The beauty industry, including personal care products, skincare, color cosmetics, and fragrances, is a 500 billion dollar industry.1 While COVID-19 has impacted almost every economic sector, beauty has shown resilience in times of crisis, and according to some analysts, increase sales during recessions.2 While online sales have gotten more traction, there is still value in going to the mall when shopping for beauty products.
A symbol of consumerism, malls are a mainstay of American culture and a place where everyone congregates. Long before COVID-19, however, malls were trending down.3 The traditional box mall that featured megastores like Sears and J.C. Penney as their main attraction is quickly going the way of the dinosaur.4 Online shopping is so entrenched today that it’s easy to forget that the infrastructures required for online shopping, like Amazon, eBay, online banking, and the like, have only been around for 25 years.
For consumers, online shopping offers convenience, better price comparisons, online reviews, and 24-hour shopping. For retailers, an online platform saves on rent, and in many cases, saves on staffing cost. To be competitive, physical stores need to offer something unique because online shopping can provide filters, reviews and have much less friction today.
Online shopping presents a challenge to businesses that need to carry inventory; rent isn’t cheap. Amazon has been aggressively expanding and accounted for over 40% of total retail e-commerce in the beauty sector in 2017.5 Online shopping has many other advantages such as lower operating costs, efficient storage, and inventory management. Large companies like Amazon have perfected this. At the other end of the scale are customized or personalized items, such as clothing and beauty products which are much more personalized.
Online shopping advantages
- 24/7 availability, shop from home or on the go
- 24/7 access to customer reviews
- Access to a wider selection of brands and products
- Competitive marketplace with many deals and discounts
- Lack of swatching and human to human interaction
Online shopping disadvantages
- Lack of testing – you can’t swatch make-up
- No personalized advice from beauty counter clerks
- Unexpected overspending
- Waiting period for the order to arrive
Skincare and the Beauty Market
In-store shopping is still mainstream in the beauty sector. While there is a predictable generational divide, even GenZers (1998-2010) enjoy making beauty product purchases in physical stores. In some cases, this is more true of digital natives than the older shoppers.6 There are upsides to both online and in-store retail shopping. In practice, regardless of age group, consumers are hybrid shoppers, getting the best of both worlds.
Do Your Research Online
Large stores like Sephora, Target, Ulta, and the department stores will provide you with plenty of brands and beauty options, but storefronts are limited by square footage.
Unfortunately, testing/swatching is not an option due to COVID-19 in most North American stores. Salespeople are not always unbiased sources of opinions. Before the Internet, beauty information that was objective and tailored to benefit the consumer was nearly non-existent. Paula Begoun made her name by providing information that would help the consumer when nobody else did.
Online reviews have revolutionized shopping, with consumers now holding far more sway and influence than ever. Consumers rightly trust other consumers over legacy marketing and advertisements.
Storefronts still offer unique value
Try it on! Whether it’s mascara or a pair of shoes, sometimes you have to try it, and you can’t replicate that experience online. COVID-19 protocol puts a damper on testing and swatching beauty products today, but once the virus is under control, this practice will likely resume. Malls may not be what it once was, but spending begets spending. Physical shopping is still a package experience – an activity rather than a chore and associated with a positive experience.
Online shopping for cosmetics is here to stay, but so is in-store. In-store shopping still offers a unique and positive experience despite COVID-19, and with vaccinations coming in, the outlook is bright. If you only shop online or in stores, consider expanding your horizons.
1https://www.mckinsey.com/industries
2https://www.reuters.com/article/us-beauty-sales-recession
3https://www.cnbc.com/2019/04/15/malls-see-tsunami-of-store-closures-as-foot-traffic-declines-further.html
4https://www.washingtonpost.com/business/2019/11/22/malls-are-dying-only-these-ones-have-figured-out-secrets-success-internet-age/
5https://www.emarketer.com/content/amazon-s-health-and-beauty-sales-soar
6How Each Generation Shops in 2020 – Salesfloor
