The pandemic has irreversibly changed the purchasing habits of consumers in all categories. In particular, for categories like beauty that sold primarily in stores, the impact was more visible. With lockdowns and security concerns, e-commerce has become the primary channel for shoppers. Beauty brands and retailers said e-commerce sales were twice as high as pre-COVID-19 levels, according to McKinsey, and it is estimated that a 20-30% growth in online sales of beauty products will continue during the pandemic. It is reported that 66% of Gen Z shoppers and 58% of Millennials say they spend more time looking at beauty products online now than before the pandemic.
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Digital native beauty brands have managed to capitalize on this trend and double their sales both on their own D2C channels and in online marketplaces like Amazon. Big heritage brands that traditionally sold in-store, in some cases with in-person beauty consulting services, are rapidly transforming their approach to be successful in this new world. In an age where in-person connection poses a huge hurdle, driving customer engagement to retain them is increasingly important for beauty brands that want to attract more consumers.
Shopalyst works with over 450 brands in 30 countries and serves some of the best beauty brands like Estée Lauder, L’Oréal Paris, Maybelline, Bobbi Brown, among others. This gives us a big picture of the transformation of the industry and here are three big trends we are seeing:
Virtualize beauty: Live the online store experience
Brands are investing in digital capabilities to deliver engaging online experiences that provide consumers with virtual equivalents of the familiar in-store experience. Examples include L’Oréal’s Modiface which uses augmented reality to help users visualize makeup and hairstyles on themselves. Google has launched a virtual trial for certain beauty products when they appear in search results. Sephora encourages the use of its “virtual artist” tool to replace in-store purchases. Other brands like Bobbi Brown use Shopalyst to create guided selling experiences that include advice from beauty experts and influencers.
Content Marketing: Investing In Content That Helps Consumers
The pandemic has also brought about a change in consumer behavior, from salon care to personal care at home. The best brands are investing in content on YouTube and other social media that helps consumers navigate this transition. For example, Garnier offers videos on DIY hair coloring at home. Bleach London offers “Hair Party”, a digital salon organized by the brand. Blume, a digitally native beauty and personal care brand, has launched a series of themed weekly live broadcasts on TikTok offering viewers discounts and freebies. Clinique, a subsidiary of Estée Lauder, builds customer loyalty by creating customer profiles around their virtual consultations developed from quizzes and personal data shared by buyers. Brands like Garnier and Estée Lauder are leveraging the no-code Shopalyst platform to create instant microsites to host this content and activate it with consumers on popular platforms like Facebook, Instagram and YouTube.
Easy access to purchase: make all digital ads purchasable
Digital media increased their share of ad spend even before the pandemic and has now become the primary channel for many brands to connect and engage with their consumers. Advertising experiences are also evolving – simple banner impressions are no longer the end of the game. Consumers expect advertising to be interactive and help them learn more about the brand, discover related products and to be able to shop without friction. The world’s top beauty brands use Shopalyst to personalize and buy their digital ads so consumers can now interact and buy the brand directly from ads on YouTube, Facebook, Instagram, and other popular media platforms.
The beauty brands that succeed in this new environment will be those that integrate creativity, technology and data to connect with consumers in the moments that matter, and help them discover and buy easily. This approach creates the best results for consumers (meaningful brand experiences), brands (higher return on their ad spend) and retailers (lower customer acquisition cost). The evidence for the pudding comes from an analysis of over a billion ad-enabled shopping trips powered by Shopalyst.
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