Integrating multi-channel distribution leads to success for beauty brands

Each distribution channel is distinctive. These distinctive channels are important as consumers respond to distinctive stimulus from a variety channels at different times. Moreover, if beauty brands are not available at a convenient distribution point while the consumer is likely to purchase, the brand risks being substituted by another more convenient product.

This is especially true as consumers often choose convenience over brands. It is common for consumers to spend about 12 seconds choosing a beauty brand at the store that they have chosen to shop. The store selection is often influenced by convenience, overall image or location, which often often leads to consumers spending more time choosing the store than the brand itself.

The Internet continues to play an important role in multi-channel distribution as more than 45 percent of the United States population either shop or use a research tool on the Internet before they purchase. Consequently, consumers who shop across a number of channels—physical stores, the Internet, and catalogs—spend about four times more annually than those who shop in just one channel.

Getting multi-channel retailing right​

This means that cosmetic companies that get multi-channel retailing right, can invariably enjoy larger profit margins and more yearly revenue growth than single channel brands.

Consumer demand does drive distribution according to Tonie Shin, Vice president of marketing at NYX, Los Angeles: “Cosmetics are a very tactile product which people want to feel and see before they purchase. ​

“Although our sales our high online, people still want it in their closest retail outlet and they want a large assortment. We have received requests to be carried in their local drug and beauty store as well as major retail outlets such as Target, Duane Reade, as well as our own stores.” ​

This means that if the brand is not found in multiple channels of distribution it may be loosing sales and potential revenue and most importantly customers.

Opportunities for emerging brands​

Lisa Adams, founder and creative director of The Beauty Matchmakers, a company, which helps brands increase their retail doors and ultimately their distribution explains: “Trend and multiple channels of distribution offer the opportunity to our emerging ‘indie’ brands to develop a competitive advantage not just for the brand itself but for the retailer. While brick and mortar establishments are well-versed for their household beauty brands… in today’s ever changing economic climate the importance of emerging brands to be seen in multiple channels of distribution is important.”​

Successful distribution goes beyond e-commerce and brick and mortar stores to catalog, direct to consumer and recently social media platforms. A portion of social media that could be described as a distribution channel is often called f-commerce since sales come directly from facebook.

Recently Covergirl asked viewers to log in at facebook.com/covergirl to receive free samples. These kind of interactive social media brands offer the best chance of a loyal customer base and additional sales. Some brands now even have products that are available to purchase on facebook and/or facebook exclusives.

Facebook 'critical' to connect with customers​

Shin, notes that: “As a private brand, our Facebook page has always been a critical outlet to connect with customers. It has been my goal since the inception of social media platforms to connect, communicate, and share NYX’s products as well as the brand.”​

Shin’s commitment is apparent, as NYX has recently launched a facebook store with limited promotions as well as its commitment to continue to develop a strong vlogger (video bloggers) network.

Additionally, Adams stresses “Facebook is another way that brands can be in the right place at the right time with value for consumer”. ​

These social media strategies can be extremely successful with tech savvy Millennials who are extremely interested in connecting with the brands. These Millennials are not just interested in hearing what the brands have to say but they prefer having two-way communication with their brands.

Building on brand loyalty​

This strengthens the brand loyalty and if the option to purchase is available while the conversation is happening then there will be additional success for brands in multi-channel distribution.

The challenge is that while making sales through a multi channel retailing seems easy enough, sustainable growth and a good profit margin require an integrated strategy across all channels, including physical stores, catalogs, the Internet, and mobile.

Long gone are the days where a beauty brand is only found in one distribution channel.