Beauty Brands Must Bridge Their In-Store and Digital Media Strategies

Mass market beauty brands spend a lot of time thinking about how to get customers to “the wall” as well as how to engage with them once there. That’s the classic in-store experience. It’s where beauty buffs sniff, sample and draw on their hands as they imagine the possibilities. But the online path to purchase for cosmetics is the opposite of that tactile experience. No wall. Just endless scrolling shelves. However, there's no choice but to figure it out. The beauty market, like most other industries, has been upended by the radical changes in consumer behavior during the pandemic. Consumers say they are now 400% more likely to purchase their makeup and personal care products online, compared to pre-pandemic. So the question becomes, "How do we engage with our audience at the digital wall?" And now that in-store shopping is resuming, marketers must also grapple with engaging consumers digitally before they get to the physical wall. Enter retail media. Think of your favorite drugstore mascara brand. When was the last time you went to the store's website? Unlike many consumer product companies, beauty brands do not routinely have robust transactional websites. The main purpose of most beauty websites (assuming it’s not direct-to-consumer) is more to brand and inform, not as much to sell. The assumption is that you’re going to the store to buy the product or at the very least, purchasing it on an ecommerce site with other seemingly unrelated items. As one might expect, Amazon is the biggest player in the space, with the lion’s share of the online beauty market. That’s largely due to the seemingly endless variety of brands and products on offer, as well as the fact that more than half the world is logged in and ready to buy on the site at any given moment. On the brick-and-mortar side, Walmart carries a large portion of the mass beauty market. And let’s not forget specialty retailers. Ulta.com, the third-largest online beauty etailer—which also just opened 80 mini stores inside Target—has launched a retail media arm to compete with the likes of Amazon Advertising. Ulta Beauty's sales may be smaller than Walmart and Target, but what makes it an excellent destination for brands to put in their advertising dollars is the niche audiences and rich first-party data in the form of loyalty cards. So, you might be asking, what’s a beauty brand to do? Invest with the specialty retailer? Amazon? Walmart? The specialty retailer inside of the big box retailer? All of the above? Someone else? To decide, here's what brands should keep top of mind: Bridging the online/offline disconnect There’s a disconnect in closing the purchase loop when it comes to retail media. Because the mass market beauty price point for an item is usually low, in-person transactions are often made in cash and in-store. That makes tracking the effectiveness of online advertising to brick-and-mortar sales rather tricky. Not all digital transactions are traceable Just because it’s digital doesn’t mean we can always close the loop either. People still behave online the same way they do in-store—unpredictably. We change devices, browsers, check out as guests, use gift cards and clear cookies. The hybrid experience On the in-store wall, each brand has its own section. They may compete against each other side-by-side, but the brand’s collection is typically displayed as a unit. Integrating an online experience with the in-store visit is a powerful combination for a brand. The need to be social Social platforms do a bang-up job in taking first-person data from retailers and adding in their targeting prowess and powerful apps to create a powerful tool for retail media. And retailers are eager to monetize these social accounts and utilize the years of their social team’s efforts of curating, gaining followers and posting compelling content. Fiercely loyal Specialty retailers often have loyalty programs and an even more engaged customer base than their big-box competitors. The power of this smaller but highly engaged audience cannot be understated. Retail media is relatively young A lot of retailers may give the impression that they can close all the loops. Yes, but no. There are still a ton of caveats, asterisks and fine print. Through innovation and hustle, brands can gain their own visibility. Case in point: The e.l.f. beauty squad loyalty program is genius. It lets members take pictures of their receipts and upload them for credit no matter where they buy its products. So where does all of this lead us? Mass market beauty has more to win—and conceivably, to lose—now that consumers are more comfortable buying cosmetics online. No space will be more important to conquer than point of sale at retailers like Target, Walmart, Ulta and Instacart. Marketers must look for their blind spots, find ways to innovate and hopefully elevate their brand's experience, whatever shelf the customer is looking at.