Table of Contents
Executive Summary
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- Market overview
- Top takeaways
- Top purchases signal shifting interests and underserved consumers
- Category experts face stiff competition
- Younger consumers are more considerate of environmental impact
- The issues
- Mass merchandisers and Amazon threaten beauty retailers’ share
- Multicultural consumers are overlooked
- The opportunities
- Carefully curated products and guidance will keep more beauty shoppers engaged
- Tailoring approach, assortment and marketing will benefit retailers and shoppers
- What it means/what’s next
The Market – What You Need to Know
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- Sales are stable, but interests are shifting
- Beauty retailers are losing share
- Beauty consumers have varied needs and interests to be addressed
Market Size and Forecast
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- Growth remains stable, but product interest shifts
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- Figure 1: Total US sales and fan chart forecast of beauty products, at current prices, 2014-24
- Figure 2: Total US sales and forecast of beauty products, at current prices, 2014-24
Market Breakdown
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- Mass merchandisers capture majority of sales
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- Figure 3: Distribution of sales of beauty and personal care products, by retail channel, 2017
Market Factors
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- Men can help drive future growth
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- Figure 4: Population, by gender and age, 2014-24
- Multicultural consumers may be underserved
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- Figure 5: Population by race and Hispanic origin, 2014-24
- Younger generations have new priorities and ways of engaging
Key Players – What You Need to Know
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- Familiar favorites are most preferred, but digitally native brands resonate with young shoppers
- Mass merchandisers’ beauty innovations are winning with shoppers
- An overcrowded market signals potential softness
- Clean beauty is more than a trend
Preferred Brands
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- Women have mutual appreciation for value brands, but interest in higher-end or emerging brands varies with age
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- Figure 6: Preferred brands, July 2019
- Maybe it’s Maybelline, from NYFW and beyond
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- Figure 7: NYC-themed makeup palettes on display at Maybelline House NYFW event, September 2019
- Figure 8: Limited-edition lip kit on display at Maybelline House NYFW event, September 2019
- Easy, breezy beautiful in brick-and-mortar
- Multicultural women favor select prestige and private brands
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- Figure 9: Preferred brands, by race and Hispanic origin, July 2019
- Gen Zs seek trendy products from young brands
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- Figure 10: Preferred brands, by generation, July 2019
What’s Working?
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- Beauty disruptors, according to Allure
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- Figure 11: Allure Instagram post, September 2019
- Target and Walmart bring new, clean beauty options to the masses
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- Figure 12: Target Style Instagram post, May 2019
- Figure 13: Target Style Instagram post, May 2019
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- Figure 14: Walmart Instagram post, September 2019
- Drug stores and DTC brands partner to reach new customers
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- Figure 15: Birchbox in Walgreens, May 2019
- Figure 16: Birchbox in Walgreens, May 2019
What’s Struggling?
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- Color cosmetics face growth challenges
- Is the beauty boom about to bust?
What to Watch
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- CBD and clean beauty are more than just buzz words
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- Figure 17: Sephora Instagram post, August 2019
- Figure 18: Beboe Instagram post, March 2019
- Designer beauty is making a comeback
The Consumer – What You Need to Know
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- High-usage essentials are top purchases, but some needs are unmet
- Category experts face threat from big-box retailers
- Beauty shopping is a multichannel process
- Beauty shoppers change as they mature and express different priorities
Items Purchased
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- Analyst perspective:
- Hair and body products are most purchased
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- Figure 19: Items purchased, July 2019
- Opportunity to drive basket sizes with young adults and less-purchased items
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- Figure 20: Items purchased, by gender and age, July 2019
- Black consumers have different beauty priorities, and might be underserved
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- Figure 21: Items purchased, by race, July 2019
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- Figure 22: Pattern Instagram post, September 2019
- Figure 23: SheaMoisture: Break the Walls commercial, April 2016
Retailers Shopped
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- Analyst perspective:
- Specialty and department stores face competition from mass, grocery and drug stores
- In-store
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- Figure 24: Retailers shopped – In-store, July 2019
- Online
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- Figure 25: Glossier Instagram post, March 2019
- Figure 26: Amazon Instagram post, September 2019
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- Figure 27: Retailers shopped – Online, July 2019
- Beauty retailers are missing sales opportunities with men
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- Figure 28: Retailers shopped, by gender and age, July 2019
- Amazon stealing share among families
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- Figure 29: Retailers shopped – NET, by parental status, July 2019
Shopping Method
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- Analyst perspective:
- Specialty beauty stores are losing to competitors, in stores and online
- In-store
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- Figure 30: Shopping method – In-store (NET), July 2019
- Online
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- Figure 31: Shopping method – Online (NET), July 2019
Trip Mission and Method
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- Analyst perspective:
- Initial purchases and special situations are bought in-store, while online is reserved for replenishing, splurging or browsing
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- Figure 32: Trip mission and method of purchasing, July 2019
- Older shoppers seek in-store assistance for risky purchases
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- Figure 33: Trip mission and method – In-store, by select demographics, July 2019
- Social media elicits certain purchases, particularly among young men
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- Figure 34: Trip mission and method – Through social media, by gender and age, July 2019
- Online presence is crucial for converting Black beauty shoppers
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- Figure 35: Trip mission and method (NET any online method), by race and Hispanic origin, July 2019
Pre-purchase Process
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- Analyst perspective:
- Beauty shoppers’ path to purchase goes on and offline
- The in-store experience is pivotal to most shoppers’ purchase journeys
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- Figure 36: Pre-purchase process, July 2019
- Gen Z and Millennials are considerate, thoughtful shoppers
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- Figure 37: Pre-purchase process, by generation, July 2019
- Suggestions, feedback and instructional content will connect with multicultural shoppers
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- Figure 38: Pre-purchase process, by race and Hispanic origin, July 2019
Purchase Considerations
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- Analyst perspective:
- Most shop with a “price first, brand second” mentality
- Price
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- Figure 39: Purchase considerations – Price, by select demographics, July 2019
- Brand
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- Figure 40: Purchase considerations – Brand, by select demographics, July 2019
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- Figure 41: Outdoor Voices Instagram post, August 2019
- Ingredients
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- Figure 42: Purchase considerations – Ingredients, by select demographics, July 2019
- Younger generations prioritize environmental impact and packaging
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- Figure 43: Purchase considerations, by generation, July 2019
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- Figure 44: Glossier Instagram post, May 2018
Types of Shoppers
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- Key takeaways/analyst POV:
- Two types: established, routine beauties and experimental enthusiasts
- Routine beauties offer loyalty but create engagement challenges
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- Figure 45: Types of shoppers, July 2019
- Experimental young adults present incremental sales opportunities
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- Figure 46: Types of shoppers, by gender and age, July 2019
- Multicultural consumers have fun with beauty and seek expert opinion
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Consumer qualitative research
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
Appendix – The Market
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- Figure 47: Total US sales and forecast of beauty products, at inflation-adjusted prices, 2014-24
- Figure 48: Total US retail sales and forecast of beauty products, by segment, at current prices, 2014-24
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Appendix – The Consumer
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- Figure 49: Items purchased, by gender and age, July 2019
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