Millennial buying power is set to transform the beauty business

By Deanna Utroske contact

- Last updated on GMT

Millennial buying power is set to transform the beauty business

Related tags: Cosmetics

As the largest generation ever, Millennials’ spending will reach $2.5 trillion dollars in 5 years and the new Women 2020 study from Meredith Corporation highlights what that means for personal care and cosmetics brands.

The study also sheds light on the generation’s relationship with social media (80% use a smartphone), who they identify as celebrity role models (Ellen Degeneres and Michelle Obama), and their optimism about the future (75% think they will be happier in 2020).

Meredith Corporation partnered with marketing consultancy Insights in Marketing on the study. That firm gathered data last October by conducting an online survey with over 2,500 women, ranging in age from 18 to 67.

The price of beauty
The Women 2020 study found that more women in the Millennial generation say that looking beautiful is important than women in the Baby Boomer generation.

Good news for the beauty industry though, in both age groups a majority of women affirms that it is important to look beautiful:  73% of Millennials compared to 57% of Baby Boomers.

The price of a personal care or cosmetic product is more likely to influence a purchase among the younger women, according to this study. “Price is a purchase driver,” ​asserts Meredith. “60% of Millennials buy based on price while only 38% of Boomers consider it.”

It’s not clear from the results that Meredith shared with the press, though, just how each group is using price to make purchasing decisions. Those numbers may mean that lower priced items sell better with Millennials. It’s just as likely that as a group, Millennial women are using price point as a metric by which to gauge the quality of product.

Under the influence
Research continues to show that consumers trust the word of a professional or peer when it comes to buying beauty. A recent academic study on cosmetics ads in women’s print magazines found that, “advertising claims that make use of endorsers, like dermatologists, performed best,” reported Cosmetics Design​. Product superiority claims, ads with clinical evaluation results, and those with subjective language didn’t fare so well.

Meredith’s Women 2020 study found that a significant percentage of Millennial women both “trust influencer recommendations and share their own reviews.” ​The report shows that 75% try beauty products based on a recommendation and that 55% frequently make product recommendations to others.

Social, mobile, natural
Millennials are of course also known for being social, mobile and into natural looks when it comes to beauty. Agile brands, like Nudestix are meeting these consumers on their own terms.  

The indie brand, launched last May, has a good handle on the Millennial consumer journey and sees color cosmetics as an accessory: “Beauty must fit into our clients lifestyle and not be disruptive or complicated…applying a lipstick is an accessory to the overall look just as earrings would be,” ​Jenny Frankel, Nudestix founder and CEO told Cosmetics Design​ late last month.

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