Experiential beauty retail is winning with consumers, shows Kline data
Beauty brands are continuously adapting to the preferences and realities of people and retail in the digital age. Brick-and-mortar is not dead; direct sales is not dead; but today’s shoppers are looking for dynamic, engaging experiences in the omnichannel beauty marketplace.
Kline data shows that direct sales (ecommerce, social selling, home shopping) is up 13% and beauty at specialty stores is up 9%. In fact, "these two channels combined account for an estimated almost one-third of total beauty sales," according to a press release about the firm’s newly published report on US beauty retail.
“Traditional department stores, in a quest to reverse declining sales and attract the younger generation of experimental consumers, are transitioning to become more competitive with e-commerce by employing more technology,” explains Donna Barson, senior consultant at Kline, in the release.
“However,” she says, “it is specialty retailers that are at the forefront of the retailing changes, attracting consumers by developing more engaging formats and more personalized customer experience.”
A trend in the making
Experiential retail has been an advancing for years now; and as Cosmetics Design predicted in this 2015 video, “experiential retail not only [ensures] that every touchpoint is a possible point of sale but that every touchpoint is a destination the shopper’s journey wouldn’t be complete without.”
Today, avid beauty shoppers certainly do seek out dynamic, sharable experiences, which explains why both conventional retailers and digital-first brands are expanding beyond their native platforms.
“The retailers on both sides are now adapting,” comments Barson. “Traditional retailers," she notes, “are utilizing more in-store technologies while once online-only exclusives, such as Glossier and KKW Beauty, are establishing pop-up or permanent brick-and-mortar retail stores, to have a better dialogue with customers.”
No end in sight
Legacy brands like Unilever’s St. Ives and Coty’s Cover Girl are updating their approach to retail as well. St. Ives opened its second annual skin care mixing bar pop-up in New York City this month. And the 2018 iteration includes an online pop-up too—making the venture both personal and digital.
“As a brand, we are always looking for new ways to engage with our consumers,” Suzanne Palentchar, director of marketing for the brand told the press. “In response to their feedback from last summer, we are excited to open an online direct-to-consumer extension of the store to bring the same custom experience of the store to fans nationwide,” she said.
Additionally, as part of the ongoing reinvention of the Cover Girl brand, Coty partnered with the concept shop Story on an interactive beauty retail experience late last year.
Kline’s report points to conventional retailers like Macy’s and Nordstrom that are investing in pop-up and concept-shop retail as a part of this shift as well.
And “Multibrand cosmetic specialty stores show rapid growth during 2017 due to the continuing opening of new locations by Ulta and Bluemercury, with new formats such as The Sephora Studio which focuses on a curated assortment along with services, and with Forever 21’s Riley Rose, which concentrates on millennial-skewed brands that are hard to find in physical stores,” according to the firm’s press release.
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Deanna Utroske, CosmeticsDesign.com Editor, covers beauty business news in the Americas region and publishes the weekly Indie Beauty Profile column, showcasing the inspiring work of entrepreneurs and innovative brands.
