Published by Kevin TIGA in Fashion news the 7/08/2020 at 13:30
This article will be entirely devoted to a situation that took place in France during the containment. Of course, some data on the beauty market can also be identified at a global level, but we will only focus on one country in particular.
Confinement has been a very hard ordeal for many luxury brands. It has been an opportunity for these brands, especially in the beauty sector, to test the importance of digitalization.
The luxury sector has traditionally been very much focused on the principle of physical sales.
The quality of service through physical presence is no longer to be proven, as the excellence of these points of sale has been pushed to its paroxysm. However, there is a growing phenomenon that the luxury sector cannot afford to miss: digitalisation.
We have seen that over the last few years, digital initiatives have multiplied to boost the sector's activity once again.
However, the coronavirus crisis has shown that beauty is more than ever dependent on the digital sales channel to secure its sales.
In the midst of the coronavirus health crisis, the physical store networks had to close. Faced with such a situation, beauty brands were forced to adapt. Often dependent on their physical points of sale, beauty brands saw their sales drop during the first quarter of 2020.
For example, the Japanese brand Shiseido saw its sales drop 55% in the first quarter of 2020 compared to 2019.With the global health crisis and the closure of physical stores, beauty brands had no choice but to accelerate their migration to the web.
Thus, retail chains such as the Sephora brand (of which 490 points of sale were closed) have suffered the confinement with many difficulties: extended delivery times, very slow e-commerce chain ....
Despite this very tough situation for brands and retail chains, customer behaviour remained the same.
This is highlighted by one of the leading market research specialists, the NPD Group, in a study published in April 2020 (study published in French).
According to the study, sales of fragrances on the web increased by 73% in April 2020 compared to 2019. These sales on the web partly compensate for the losses incurred by the closure of physical sales networks which, for their part, obviously saw their sales figures fall by 88% over the same month of April 2020.
With this increase in web-based sales, an online platform stood out from the other known online platforms.
As the development of some beauty brands is still minimal, they have preferred to rely on online platforms.
This is how Amazon saw its catalogue increase during the confinement months and in the following months.
Why Amazon? Quite simply because it is the most used online platform in the Western world.
A hegemony that obviously attracts premium beauty brands.
In July 2019, the cosmetics brand Haus Laboratories, created by Lady Gaga, even chose the Amazon platform for its global launch.
An exclusivity that was reserved, at first, only for Amazon Premium members. A way to increase visibility to the global luxury beauty market and Premium subscriptions for the platform.
In fact, the traffic rate has been so high for Amazon that it is in a perfect position to negotiate very advantageous additions to its product catalogue.
As a result, the skincare brand S.W. Basics stopped selling its products on other e-commerce platforms.
The way of digitalization and the association with e-commerce platforms for brands is now more and more recognized.
However, some luxury brands remain on their reservations. This is the case of Chanel and Dior for example.
For these brands, associating their names, absolute synonyms of what luxury can represent in the minds of consumers, with Amazon could be damaging to their image. Amazon being known and having built its image on the accessibility of these products and the attractive prices.
Two aspects that cannot be associated with the usual codes of luxury that these brands represent.
Innovation can then only be the solution to suit these great names of beauty and luxury.
They are precisely the first to use the new levers of social networks to communicate with their customers: new filters with Dior, gamification, high value-added content...
A good way for brands to respect in contact with their audience despite the period of confinement and to make a lasting impression on the minds of their customers.
Photos credits: Pixabay
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