The beauty industry had a record year in 2018, with 10. 2018 was a perfect 10. Both big brands (including Olay and L’Oreal) reported record sales growth. This continues the trend of 2017. Fenty Beauty and Kylie Cosmetics were the latest names to catch attention and are gaining popularity on social media. This is in continuation of the trend from 2017. Companies from all sectors are trying to get in on the action. What’s the biggest challenge to this bustling industry?
Omnichannel retail, naturally.
This word was thought to have been retired due to overuse (like a sweater that you love to death), but it is now having a second life. Omnichannel retail has become a necessity. According to Glossy market research, a large number of digitally native DTC cosmetic brands intend to sell wholesale to their customers as part of an integrated omnichannel approach in 2019.
“We are moving away from digital versus physical retail and towards onechannel, the consumer channel,” stated Stephanie Cegielski (a spokesperson for International Council of Shopping Centers).
Sephora sets the bar for omnichannel retail excellence
Sephora is an excellent example of the omnichannel push at work. The brand is successfully combining in-store tech and online capabilities, as well as a revamped in-store experience that is customer-focused, capturing customers’ attention from all angles.
Mary Beth Laughton (senior vice president of digital at Sephora) stated that “we want to be there our clients are” and that they use their phones for a variety of purposes, including shopping and learning. “She doesn’t have to choose between a Sephora shop or mobile. They complement each other, and all of the tools that we’ve built support that theory.”
Sephora laid the groundwork for an omnichannel strategy years ago. Some estimates even suggest that the strategy helped Sephora survive the retail apocalypse. Sephora’s slow, but steady approach to omnichannel is not the only one that brands follow.
Know your customer
Take a look at how Glossier is moving. Glossier was founded in 2014. Its millennial-pink color scheme, commitment to minimalism, and focus on simplicity attracted shoppers’ attention right from the beginning. However, as an e-commerce brand that sells direct-to-consumer products, it lost potential in-store sales. Glossier’s flagship store opened in NYC in 2018. The brand’s online identity was brought to life in the physical retail store, which allows for seamless digital and in-store transitions. The store’s every corner is Instagrammable. From the colorful, sculptural display cases and plush sofas to the large mirror room stocked with larger-than-life Glossier cosmetic tubes, all corners are easily captured.
Glossier may be offline but they are still focusing on e-commerce. Why the flagship? Company CEO Emily Weiss views the brick-and mortar move as an opportunity to offer brand loyalists an unforgettable experience.
Weiss compared the store to an adult Disneyland.
Glossier’s success may not be replicated by other brands.
All omnichannel retail channels are not created equal
“A seamless Omnichannel Experience is not just about being frictionless. It’s also about knowing your customer better and delivering an experience that’s right every time.” Stephanie Wissink, a Jefferies equity analyst, says.
Many companies from different industries are looking to get into beauty. They will need to think about how to provide a multi-channel experience that’s not only interesting but also highly personalized to their specific audience. Brands will also need to ensure that their strategies are shared across all products and offerings.
CoverGirl. In NYC, CoverGirl opened its first direct to-consumer shop last year. It is modern and sleek, with high-tech features such as AI-powered assistants or virtual try-on mirrors. CoverGirl has also changed their message and packaging. Ukonwa Olojo, senior vice president at CoverGirl said that the changes are part a wider effort to make CoverGirl more than just makeup. Ojo stated that they hope to create a provocative dialog that challenges cultural assumptions about makeup and how it is worn.
This is interesting but it may seem confusing to existing customers who have worn Cover Girl makeup for many years. The result is far from Glossier’s fairytale escape. Is the space able to offer an omnichannel shopping experience that combines innovative technology with shopping? Yes. But is it really on-brand? It is not necessarily on-brand. To our eyes, it hasn’t become a must-visit place or received as much media attention as Glossier. Glossier uses physical retail to enhance their online brand in an easy and seamless way. Cover Girl is the opposite, with a brand new flagship store where new products and positioning are being tested. The former approach appears to be gaining more traction in the beauty market.
In 2019, omnichannel will continue dominating the strategies of beauty retailers. It is clear that technology alone will not be enough to win a brand. Customers want a shopping experience that goes beyond touch screens and keyboards. Customers also desire to have memorable, hands-on, sensory-embracing, shared-able in-store shoppers moments(r).