The Changing State of Beauty & Cosmetics
Over the last 15 years, the global beauty industry has consistently grown and now accounts for yearly sales in excess of $500 billion.
Even during times of recession, losses in the category were relatively small, and the industry had been quick to rebound. But the current pandemic is unlike anything the industry has ever seen.
According to a report by McKinsey and company, global beauty industry revenues could still fall 20 to 30 percent in 2020.
Still, the pandemic has ushered in new behaviors and accelerated the rate of digital transformation and innovation. Prior to worldwide shutdowns, up to 85% of cosmetics & beauty purchases were made in-store. Yet, 36% of consumers purchased beauty products online for the first time during the pandemic, and 73% said they would continue to do so.
These uncharted waters and uncertain times call for a delicate balance between agile pragmatism and bold decisions. To have a strong position in the future, beauty and cosmetics brands will require strategic clarity, a deeper understanding of how consumers are shopping, laser-focus on where to invest and when, and a broader transformation that incorporates technology, people, and purpose.
Eshopworld has seen over 100% growth in order Volume year-over-year for several consecutive months.
Adjusting to the New Normal
Beauty products sales are shifting online.
Evolving Beauty’s Retail Experience
The pandemic forced the closure of many retail stores. Some stores will not survive, but even those that do may start to look very different, as customers gain comfort and confidence in their online shopping experience. It’s expected that stores will become hubs for experience and fulfillment. In the digital era, the store can be a unique environment where brands can curate every element of the customer experience and create meaningful, in-person relationships.
In the short-term, stores will service as fulfilment centers to bridge online and offline worlds. The majority of shoppers have taken advantage of this in three ways:
The research shows that now is the right time for beauty and cosmetics brands to open Click & Collect channels. While many places begin to take steps to reopen physical locations, 62% of global shoppers claimed they would require social distancing measures to be in place before they return to a store. Click & Collect can help this demographic ease back into the physical shopping experience.
BENEFITS OF CLICK & COLLECT:
Investing in D2C
With many retail partners and wholesalers on shaky ground and the lack of control marketplaces provide, investment in D2C is more essential than ever.
What Do Beauty Brands Do Now?
If you’ve already been thinking about expanding your D2C and cross-border e-commerce channels, the next thing you might be wondering is, “Should I build this out in-house or partner with a vendor?
How We Do It
ESW is the leading cross-border technology and services partner chosen by the world’s best-loved apparel, beauty, footwear, and luxury brands to power their international expansion.
Want to talk about global expansion? Contact us.