Beauty Retailing: Incl Impact of COVID-19 - US - October 2020

OVERVIEW
What you need to know 
Key issues covered in this Report
Definition 
EXECUTIVE SUMMARY 
Top takeaways 
Market overview 
Figure 1: Total US retail sales and forecast of beauty products, at current prices, 2015-25
Impact of COVID-19 on Beauty
Figure 2: Short, medium and long term impact of COVID-19 on beauty Retailing, October2020
Opportunities and Challenges
Challenge: disrupted beauty routines will create challenges with driving basket size
Opportunity: evolve the digital experience to aid with research and inspire unplanned purchases
Challenge: consumers are evolving their beauty routines, beyond face-value
Opportunity: holistic wellness focus drives interest in new products and retail channels
Challenge: lack of diversity leaves some consumers underserved
Opportunity: cater to Black consumers through representation in product lines and marketing efforts
THE MARKET – WHAT YOU NEED TO KNOW
Shifts in lifestyles and spending create challenges for beauty retail
Conscious consumerism is changing the way people shop
Adding entertainment value may encourage impulsive purchases
MARKET SIZE AND FORECAST
Decreased use and limited spending causes declines in total beauty retail sales
Figure 3: Total US retail sales and forecast of beauty products, at current prices, 2015-25
Figure 4: Total US retail sales and forecast of beauty products by segment, at current prices, 2015-25
Impact of COVID-19 on Beauty Retailing
Figure 5: Short-, medium- and long-term impact of COVID-19 on beauty retailing, October 2020
Lockdown
Reemergence
Recovery
COVID-19: US context
Learnings from the last recession
MARKET FACTORS 
Budget-conscious consumers reevaluating how much they spend on beauty
Beauty consumers expect to see diversity at retailers
Figure 6: Number of households, by race and Hispanic origin of householder, 2013-23
Retailers replace the in-store experience with virtual tools and chats
Figure 7: Urban Decay live pride-day makeup tutorial, May 2020
Conscious consumers impact beauty
Figure 8: Beautycounter product page, October 2020
MARKET OPPORTUNITIES
Embrace the fun
Figure 9: Tactha Animal Crossing Experience. July 2020
Affordable clean beauty will have widespread appeal
Figure 10: CeraVe partner video on #maskne, August 2020
Reinvent the product sample offering
COMPANIES AND BRANDS – KEY TAKEAWAYS 
Beauty brands are rethinking customer engagement
Diversity in the beauty aisle
COMPETITIVE STRATEGIES
Beauty brands and retailers adapt to the multichannel experience
Figure 11: Shopping method – NET, August 2020
Figure 12: Sephora and Instagram partnership, June 2020
Figure 13: Bobbi Brown virtual consultations, July 2020
Going beyond skin deep: beauty brands are embracing holistic wellness
Figure 14: Maybelline virtual health summit, October 2020
Representation in the beauty aisle needs to change
Figure 15: Beautycounter change beauty forever, August 2020
THE CONSUMER – WHAT YOU NEED TO KNOW 
High-use essentials are top purchases
The competitive landscape is shifting
Beauty shoppers make informed and considerate purchases
Approaches and attitudes toward beauty shopping are changing
CONSUMER TRENDS IMPACTING BEAUTY RETAILING
Value
Wellbeing
Surroundings
CHANGES BECAUSE OF COVID-19
The pandemic disrupted beauty consumption
Figure 16: Changes because of COVID-19, August 2020
Younger shoppers still want to explore, and the comfort of home may be the perfect place to do so
Figure 17: Select changes because of COVID-19 – by age, August 2020
ITEMS PURCHASED
High-use essentials are driving the category
Figure 18: Items purchased, August 2020
Black consumers’ purchases indicate a possible gap in assortment
Figure 19: Items purchased, by race – August 2020
RETAILERS SHOPPED
Consumers are shifting their purchases online
Figure 20: Shopping method, August 2020
Figure 21: Retailers shopped – online, August 2020
Convenience influences where men shop for beauty
Figure 22: Retailers shopped online – by gender, August 2020
A combination of value and experience appeals to multicultural consumers 
Figure 23: Select retailers shopped – by race and Hispanic origin, August 2020
PURCHASE CONSIDERATIONS
Beauty purchases go beyond price and brand
Figure 24: Purchase considerations, August 2020
Ingredients and recommendations influence young women
Figure 25: Purchase considerations – by gender and age, August 2020
SHOPPING BEHAVIOR
Beauty shopping is an involved process 
Figure 26: Shopping behavior – NET, August 2020
Figure 27: Beautyque 3D virtual store, September 2020
The in-store experience draws in adventurous, younger shoppers
Figure 28: Select shopping behavior – NET – by generation, August 2020
Multicultural consumers want to invest in the right brands
Figure 29: Shopping behavior – NET – by race and Hispanic origin, August 2020
ATTITUDES TOWARD SHOPPING FOR BEAUTY
Women are evolving their beauty routines in response to current lifestyle shifts
Figure 30: Attitudes toward shopping for beauty – by age and gender, August 2020
Educational engagement can keep older shoppers invested in beauty online
Figure 31: Turner Classic Movies Podcast introduction and instructional video, May 2020
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Abbreviations and terms
Abbreviations