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A Beautiful Look at the Cosmetics Industry

A Beautiful Look at the Cosmetics Industry

With the year almost wrapped up except for the holiday season drive, we thought it’d be the ideal time to look back on the year and how it’s impacted the beauty and cosmetics industry.

Of course the pandemic has hit the world hard in every aspect – socially, culturally, financially, and economically.

Like most commerce categories, the beauty industry has also been dramatically affected by the pandemic. Within the US, the personal care industry contributes to over $235 billion in GDP and employs more than 3.5 million people.

A Beautiful Look at the Cosmetics IndustryUnderpinning beauty and cosmetics is a large base of physical store sales. People want to know what the lipstick color looks like without the lighting and shadows of images; what cream works well with their own skin. Only a small amount of change comes in via online. Although when we’re talking about the major brands, that change adds up to millions of dollars.

The strong shift in shopping behavior from majority in-store to majority digital has taken its toll on retailers and brands, with parallel performances of drops in overall sales yet spikes in online sales. 

In fact, overall, as an industry, the beauty and cosmetics space has noticed a 25% increase in ecommerce during the first half of 2020, when compared with the same time last year. For those brands who have invested smartly in technology in the last decade, they’ve reaped the most rewards.

And the highest performing brands have a particular technological commonality: the majority of major beauty and cosmetics brands use Salesforce Commerce Cloud, the chosen ecommerce platform for high-volume retailers that need its scalability, its ability to integrate complex ERP systems, and its multivariate and A/B testing capabilities.

Actually, I shouldn’t have said “the majority” of brands because that sounds too vague. You can say that about all sorts of things which you don’t know any stats or figures for. Instead, we know through our own industry research that 48% of the top 32 beauty and cosmetics brands are currently using Salesforce Commerce Cloud.

Take the world’s leading brand (and parent of other brands), L’Oreal, for example, which pockets more than $30 billion in sales. Over a number of years it has integrated over 100 ecommerce sites across 63 markets. Plus L’Oreal makes use of Salesforce’s ease of integration with members of its cloud family, working with Salesforce’s customer service center to better communicate and assist with its customers.

Holiday season forecast

A Beautiful Look at the Cosmetics IndustryThe feel-good factor of the holidays is, of course, going to be very different this year. But humans are resilient to adaptations and change, and will continue to do what they can to make the holidays special, holding onto traditions that can be maintained in 2020. And the tradition of present-buying and pampering oneself is likely to play a large part – just like any other year.

Whether these numbers will be comparable to previous years remains to be seen. But we will see. With time.

PS: UV is one of the world’s leading Salesforce Commerce Cloud (Demandware) tech teams. Contact us to see how we can work together.

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