Beauty and the Online Landscape - US - December 2019

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
Market overview
Top takeaways
Online activity is integral to the path to purchase
A mix of informative and inspirational content will engage more consumers
Beauty consumers want simple reassurances in order to increase online shopping
Key trends
Social media becomes a source of commerce
Video gets prioritized in social strategies
What it means/what’s next
THE MARKET – WHAT YOU NEED TO KNOW
Online beauty has evolved past transacting
Younger shoppers’ have differing preferences
MARKET PERSPECTIVE
Category Evolution
MARKET FACTORS 
Gen Z’s beauty interests will influence product development and shopping expectations
Figure 1: Population, by generation, 2024 projections
Diversity of younger consumers leads to demand for broader beauty representation
Figure 2: Generations, by race and Hispanic origin, 2019
Young men can help drive growth
Figure 3: Men aged 18 or older, by age, 2014-24
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Social media becomes a natural part of consumers’ shopping journey
Endless space means room for overlooked consumers
Virtual reality will be more than a perk
WHAT’S WORKING
Social media as a destination for discovery and exploration, not just for consumers
Figure 4: Kohl’s Instagram post, November 2019
Figure 5: Ulta Instagram post, November 2019
Re-thinking consumer marketing in the digital age
Figure 6: Goop Instagram post, November 2019
Making online beauty shopping personal
Figure 7: Prose Instagram post, October 2019
Figure 8: Atolla Instagram post, October 2019
WHAT’S STRUGGLING
Digital overload can turn off consumers
Limitless digital space needs to make more room for diversity
WHAT TO WATCH
Social media: the modern day window shopping
Virtual reality will be necessary to appeal to multichannel beauty shoppers
THE CONSUMER – WHAT YOU NEED TO KNOW 
The beauty purchase process mixes online and offline
Consumers seek a mix of informative and inspirational content
Visual nature of social media compensates for the void of in-person shopping
Consumers want convenience of online but seek reassurance when buying without seeing
ONLINE BEAUTY CONSUMERS AND ONLINE ACTIVITY
Analyst Perspective
Most consumers are navigating across channels
Figure 9: Online activity and types of online beauty consumers, October 2019
Beauty consumers invest time in pre-purchase research
Younger adults’ emphasis on beauty opens the door for more brand engagement
Figure 10: Types of online consumers, by age, October 2019
TYPES OF ONLINE CONTENT
Analyst Perspective
Curious beauty consumers crave content
Figure 11: Types of online content, October 2019
Young women want to master their look, but need guidance doing so
Figure 12: Types of online content, by gender and age, October 2019
Figure 13: Ulta’s top creatives, November 2018
Figure 14: Sephora top creative, July 2019
Hispanic consumers’ interest in ingredients signals focus on holistic wellness
Figure 15: Types of online content, by Hispanic origin, October 2019
ACTIVITY BY ITEM
Analyst Perspective
Consumers seek validation from multiple sources
Figure 16: Activity by item, October 2019
Women conduct more activity, regardless of item
Figure 17: Activity by item, by gender, October 2019
Shoppers seek instructional content to maximize their purchase
Sources of inspiration
PREFERRED ONLINE RESOURCES
Analyst Perspective
YouTube is a preferred resource nearly as much as beauty websites
Figure 18: Preferred online resources - NET, October 2019
Figure 19: Ouai YouTube video, October 2019
Figure 20: Ouai YouTube video, October 2019
Brands see the worth investing in YouTube
Figure 21: Sephora site spend, October 2018-November 2019
Figure 22: Ulta site share, October 2018-November 2019
Older women turn to category experts
Social media is a crucial resource for younger beauty shoppers
Figure 23: Preferred online resources, by age, October 2019
SOCIAL MEDIA USE
Analyst Perspective
Social media is the virtual version of window shopping
Figure 24: Social media use, by gender – October 2019
Figure 25: Everlane Instagram stories, September 2019
Informative and instructional content adds value for young women
Figure 26: Social media use, by gender and age, October 2019
Young men are shopping through social
Figure 27: Social media use, by gender and age, October 2019
BRAND AWARENESS AND DISCOVERY
Analyst Perspective
Consumers are paying attention to beauty ads online
Figure 28: Brand discovery, October 2019
ColourPop products live up to their name
Figure 29: ColourPop Instagram post, November 2019
Goop is sleek, chic and clean, just like its products
Figure 30: Goop logo
Glossier pink has evolved beyond a catchphrase
Figure 31: Glossier Instagram post, August 2019
Figure 32: Glossier Instagram post, July 2019
A variety of marketing tools prove effective for engaging young men
Figure 33: Brand discovery, by gender and age, October 2019
Influencers and peers are equally effective for promoting discovery to youngest beauty consumers
Figure 34: Brand discovery, by age, October 2019
DESIRED IMPROVEMENTS
Analyst Perspective
Simple reassurances will encourage more shopping
Figure 35: Desired improvements, October 2019
Gen Z wants VR and IRL
Figure 36: Bite Beauty Instagram post, August 2019
Figure 37: Desired improvements, by age, October 2019
Better product selection will drive more shopping among multicultural consumers
Figure 38: Desired improvements, by race and Hispanic origin, October 2019
Figure 39: Fenty Beauty by Rihanna YouTube video, January 2019
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Consumer survey data
Consumer qualitative research
Abbreviations and terms
Abbreviations