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QuickBox Fulfillment Dec 14, 2023 6 min read

How Beauty Buyers Adapt to Changing Economic Incentives

Any buyer (and therefore, seller) is impacted by changing economic incentives, and beauty buyers (and sellers) are no different. Current economic conditions can mean buyers have less (or more) expendable cash. And beauty trends impact how, where, and what beauty buyers spend their money on.

Changing Economic Conditions for Beauty

The beauty market, which includes skincare, fragrance, makeup, and hair care, generated an astounding $430 billion in 2022. Recently, this market has experienced significant changes. For instance, there’s been a huge growth in ecommerce, which has nearly quadrupled between 2015 and 2022.

This development is only expected to increase, as economists predict ecommerce will grow by 6% year over year through 2027 to reach $580 billion. Beauty is a stunning industry to be involved in as it remains one of the most resilient, even during turbulent economic times.

Yet economic changes also shift consumer behavior. For example, one 2023 study found that 24% of customers plan to decrease their spending on beauty products, while 47% plan to maintain current spending levels, and 29% intend to increase their spending. This diversity may indicate a strong mix of cost-conscious behavior with a desire for “affordable luxury” as well as premium self-care.

Changing Buying Patterns for Beauty Buyers

Most beauty consumers are showing a preference for omnichannel shopping as they blend in-store experiences with online shopping to discover and experiment with new products.

The lines are also blurred between beauty and general wellness. That is, consumers who seek beauty products want products that not only enhance their appearance but also contribute to their well-being. This includes interest in skincare and makeup made with pure, clean, natural ingredients as well as supplements and beauty devices. Together, the wellness industry is expected to see an annual compounded growth rate (CAGR) of 10% through 2027.

Newer customers from Gen Z are shaping beauty trends as they demand transparency in ingredients and are looking for brands that share their values in sustainability, diversity, authenticity, and inclusivity tied together with a powerful story. For instance, Gen Z consumers report extensive research into product ingredients and a welcoming approach to a wider community before purchasing. Changing demographics are also reshaping beauty standards and challenging traditional norms.

These trends aren’t isolated to Gen Z consumers either. A growing number of consumers of every age are seeking products made with clean, natural, and organic ingredients that promote their well-being and the health of the environment. Indeed, a growing number of beauty buyers are looking for brands that embrace the environment.

Up to 71% of beauty buyers also expect more of a personalized experience when they shop, and many (up to 3/4) are frustrated when this personalization is missing.

And, of course, social media and digital engagement on platforms like TikTok and Instagram have become crucial for brand engagement and beauty sales, especially for customers between the ages of 18 and 44, who increasingly make purchases directly through social media platforms. Brands that understand how to leverage these platforms effectively can see increased sales, as nearly half of all social media users are expected to make at least one social purchase this year.

How Beauty Buyers Are Responding to a Changing Economic Environment

With the changing times and economic uncertainties, we’ve seen beauty buyers adjust spending patterns and online shopping habits. In turn, beauty sellers may need to adjust their business models to better adapt to these changing incentives by:

  • Enhancing online and omnichannel presence and optimizing websites for a better user experience, including improving mobile shopping capabilities and integrating online and offline channels for a seamless customer experience.
  • Focusing on consumer experience and engagement by building personalized experiences and engagement to foster brand loyalty. Embracing social media, personalized marketing, and enhanced customer service to create a more inviting, immersive, and engaging experience with your brand.
  • Adapting to customer preferences for authenticity and sustainability with clean beauty products and environmentally friendly, ethically sourced ingredients. Communicating your shared values clearly with customers can attract a more conscious and loyal customer base.
  • Offering value-oriented products as customers become more price-sensitive. Offering products or bundles that provide good value for the money can appeal to more budget-conscious consumers.
  • Leveraging data analytics for important market insights to help you better understand and anticipate your customers’ changing behavior and preferences, allowing you to adjust product offerings, marketing strategies, and pricing models.
  • Introducing flexible pricing and payment options such as tiered pricing or subscription services to accommodate different budgets and maintain or even scale sales volume and promote growth.
  • Investing in research and development, especially in emerging trends like natural ingredients, wellness-focused products, and advanced beauty technologies to promote healthy aging and keep your brand relevant.
  • Diversifying product range with different price points for people seeking everything from more affordable options to premium items.
  • Investing in responsive supply-chain management to better adapt to changing economic incentives, reduce costs, and ensure accurate, timely delivery of products to delight your customers with every order.

Implementing such strategies to evolve with your customers’ needs and preferences can help your company remain resilient despite shifting economic landscapes.

Reach out to QuickBox to discuss your beauty buyers and how you can better adapt to their unique needs. We don’t make you fit into our “Box”—we build a “Box” to meet your (and your customers’) changing needs!