Online Beauty Shoppers Shop More Frequently in 2014…

Beauty and personal care—an industry traditionally rooted in the ability to touch, smell, sample and experiment with products—is being played by a new set of rules, according to “Beauty and the E-Commerce Beast: 2014 Edition.”  The results of the study by A.T. Kearney are encouraging for some and may be threatening for others, but one thing is certain: e-commerce is now an integral part of the business of beauty.

According to the report, 47% of survey participants stated that they purchased more beauty and personal care products online this year compared to last year, including a significant increase in shopping for more “experiential products” such as fragrance and color cosmetics. In fact, both reported a 16% increase over 2012 in number of people who frequently purchase these items online, according to the study data.

“Beauty online is so much more than just a transaction,” noted Hana Ben-Shabat, A.T. Kearney partner and co-author of the study. “It is, in fact, one of the most active categories on the internet. So online is becoming one of the most important paths to purchase. And those who buy beauty products online, make frequent purchases. For example, what we’re seeing in this year’s study is that there is an increased willingness on the part of consumers to buy fragrances and makeup online, versus habitually used products that they simply replenish.”

With sales of $4.3 billion and growing, online sales in beauty and personal care represent 6.5% of total sector sales, according to A.T. Kearney.

The study found that categories such as skin care have above average e-commerce penetration compared to personal care products such as bath care or hair care. A large difference in penetration also exists between prestige cosmetics and mass products where penetration is estimated at 11% and 6%, respectively.

“As e-commerce penetration is still only an estimated 6.5% of the total category today, the store remains the main channel for beauty and personal care. But the role of the store is shifting from a transactional platform to an experiential one, and increasingly every consumer who walks through the door is doing so armed with product information and opinions to a degree unlike ever before. This requires brands to rethink elements such as shelf planograms, retail staffing, and integration between online and in-store experiences,” added Kosha Gada, A.T. Kearney principal and co-author of the study.

“It’s no longer sufficient for beauty and personal care brands and retailers to invest experimentally in digital. Winning companies are those that can figure out how to make the link between online and offline, digital and physical. And collaboration between manufacturers and retailers in the quest for engaging today’s online consumer is more important than ever before,” added Hana Ben-Shabat.

In addition to the analysis of data, the study also provides a segmentation analysis of online beauty and personal care shoppers of which 50% are defined as creatures of habit—those who purchase online to replenish items they are familiar with. This type of shopping behavior gave rise to a variety of “replenishment programs” offered by some online retailers. Some 38% of the survey participants reported having subscribed at least once for such a program.

The A.T. Kearney study was conducted in mid-2014. It is based on an online survey of 1,022 consumers’ answers to questions about their shopping behaviors, motivations, favorite attributes and preferred online shopping destinations.