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Estée Lauder and L’Oréal are the cream of the digital crop

By Andrew MCDOUGALL , 02-Nov-2012
Last updated on 03-May-2013 at 09:54 GMT

Estée Lauder and L’Oréal are the cream of the digital crop

Estée Lauder and L’Oréal have shown their digital dominance as their brands topped the fourth annual 2012 Digital IQ Index for beauty firms.

The Estée Lauder and Lancome brands tied at number one, whilst L’Oréal Paris, Clinique, and MAC Cosmetics (the latter two being Estée Lauder brands) make up the remaining top five spots as ‘Gifted’ brands in the Index.

The study, authored by Scott Galloway, New York University Stern Clinical Professor of Marketing, and a team of researchers at L2 Think Tank, benchmarks the digital competence of 56 prestige beauty brands.

Digital trend

The 56 prestige beauty brands were evaluated on more than 900 data points across four dimensions: Site, Digital Marketing, Social Media, and Mobile.

The last few years has seen many cosmetic companies ramp up their digital efforts, notably Estée Lauder and L’Oréal, and study author Galloway believes this will continue to be the trend in the future.

“Beauty brands want out of the suicide pact signed decades ago with traditional broadcast and department stores that are losing effectiveness and sales, respectively,” he said.

“Digital marketing and e-commerce are enabling the sector’s most charismatic brands to establish direct relationships with the end consumer.”

Study findings

The study also found that nearly half of the 56 brands in the Index now register internet marketplace Amazon as a top source of downstream traffic from their sites, up from 36 per cent a year ago.

While Facebook remains the largest source of referral traffic for beauty brands in the study, year-over-year analysis suggests that its influence is waning. Upstream traffic from YouTube has doubled and is now a top eight source of traffic for 41 per cent of brands.

Competition for e-commerce sales is evident across the industry: 75 per cent of brands in the study now incorporate user reviews, 39 per cent support auto-replenish sites and 18 per cent have introduced ongoing loyalty programs.

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