“The online sales of beauty and body care products in Europe is set to grow more than eight per cent each year up until 2019. That means the online channel reflects four times the growth of stationary retail stores,” according to Dr. Mirko Warschun, head of the Consumer Industries and Retail practice at A.T. Kearney for Europe, the Middle East and Africa.
This is one of the key findings from the firm’s current study of e-commerce trends for beauty and personal care products. Based on representative surveys of consumers in Germany, Great Britain and France, the global management consultancy company has been publishing this study annually since 2012. In addition to price - which is still the number one reason for online shopping - other purchasing criteria are gaining increasingly in importance: already half of those surveyed look for product information, customer ratings, tips and styling ideas.
The study reveals that innovative applications such as online tests, mobile skin type apps, beauty forums and communities with expert tips, illustrated product reviews or complimentary samples with the delivery offer online retailers good opportunities for competitive differentiation. This is also a way to capture the 20 per cent of surveyed consumers who say they do not shop online because they need to see, feel and test a product.
“Retailers and brand owners who also give their customers a feeling for their products online are definitely ahead of the game,” adds A.T. Kearney e-commerce expert Dr. Peter Pfeiffer. At the same time, British customers expect a high level of convenience. Nine out of ten feel a delivery time of no more than four days is acceptable. About half of those surveyed feel shipping should be free. However, if there are costs associated with delivery, 93 percent of the respondents said five Pounds would be the maximum limit per shipment.
Buyer groups identified
Overall, the study separated the target groups into five types according to age, monthly disposable income for beauty and personal care items (on-and offline), willingness to experiment and delivery expectations. The five groups are: Classic Beauty Shoppers (46 per cent), Natural Cosmetic Lovers (8 per cent), Health Conscious Shoppers (17 per cent) Fashionistas (9 per cent) and Beauty Junkies (10 per cent).
“Online retailers should use the differences among these consumer groups to tailor their promotions in order to attract Beauty Junkies and Fashionistas to new products or brands,” according to Pfeiffer. Although these two segments make up the smallest share of shoppers at the moment, they spend two to three times more money per month on beauty and personal care products than the “classic” online customer. What’s more, they enjoy a higher level of disposable income and are therefore more willing to pay for delivery and returns.
In addition to product customization and tailoring ingredients and preservatives to specific customer needs, organic and natural cosmetics are a growing trend for online retailing in Europe: the majority of shoppers buy these products online, either exclusively or occasionally. However, in the U.K. so far it’s only 37 per cent who occasionally buy these products online.
The study also reveals that Amazon is clearly the market leader among shopping addresses when it comes to make-up, perfume or shower gel. In Great Britain, Amazon is followed by the drugstore chain Boots, which is also the third most important brand in the country.
“Online beauty shoppers are no longer looking at just price. They value the comfort of digital shopping, are looking for information and want to try new things. Customer knowledge is therefore becoming the key factor for success in online retailing since preferences are quite different depending on country and consumer segments,” adds A.T. Kearney consumer goods expert Warschun.
