Online retailing trends in beauty care

Tom Branna
VP/Editorial Director

The sales figures are already enormous, but the potential is staggering. Global online sales are expected to grow 17.5% this year to $963 billion, according to a recent study by Siemer & Associates, Santa Monica, California, USA. But there’s plenty of room for more growth as online sales account for just 6.5% of all retail sales worldwide and are growing four times faster than traditional retail. As a result, online sales are expected to account for 9.3% of retail sales by 2016.

And while consumer electronics account for nearly 25% of all e-commerce revenue, there is an expanding space for beauty and personal care products in cyberspace. Every personal care company in the US, from multinationals such as Estée Lauder, Avon and L’Oréal to smaller, multimillion dollar companies such BeautyRx, M?naji and Cellure Stem Cell Skin Care, offer online sales. Still, online sales of beauty and personal care products are less than $4 billion, according to a study by AT Kearney. That’s a far cry from China, where online sales account for an estimated 50% of beauty purchases, according to experts.

The AT Kearney study, based on survey responses from 1,381 participants across the US and Canada, found that 62% shop online regularly, and of these, 60% purchase beauty and personal care products online. Among the most frequently purchased categories by online shoppers are skin care, personal care and hair care. 

Those Leading Digital Players

Avon, in its annual report says it is determined to increase the number of consumers served per representative and their engagement online.  Estée Lauder is more specific. In 2012, the company’s global online business grew 24% and Lauder operates more than 340 marketing and ecommerce sites in more than 50 countries. Rather than taking a one-size-fits-all approach, Estée Lauder is tailoring its online presence to match its brands and their followers. For example, The Bobbi Brown Cosmetics Everything Bobbi blog, which is billed as an online magazine-meets-blog, gives Bobbi Brown fans a real, unscripted look at the makeup artist’s world and the things she loves, according to the company. Meanwhile, the all-important travel retail channel calls for unique online presence in each country. 

“Before the consumer even begins her trip, our online messaging opens her eyes to purchasing opportunities that will greet her along the way,” according to Estée Lauder. No wonder then, that a recent benchmarking report named The Estée Lauder Companies the most competitive beauty company in the digital space.“We increasingly see our online e- and m-commerce sites as digital “flagship” stores that offer unique opportunities for engaging and customizing consumer experiences,” said Estée Lauder in its annual report. “Pulling consumers to these sites and to our retailers is an integral part of our strategy.”

To attract consumers to its various sites, Estée Lauder has created some novel content. The High-Touch On-line Skin Care Guide developed for www.Origins.com, is an interactive tool that offers consumers personalized recommendations and feedback based on individual skin care concerns. At www.JoMalone.com, visitors can get fragrance-combining consultations. Finally, Smashbox relied on an app, aptly called “Lights, Camera, BB!” to educate them about the benefits of BB creams, while allowing them to put themselves into their very own BB cream commercial.

Interestingly, when it comes to online health and beauty sales, it’s Amway, not Avon or Estée Lauder, with the most sales, according to Internet Retailer, a US business magazine. In fact, Amway’s held the No. 1 spot on tAir Jordan I Mid