Cosmetics and Beauty Industry Sees Boom as Millennials Buy More Make-Up

Retail

Jan 08
Women applying make-up

 

Make-up and cosmetics have long been popular among youngsters; however it is now even more evident as the industry is seeing increasing sales and good demand online and in stores even while other retailers face a tough selling environment.

A recent article in the New York Times said that young shoppers were a driving force behind the boom in the cosmetics industry. Millennials, who are now seeking to be ‘always camera ready’, are buying and using 25 percent more cosmetics than they did two years ago and significantly much more than baby boomers, it said.

This boom in the cosmetics sector comes in an environment while other retailers are seeing drop in sales. Companies like Ulta Beauty and Sephora have seen increased revenues and new store openings.  The New York Times article also added that the growth in the cosmetics industry is probably understated, since most estimates fail to capture sales at online retailers like Amazon.

Newer brands are making their presence felt too. 20-year-old model and reality TV celebrity Kylie Jenner’s Kylie Cosmetics has made more than US$420 million in sales in just 18 months without any traditional advertising. The products gain popularity on Instagram and other social media. Pop star Rihanna’s Fenty Beauty has seen many of its products going out of stock due to increased demand.

Cosmetic companies have been quick to cash in on new age advertising by using social media celebrities to their advantage. Make-up and skin care companies have seen products fly off shelves after being promoted by popular YouTube influencers and Instagram celebrities. Brands are now collaborating with millennial celebrities with a large following to reach their target audience directly without having to rely on traditional advertising.

More advertising dollars are now being spent on Youtube and Instagram celebrities than print advertising, according to experts. Celebrity influencers with a large following online are taken on trips to exotic locations and sent new products, they in turn pass on the message to their subscribers who don’t hesitate to buy the new make-up and skin care recommended by their favorite Youtuber or Instagram personality.

It is not just the new launches that are receiving the attention of millennials online. Even products that have been around for a while see a jump in sales after being endorsed by social media celebrities and beauty gurus.

Estée Lauder’s Double Wear foundation, a product that was launched 30 years ago, is experiencing double-digit growth rates, Jane Hertzmark Hudis, group president at Estée Lauder said in the New York Times article.

Companies are relying on beauty bloggers to popularize their products even as subscribers learn new makeup techniques and ways to use the products. While this is not a new phenomenon, it is only recently that larger companies are using Youtubers and Instagram celebrities instead of traditional print and TV advertisements. Earlier it was the smaller brands who reached out to beauty gurus online to help popularize their products by including then in a beauty tutorial or make-up look video. More brands are now realizing the reach of the beauty gurus and the buying power of millennials.

It is not surprising that millennials are buying the products they see online. They are spending a lot of time watching Youtube makeup tutorials and browsing content online. According to Pixability, a Boston-based company that tracks influencers and provides data to brands, global views of beauty videos on YouTube surged 60 per cent, to 219 billion with millennials making up 60 per cent of the beauty audience on social media site Facebook.

Using beauty bloggers and Youtuber also brings a certain risk element to the beauty companies since their content cannot be monitored strictly and comments on posts can often be negative. However, most brands are willing to take the risk in the hope of the increased reach of their products.

However some experts have said that millennial are a tricky group since their choices and priorities can change in an instant. Instagram, which is where a lot of the make-up get promoted, wasn’t something that millennials used a few years ago.