In-cosmetics Virtual 2020, a new online event designed to keep the personal care industry connected, is happening from October 6 – 8.
It’s a great way for cosmetic and contract manufacturers, private labels, indie brands, fragrance houses and manipulation pharmacies to network with personal care professionals, see what new ingredients are launched to market, and stay up-to-date with the latest marketing trends.
esprit caught up with Povilas Sugintas, beauty and fashion consultant, Euromonitor International, ahead of the event, who shared with us his thoughts on how COVID-19 is changing the landscape of the beauty and personal care retailing of today and tomorrow.
What have been the biggest changes in beauty retail this year?
Temporary store closures have been and remain the biggest challenge. For all the talk about internet retailing, it still only accounts for 11% globally and e-commerce will not be able to fully cushion the blow and replace the loss in physical retail. Considering consumers’ heightened health and safety concerns means retailers will need to reinvent in-store experiences to reduce anxiety about physical shopping. This will include initiatives around contactless payments, curbside pick-up and novel ways of product sampling. Home seclusion also means dampened demand for discretionary items such as colour cosmetics and fragrances, which means lower footfall in beauty specialist outlets, despite certain shifts to digital purchasing.
Finding positives is harder but includes the growing e-commerce market, which is driven by shoppable social media and live streaming. This gives companies a pretty clear idea of what future retailing is going to look like.
How have consumers changed their buying/shopping habits?
By far the biggest consumption change is soaring online sales. According to Voice of the Industry survey fielded in July by Euromonitor International, 64% of companies believe this to be a permanent shift, putting those companies with pre-pandemic investments in e-commerce in a more advantageous position. Not many companies were prepared for this, which resulted in product shortages worldwide. Product-wise, now more than ever shoppers prioritise ingredient transparency and safety. All things related to immunity are doing well. Also, with 70% of global respondents reporting increased anxiety, mental health will be a key area for beauty companies to reposition their product offerings and embed emotional support either through marketing, ingredient formulation or community building.
What has remained constant throughout the pandemic in retail?
Grocery outlets and convenience stores continued performing well during the pandemic, as they have not experienced as many prolonged store closures in comparison to beauty specialist retailers. With primarily mass offerings on their shelves, grocery retailers and convenience stores should continue to do well in the near term. Also, a shift to digital platforms continued and even accelerated. Consumers are now being offered virtual guidance, advice and tutorials to drive shopping.
Buying beauty is such a sensory experience – how will people still be able to buy without feeling, trying or smelling the product?
That’s one of the many challenges for the industry now. Technologies such as AR or VR seem to be an answer for now, partially solving the visual part of trialling products like make-up. This is illustrated by L’Oréal giving a try to its app at London’s Heathrow Airport to assuage any concerns consumers may have. Subscription-based selling is also a viable option, with a shipment of samples along with replenishing items. The hardest category to move online or to contactless shopping remains fragrances for a simple reason that there’s no technology yet to replicate the olfactory experience. On a positive side, the investment made now will bear fruit for many years to come as sales were moving online anyway.
What does the future of beauty retail look like?
57% of global consumers were purchasing beauty, health and personal care products in person at the store, as per Euromonitor’s Digital Consumer Survey 2020. Physical retailing won’t go away but will have to be re-strategised. A “wow” in-store effect is now a must, which probably means we’ll have less, but more impactful outlets. Premium brands will seek to expand their reach and will likely be seen in stores like Walmart and Target, not to mention Amazon.
Reaching consumers will pose a challenge, as traditional media that was relied on for years is crumbling right before our eyes, giving way to social media. Companies will adjust accordingly, either by using influencers or becoming content creators themselves.
Lastly, even if omnichannel sounds like a tired word by now, I’m sure we’ll hear more of it. The search for the right balance and synergy between physical and digital presence will define the next few years.
Povilas Sugintas, Beauty and Fashion Consultant, Euromonitor International will lead a session at in-cosmetics Virtual on ‘Beauty and personal care retailing of today and tomorrow: How COVID-19 is changing the landscape’ on Tuesday, October 6 at 13:30.
For more information and to register to attend in-cosmetics Virtual 2020, visit: www.in-cosmetics.com/virtual