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Feb 02, 2021

The Importance of Amazon in Beauty eCommerce

We know that Cult Beauty, Feelunique and Look Fantastic are heavy hitters in the world of beauty eCommerce. But, what about Amazon? The store is emerging as a go-to for cosmetics-loving consumers. Prime shipping, price reductions and product choice are just some of the reasons shoppers flock to the site – and there are big benefits to be had for beauty brands who sell products on Amazon, too.

But is it the right retailer for your brand? Here, we reveal the impact Amazon is having on the beauty industry, and the key things you need to consider before you stock products on-site…

 

Amazon is Thriving in Lockdown

There’s no denying it: Amazon is one of the largest and fastest-growing retailers in the world. It thrived where others might have failed in 2020, with a 47% increase in revenue year on year. At the start of the COVID-19 pandemic, a report from Wunderman Thompson found that 63% of shoppers start their online searches for products on Amazon, while 75% wished more retailers would offer the same level of services as the mega shopping platform.

It’s this positive affinity that makes Amazon so appealing to marketers in all verticals. With such a flurry of traffic at brands’ disposal, you almost can’t afford to turn your back on the platform. The benefits of shopping on-site – such as low costs and speedy service – prove beneficial to brands, too. And, as lockdown rumbles on its success is only set to soar through 2021.

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How Amazon is Impacting Beauty

Selling beauty on Amazon is not the same as selling Blu-ray box sets or garden utensils. The industry is all about aesthetic, and the Amazon interface is focused on function and promoting low prices. For this reason, a number of luxury beauty houses fear a stigma attached to selling on the site, believing it may negatively impact their brand equity.

However, high demand is guiding beauty brands’ decisions about selling on the platform – not to mention the game-changing results experienced by cosmetics companies in 2020. According to Vogue Business, Wunder2 saw a 126% spike in sales of its core products during lockdown, while Oars + Alps reported a 15% increase in sales on the platform since US quarantines began.

Meanwhile, pioneers such as Lady Gaga’s Haus Laboratories and Kao’s MyKirei are embracing Amazon whole-heartedly by launching their products exclusively on the site. Such moves serve to highlight Amazon’s role in the beauty marketplace, paving the way for other brands to explore exclusive offerings. Watch this space, because there’s bound to be more.

 

3 Things to Consider Before You Sell On Amazon

1. First Party or Third Party

The first decision you need to make about selling on Amazon is whether to distribute products yourself, or provide wholesale to third party sellers. One reason luxury brands tend to shy away from the latter is lack of control, both when it comes to the content displayed and the customer service provided. The worry is that, if customers have a bad experience with your brand via a third party, this may damage their overall impression of your products.

2. Luxury Gating

Amazon first embraced the beauty market in October 2013, providing luxury brands – such as La Mer and Dior – the opportunity to ‘gate’ their products and prevent third party sales. This feature is one of the critical benefits of choosing a first party relationship with the platform. However, keep in mind that the system isn’t perfect, and you’ll still need to be on the lookout for knockoff and grey market sellers.

3. Conversion-Driving Content

Content is a key component of optimising the digital beauty shelf, and this is especially true when the shelf you’re ‘stacking’ is on Amazon. The platform allows for detailed product descriptions, an image gallery and keyword insertion – and, like Google, it rewards complete content with higher search rankings. Beauty brands should be prepared to create Amazon-specific copy and visuals to drive success, providing swatches, videos and bullet points that highlight unique selling points.

 

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How We Can Help

We are specialists in media and etail data analytics for the beauty industry. Learn more about how we can help you with your digital disruption by emailing us at hello@mmi-analytics.com.

 

February 2, 2021