The global beauty industry—comprising skin care, hair care, fragrances, color cosmetics and personal care products—generated more than $530 billion in 2019. But as the pandemic took hold in 2020, an estimated 30% of the beauty-industry market was shut down (McKinsey). With consumers’ faces concealed behind masks for much of the year, sales in most makeup categories declined sharply, unable to be offset even by a spike in demand for hair care and skin care products.
However, as consumers became vaccinated, mask restrictions eased and social activity climbed to pre-pandemic levels, sales in 2021 began picking up steam. Though the delta variant has become a growing concern, creating uncertainty around the future of mask-wearing and the impact on future sales, what is certain is that peak season is coming—and retailers must be prepared to deliver. In this blog post, we’re diving into the impact coronavirus has had on cosmetics sales, trends shaping the industry and how Visible helps beauty retailers deliver brand-elevating customer experiences.
Last year, as social events disappeared from calendars and people hunkered down at home, global sales of color cosmetics suffered a decline of 33%. With the lower parts of consumers’ faces being covered by masks, lip product sales took the greatest hit in the makeup category, falling 15% in the spring of 2020. But as consumers began receiving vaccinations and resuming social interactions earlier this year, cosmetics sales began to rebound. Out of the beauty care categories tracked by Nielsen, the cosmetics segment has seen the fastest sales growth, up 24.7% over a 12-week stretch from last year. Lipstick sales shot up 80% in the four weeks ending April 18 from the same period last year, though still falling short of pre-pandemic levels.
Beauty brands posting sharp sales increases in Q2 2021 include Revlon (43%) and E.l.f. Beauty (50%). L’Oréal’s sales for the first half of this year were up 16.2% over the same period in 2020 with a “marked recovery in makeup,” and with shoppers splurging on fragrances and cosmetics, Coty announced in August that it expects to post full-year sales growth for the first time in three years.
Throughout the pandemic, retailers have had to adapt to consumers’ shifting shopping behaviors and expectations. With store closures limiting the physical aspect of beauty sales, brands had to rely more heavily on technology and focus on creating a satisfying, convenient ecommerce experience. For example, virtual try-ons—an online feature that allows consumers to see what products look like on them without having to set foot inside of a store—are becoming more prevalent, as well as “chatbots” that function as virtual store assistants.
Beauty retailers also have enhanced the online experience for shoppers by providing greater visibility of in-store and online inventory, offering free and easy product returns and broadening fulfillment options to include buy online and pick up in-store (BOPIS) or curbside pickup. But innovation isn’t just happening online; retailers are implementing new in-store technologies like touchless fragrance testers to provide safer, contact-free testing options.
Beauty trends are ever-evolving, and as consumer values, behaviors and expectations in this space shift, retailers must be able to adapt accordingly. Here are the major trends making waves in beauty—and bringing attention to gaps in the marketplace that large and niche retailers alike are aiming to fill:
Social media is an undeniably powerful tool for many retailers, helping them engage consumers, boost brand recognition and increase sales. Within the beauty space, it has become common for retailers to partner with influencers and allow consumers to purchase products directly through social platforms like Instagram and TikTok. But social media also gives consumers the ability to publicly voice their opinions immediately and directly to brands—and Forbes research shows that’s exactly what they’re doing.
Due to the ecommerce surge brought on by the pandemic, consumers shared more online reviews in 2020 than the previous year in nearly every segment of the cosmetics ecommerce industry. These reviews often reference the online shopping experience, including website design, checkout/payment and customer support. Also “hugely important” to consumers and likely to be mentioned in reviews, according to Forbes, are packaging, shipping and delivery—which makes doing these well essential to a brand’s reputation.
In this crowded industry where new brands are emerging at a breakneck pace, it is critical for retailers to set themselves apart. This means not only selling a high-quality product, but also providing a smooth, convenient shopping experience and ensuring the right product gets to customers timely and safely. Visible helps some of the biggest names in beauty deliver this type of experience with our tech-driven parcel, fulfillment, logistics and packaging solutions. Features of our solutions include:
Amid the pandemic, beauty brands have been challenged to swiftly broaden their fulfillment options and implement tech solutions such as online storefronts and virtual try-on features—all with the goal of making the shopping experience as seamless and convenient as possible. Now, retailers face another challenge: peak season. This time of year can make or break shoppers’ opinions of brands, and with capacity expected to be tight again this year, it will be vital to have strong supply chain and packaging solutions in place.
Visible helps companies thrive during peak season by providing accurate and speedy fulfillment, scaling efficiently to meet demand and leveraging our onsite corrugated sheet plant to ensure clients have access to the packaging they need. We also help customers implement optimized multi-carrier solutions, a risk-mitigation strategy that proved highly effective last year when carriers capped shippers’ volumes—something that is likely to occur again this year.
Although it can be a challenging time, peak season can also be the perfect opportunity to set your company apart from your competitors and deliver an experience your customers will rave about. Fill out our contact form or call 877-728-5328 to discuss solutions for your business today.