The way we consumers think about the products we wear, the food we eat, the air we breathe, and in general the brands we support is shifting towards our personal health and well-being.
As a nation, we are progressing. In 2014, records show nearly 17 out of every 100 US adults smoke cigarettes. 50 Years ago, that number was more than double at a recorded 42.4%.
Other areas are more troublesome. Reports from 2016 reflect an estimated more than one-third (36.5%) of U.S. adults suffer from obesity and an estimated 1,685,210 new cases of cancer will be diagnosed in the United States.
The new “market of prevention” is not a trend; this is a shift in behavior, in lifestyle, and in one’s approach towards holistic consumerism. And it impacts all verticals and product categories.
Let’s take a look at the opportunity for the beauty category and discuss how to hit the right moving and shifting consumer targets.
Understanding the Opportunities and Identifying the Obstacles
According to Women’s Marketing Projections from 2014, the Health and Wellness market space is dominated by:
- Beauty and Anti-Aging Products at $679 Billion
- Fitness and Mind & Body Exercise at $390 Billion
- Healthy Eating, Nutrition, and Weight Loss at $277 Billion
As One Rockwell has been working within the fashion, luxury and lifestyle space for a number of years, we recently came across an interesting article about the opportunities within this holistic “market of prevention”.
“Prevention means you take care not to get sick, and wellness implies the absence of disease. Well-being, in that sense, connotes a total, holistic, inside/outside, whole-person state of balanced wellness,” says Bruce.
Jan Bruce, CEO and co-founder of meQuilibrium
What does this mean for marketers?
At the risk of sounding clichè, It means creating products that people want and not trying to glam up products that consumers may find dubious.
Research showsthat 59% of women read beauty product labels to identify harmful ingredients prior to purchase. Sulfates, parabens, and synthetic fragrances top the list of chemicals women want to avoid.
This market shift is causing brands to re-assess and analyze their target audiences. For example, if you are selling collagen enhancement and plumper products to the Kylie Jenner’s of the world, and BB creams and lip stains to the Helen Mirren’s of the world, you need to reflect on your brand communication, product education and community engagement.
However, if Grandma is face-timing her Grandchild and they are both interested in and discussing Renee Zellweger’s alleged eye enhancements, you need to analyze what message you are delivering to which audience (grandma or the 20-something grandchild) and on what platform or channel you are communicating with them.
What does this mean to an agency, to an ecommerce platform, and to a technology partner?
Can we create clear cut personas anymore?
Can we even define targeted demographics and age ranges?
How do we deliver an experience that is inclusive but is also relevant to these newly developing hybrid personas?
A New Digital Approach to Beauty Brand Communication
A recurring theme in the beauty and broader personal care category, is the need for tools to help shoppers navigate.
“Women are overwhelmed with choices. They are exposed to more than 5,000 brand messages every day. Breaking through the clutter and sending the right message at the moment of interest is the only way that emerging and ambitious established brands will be able to succeed in this crowded category,” Andrea Van Dam, CEO of Women’s Marketing warns.
The One Rockwell team recently spoke with Florence Evina-Ze, a Business Strategist and Beauty Blogger, who works with clients, including DevaCurl, on business development, customer experience, and channel growth strategy.
Florence breaks down the notion of holistic consumerism into three digestible areas: Emphasis on ease of use, transparency into ingredients and process, and communication of benefits.
Emphasis on Ease of Use
Evina-Ze says incorporating prevention into your beauty routine has never been easier. For instance, consumers can now find sun protection built into the products they use daily, from Fresh's Sugar Lip Treatment with SPF 15 to sun care based brands such as COOLA whose organic products range from daily moisturizers to makeup setting sprays.
New brands are emerging to meet the needs of different demographics, such as Unsun's sun protection for people of color. Even hair brands are offering products with UV protection to prevent sun damage and provide color protection.
Transparency Into Ingredients and Process
Consumers are becoming more educated about ingredients and their benefits, and companies are now leading their marketing from an ingredient standpoint.
For example, Korean skincare brand, Innisfree has an antioxidant rich line with green tea as the leading ingredient, while Tula highlights the benefits of probiotics in its skin care products promoting "balance from the inside out."
Communication of Benefits
Many companies are taking a holistic approach to beauty, citing multiple benefits that can be derived from just one product. Alterna's Caviar CC cream for hair, for example, evokes the language of skincare marketing and highlights 10 benefits for your hair in one product. Juice Beauty's Stem Cellular CC cream highlights 12 benefits including anti-aging and sun protection.
This trend also ties-in to ease of use by simplifying the number of steps a consumer needs in her beauty routine.
Targeting Savvy Gen Y / Millennials Who Are ‘On the Move’
In March, Lauder launched The Estée Edit by Estée Lauder, a collection of skin-care and cosmetics products aimed at millennial consumers, carried at Sephora. In true millennial form, the face of Lauder, Kendall Jenner, and beauty blogger Irene Kim, selected some of the products in the lineup.
Products that emphasized complexion preparation had the biggest gains, according to NPD. And makeup primers and CC creams alone brought in $490 million to the beauty industry in 2015.
“The consumer is trying to get the benefits, but she’s not locked into using skin care to get the skin-care benefits,” says Karen Grant, global beauty industry analytics at The NPD Group. “The opportunity lies in understanding how to address needs that may be becoming more realized, then [fulfilling] them and [keeping] ahead of the trend. Because she’s moving, we just need to move with her.”
Targeting this consumer is critical: researchers found that 49% of millennial women prefer natural or organic skin care products and intend to purchase them in the future. The goal is finding products with effective yet natural ingredients.
Lucky for Estee Lauder and other brands with a younger audience, millennials are not only the largest generation in America, but according to a 2015 study done by TABS Analytics, women ages 18 to 34 are also the biggest portion of the $13 billion dollar cosmetics market.
In addition, they are more likely to be heavy buyers, meaning they purchase more than 10 types of products a year.
The industry has seen a massive gain in makeup (up 13 percent), primarily due to educational and inspirational content available through instagram and other social channels. Fan favorites are contouring, highlighting and eyebrow tutorials.
Today, thanks to influencers who’ve created a cult following and have evolved their digital brands on social networks like YouTube or Instagram, we are being exposed to beauty in an entirely new way.
A recent survey found that 82% of women believe social media define the beauty market. Marketers are joining this bandwagon by encouraging diverse model selections and endorsing these digital “celebs”.
But how are retail stores shifting to meet the millennial women’s new in-store research needs?
Evolving the Brick and Mortar Shopping Experience
Beauty consumers who are actively researching and trialing products are open to being engaged in new experiences.
We know this target consumer well: she is your “Sephora Saturday sleepy shopper”, combing through the rows, misting her face, and applying argan oil liberally to her split ends on her way home from spin class. She is the woman asking for product, dabbing on a new scent, and committing once she is happy with the results. From there, she is making essentially over 90% of her purchases in store.
Insights in Marketing surveyed more than 2,600 women ages 18 to 67 last fall. It found that prior to brick and mortar shopping, these women prefer to compare products, analyze the reviews, suss out coupons, search for sales, and ensure they have created a shopping list. This traditional boomer behavior is bleeding into the millennial shopping approach.
The way in which women shop appears to be shifting closer towards digital channels and platforms. It is reported that the average store visits per consumer for beauty products fell by 2% in 2014, all while much larger declines in shopping at brick-and-mortar locations happened across top beauty retail channels.
The beauty industry continues to forge ahead. For example, Sephora’s innovative TIP (Teach, Inspire, Play) concept stores offer services and classes that will ensure that the retail experience is personalized and memorable. We can expect other retailers to follow in Sephora’s footsteps, in which brands create destinations for women to learn and engage within the physical brick and mortar space.
According to eMarketer, a poll was done to assess whether internet users were more comfortable purchasing their cosmetics in store versus online.62% of the participants noted concern around color representation of product on screen and would prefer to see the product in person prior to purchasing. This makes us envision other successful “try before you buy” models within other verticals (eg. True and Co. and Warby Parker.)
There is an incredible opportunity for evolving beauty brands. 69% percent of the interviewees state that they would be more likely to purchase first time health or cosmetic products in the physical store, however 88% agreed that the replenishment of these goods could be done offline/online based on the best price offer.
Insights from a report from ATKearney provides wonderful analysis on the demands of a more evolved in-store experience and how brands are stepping up the plate. With an emphasis on effective data capture at the point of sale, we take away the following points to keep of mind while ensuring an effective and unique brand presence.
- Improve brand image and consumer satisfaction
- Guide traffic generated through media
- Generate incremental sales
- Balance product knowledge with service and sales techniques
- Attract customers with appealing store merchandising
- Shelve products by performance and skincare benefits
In the United States, Macy’s, Ulta and Sephora are creating a new standard. Macy's, for example, is targeting a younger consumer with a nod to successful elements of the well known Sephora layouts. We see a similar approach to renovated and newly developed retail establishments such as Urban Outfitters Herald Square and & Other Stories.
CVS Pharmacy's Beauty 360 and Duane Reade's Look Boutique cross the line between traditional drugstore and department store experiences.
How Do These Opportunities Translate to Digital?
According to Larry Promisel, strategic advisor to One Rockwell with past experience working with brands like Barney’s, Coach, and Bloomingdales,
“Research, education, social media, and videos are all adding to consumers’ experience, both in-store and online, thus influencing purchase decisions,” he says. “Shoppers have become empowered to discover useful, relevant products offered by guided selling, neural networks, and analytical tools.
Technology, including diagnostic tools and apps that analyze skin conditions and facial recognition of eyes and hair, further suggest selling techniques and are evolving quickly. These tools must be coordinated with additional proven digital mechanisms such as product recommendations, cross-selling, social listening, ratings and reviews. Social media sharing will further build the relationship and engagement.”
Below, we’ve summarized what tools and products you might want to consider to ensure an ideal customer experience across target demographics.
Automated Replenishment for the Millennial Consumer
Automated Replenishment offers wonderful simplification for mundane purchasing.
To cater to millennials, who are programmed to believe life can be simplified by a touch of a button (e.g. using Seamless, Class Pass, Beauty Pass, Uber, Task Rabbit, Amazon Prime Now), the beauty industry continues to simplify the last-minute nuances of purchasing products like sunscreen (heaven forbid!).
While automated replenishment can impact business operations and increase technical complexities through product expiration dates, typical cadence of product usage by person, tokenization of credit card information, and more, we look for smart solutions in the space that can take advanced business logics and simplify them.
Fan Favorite product: nChannel
Bundled Items for the Product Researcher
Bundled Items are god’s gift to the industry. They are phenomenal when looking to increase cart conversion, communicate regiments or product processes, and cross category education for a loyal consumer. We recommend upselling with beauty basics (e.g. cleanser and toner, shampoo and conditioner, lip liner and lipstick).
When brands need support in communicating bundles cross-channel, or providing user-generated content to support the validity of a product cross-sell, they look to reliable product reviews and within the space.
Fan Favorite product: Olapic
Product Recommendations for the Brick and Mortar Shopper
To convince a traditional brick and mortar shopper that her online experience will be more curated and effective than engaging with a disgruntled sales girl waiting for her cigarette break, a brand’s product recommendations need to be targeted and relevant.
Retailers who complete a look based on past purchases, or retailers who effectively recommend a particular bra for an off the shoulder blouse will immediately have greater success than a sales representatives who upsells based on random logic. Same applies for digital upselling.Fan Favorite product: Shopify Plus App LimeSpot
In order to deliver relevant products to the end user, brands need to put energy into effective communication by telling the right message, at the right time, and to the right channel. By syncing communication with smart data capture, brands can deliver a holistic and effective message.
Fan Favorite product: Listrak
It is an exciting time to be a witness to this evolving market. With accessible technical solutions, an overly connected consumer, and an opportunity for innovation, the beauty industry has just begun its venture into communicating brand ethos and product usage to an eager clientele.
We leave you with three goals as you evolve your digital roadmap: Educate, Inspire and Connect.
About the Agency
One Rockwell is a full-service digital agency with exceptional abilities in intelligent commerce. With Clients such as Oscar de la Renta, Mara Hoffman, and Juice Beauty, One Rockwell is a true digital destination for serious brands looking for serious growth. Contributions by One Rockwell strategists and advisors: Larry Promisel, Heather Nigro, Florence Evina-Ze and Colleen Oates.
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