response they tend to take includes searching the product afterwards and heading to the brand’s site. Moreover, 31 per cent of consumers like video advertising, but only when it’s relevant to them.
What is ‘Relevant’ to Consumers?
While influencers may not stand out to consumers as much as they used to, there are plenty of other ways to cut through and reach your audience. Promoting products that specify skin type, price and available shades are three key ways to capture attention. Seventy-two per cent of beauty shoppers, both online and in-store say that suitability for skin type is the most influential factor when purchasing a product. Coming in second is the price of the product, with 71 per cent of customers saying its also one of the most important things to consider.
While it seems that beauty shoppers prefer to shop in-store when they’re buying items like foundation, skincare and lipstick, they’re not afraid of embracing the future. Technological advancements like AR and AI may just revolutionise the way beauty consumers make a purchase. According to the Teads study, 59 per cent of beauty and skincare shoppers see value in modern tech – this includes AR, virtual advisors and chatbots.
Among those customers, 25 per cent would use the tech to save time finding products and 18 per cent to save money. For the remaining 16 per cent, they would use the up and coming technology for less stress when buying a product. The younger the shopper is, the more likely they are to invest in new tech. Seventy-five per cent of the Millennials who were surveyed said they’d be happy to try AR and 42 per cent said they’re comfortable with the tech.
This try-on technology isn’t new, but some customers are still apprehensive about the platforms. One in three beauty and skincare shoppers said they’re not comfortable trying the tech, but the remaining 69 per cent said they’d be happy to try it.
Overall, beauty retailers should understand their customer before they reach out to social media influencers and make sure they’re taking care of what the customer wants. From skin types to a sense of authenticity, many things haven’t changed in the retail category. However, there are plenty of things that have changed, so it’s imperative to remember the customer’s needs.
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