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Beauty Billions

2 Mins read

The last time we wrote about the beauty business, we focused on growing makeup sales. Now let’s look at the bigger picture—e-commerce sales. Shopify has an informative report about the fast-growing online beauty industry.

Shopify reports that American shoppers will spend nearly $24.5 billion on beauty and cosmetics online this year. And the sales are taking place across all demographics.

Online beauty sales are dominated by two corporate giants—Sephora and Ulta. But that doesn’t mean there’s not room for entrepreneurial disruption in the industry.

The Shopify blog covers the hottest e-commerce beauty trends for 2023. Three of note:

Generation Z & TikTok

We’ve been writing a lot about Gen Z lately. That’s because this generation is coming of age, entering the workforce, earning more money, and spending it. And they’re increasingly buying stuff on social platforms. According to Insider Intelligence, total social commerce sales are projected to increase 63.3% between 2022 and 2024 to $86.7 billion.

Shopify says this social commerce spending is led by Gen Z—over half of older Zers (18-24) are regular social buyers. And almost half of teens (14-17) are. They’re most likely to buy clothing and beauty/skin care products online.

And, says Shopify, TikTok is “becoming a hub for beauty content. #Beauty currently has more than 107.8 billion views and is one of the biggest product categories on the social site. In addition, TikTokers are 1.6 times more likely to turn to the platform for fashion and beauty inspiration.”

Beauty subscription boxes

Another trend Shopify calls out is beauty subscription boxes. It says these are a “great way for the cosmetics industry to retain loyal customers over the long term.” Nearly a third of Americans signed up for a retail subscription box as of last year—spending $57 a month on average.

If you’re considering this business, start in a niche. Consider catering to specific demographics, regions, or life stages, like pregnancy or people recovering from illnesses.

Sustainability

A quick note about sustainability—it sells. A survey from Insider Intelligence shows that 24% of those surveyed say that having products free of harmful or synthetic materials is “extremely important,” and 18% say it’s important that products have sustainable packaging.

In a Shopify survey, 42% of consumers say “knowing a brand is actively working on reducing their carbon footprint” is important when deciding whether to purchase a product online.

There’s a lot more to learn in the Shopify post. Check it out.

 

Beauty stock image by Savanevich Viktar/Shutterstock

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