E-commerce sales have accelerated over retail sales during the pandemic
TheCOVID-19 pandemic, has accelerated the shift to buying cosmetics, skincare and other luxury products online, and a growing number of sales are now via a smartphone rather than over the counter. As a result, manicured sales assistants, testing pots and makeovers are being replaced by powerful influencers and digital beauty halls that can switch up the products on offer at the tweak of an algorithm.
The established beauty majors like L’Oréal, Clarins and Mac that have traditionally dominated the market, now face heavy competition from a plethora of upstarts, which can quickly rise and fall on waves of social media interest. A succession of buyouts and joint ventures with celebrities, influencers and online sellers is creating a new generation of cosmetics millionaires, and in some cases, billionaires.
Earlier this week, Forbes magazine declared the singer Rihanna a billionaire, after placing a US$ 2.8billion value on her Fenty Beauty cosmetics empire. One of the most successful performers of her generation, Rihanna’s sideline business has become her most valuable. She owns 50% of Fenty, which has already achieved sales of $550m since its launch in 2017.
Kylie Jenner, the youngest member of the Kardashian-Jenner reality-TV family, became the world’s youngest billionaire in 2019 at 21 thanks to the success of Kylie Cosmetics, the makeup company which was bought out by the global beauty company Coty.
Changes were afoot well before Covid-19 emerged, but the pandemic has accelerated existing trends as women, and men, were forced to rethink their routines and purchasing patterns by repeated high street lockdowns and the shift to spending time at home. Meanwhile, the shutdown of most international travel has hit the once mighty duty-free trade, again increasing the importance of online sellers.
Samantha Dover, a global beauty analyst at the market research group Mintel, explained this change as a turning point in an industry that has historically been heavily reliant on store-based spending. And as per market reports by consultancy, McKinsey & Company, in the longer term, beauty was likely to follow other categories such as fashion in shifting even further online. The report also mentions as much as half of all sales could eventually come via a phone or laptop.