Learn why eCommerce edge storefronts for beauty and cosmetics brands are the future of online shopping to increase business sales.
Irrespective of the changing consumer needs and preferences, beauty and cosmetics products have continued to grow in popularity across the globe in a vast demographic. As per Statista, revenue in the cosmetics segment amounts to US$103.80bn in 2023 alone.
The market is further expected to grow annually by 4.84% CAGR between 2023-2027. The same study of the industry has also found per person revenues of US$13.50 being generated in 2023 itself.
The increasing need for beauty and cosmetics products and their affordability has definitely led to a lot of business opportunities.
Today, we see new cosmetics brands entering the market every other day - keeping beauty and cosmetics brands started by celebrities aside, how many others do you remember?
Research shows that around 80-90% of eCommerce businesses fail in the first six months of launch - from increasing competition, cost of customer acquisition to inability to keep up with consumer interests and preferences, the reasons are plenty.
One of the key drivers of beauty and cosmetics sales being - influence.
Whether it is a makeup look that went viral because of a celebrity at the Oscars or a TikTok that went viral, most consumer purchases in this segment are heavily influenced by the content we consume.
That’s exactly why the traditional approach of using content to drive consumers to a website for purchases is no longer as effective.
It’s time to reverse the game and bring eCommerce to where the consumers engage with the content.
Redefining the future of beauty and cosmetics eCommerce with Edge Storefronts
Before we start talking about why Edge Storefronts are the future of beauty and cosmetics eCommerce businesses, let’s take a quick look at the status quo of how the industry works today.
Status quo of beauty and cosmetics shopping online
Owing to the pandemic as well as the way we consume content and the ease of shopping online, there has been a steady increase in the percentage of sales made through online channels as compared to offline in the beauty and cosmetics industry.
From what used to be all about trying the product or testing it in-store with the help of brand representatives, consumers worldwide can now be seen skipping the physical step to quickly shop online in most circumstances.
An average consumer’s journey to making beauty and cosmetics product purchase online typically includes:
- The consumer discovers the brand or its products on search or social media through image, video or media content
- They visit the beauty and cosmetics brand’s social media profile to validate their legitimacy
- The consumer then proceeds to the website through the link provider either on the content or in the bio
- After being led to the website, they search for the product they stumbled upon
- They either make a purchase, subscribe to a newsletter or abandon the eCommerce site based on the search results
- If they make the purchase, the brand retargets them with ads promoting similar products
- If they leave without making a purchase, the brand retargets them until they come back to complete the transaction
While this looks fairly simple - set up an online store, promote your beauty and cosmetics brand on search and social media, drive traffic to the website and get sales, no one accounts for the number of options available to the consumer at each stage or the amount of back and forth both the parties need to do before a sale is secured.
But when so many customer touchpoints have been established, why is this traditional approach a problem?
How big is the problem of beauty and cosmetics eCommerce growth?
Beauty and cosmetics brands have understood the importance of lifestyle content to influence consumer purchase.
Brands globally can be seen diversifying their marketing strategies to account for different target audience segments across various channels.
Even the biggest of brands like Kylie cosmetics can now be seen marketing their products across their own online store, social media, popular marketplaces, retail stores, etc.
To put things into perspective, you as a consumer, can choose to buy their range of products from any of the following channels:
And the above don’t yet account for the efforts that the brands have to put in towards running ad campaigns - on search and social media.
While Kylie’s brand sees success through her content and influence alone, other beauty and cosmetics brands do not see the same level of success through this diversification.
Despite the efforts to drive in as many interested buyers to the online store, the average conversion rate for beauty and cosmetics eCommerce hovers around 5.2% only.
As per research and surveys, it was found that it costs approximately $127 to acquire a new customer in the beauty and cosmetics industry.
Simply put, beauty brands can be seen increasing their spends on SEO, PPC and social media (39-81% combined). But when it comes to calculating the ROI and ROAS from respective strategies, the numbers are less than promising.
As per our research,
- CAC has risen by 222% in the last 9 years
- Brands lose $26 on every new customer acquired
- Underreported social revenue (almost 245%)
Why is the current approach to beauty and cosmetics eCommerce not working?
A study published by the International Journal of Science and Research reveals that various factors like quality, brand, price, advertisement and packaging have tremendous influences on consumer purchasing behavior in the beauty industry.
In addition to the same, it was also found that social media influence has the most amount of impact on how a consumer perceives the brand.
75% of internet users use social media to research products (DataReportal, 2022).
Think about the last time you wanted to experiment with a new makeup look and went onto social media to seek inspiration!
Our own research highlights that 90% of Gen Z routinely use social media as a part of their shopping process, instead of the traditional in-store experiences.
So when brands are accounting for it all with extensive eCommerce storefronts and active social media profiles, where does the problem lie?
The disconnect between the content that inspires the interest and intent of a consumer in beauty and cosmetics products on social media, and the way the same information is presented to them on the website.
Let’s explain this with an example.
Here are some clips from a popular beauty and cosmetics brand’s Instagram reel, showcasing different products used to get a no-makeup look:
If you watch the video, you’ll know exactly why we struggled to get the right screenshots to capture the product names!
While the video content is engaging, it requires you to either screenshot, note down or save it for later to find the products being shown on the brand website.
In this case, the caption provided by the brand does not state the exact product name or the SKU number that you can use to make the search.
So based on reading a few comments, you head over to their website to look for the products of your interest in the video - in our case, the lip color mixed with the concealer.
After searching through their website, here are the closest lip products we found:
And that’s when it dawned on us that the lip color used by the content creator is not by the brand - even though the rest of the products showcases, are. (The example took us 5 minutes because we really were searching for it.)
While the brand here did a great job at driving traffic to their site, this disconnect in what we perceived them to offer vs what we found on the site is exactly what we call the Experience Gap.
And brands are losing $700bn every year to this!
Here are some of the common reasons why the experience gap occurs when selling direct-to-consumer:
1. Shift of perceived value and confusion
As you promote your brand on social media, you focus a lot on how it appears visually and the collaborations you run. And as you start working with creators, they may use products other than your brand to achieve a certain makeup look or to highlight certain benefits of it.
This creates a shift in the perceived value as well as confusion in what your brand has to offer. In the above case, the brand actually sells skincare products that help you recover from makeup or make the makeup friendlier and prevent skin damage. But we thought they’re promoting how to achieve the whole look!
2. Loss of context
When moving from one platform to another (social media to your brand website), there can be a loss of context around ‘why they liked the product’. They may have seen a video on TikTok that inspired them to explore your products; but on the site, they are shown a completely different makeup look using the same products or a combination of different ones available in the collection. Add to that the short attention spans, and you have a bigger problem at hand!
Think about how a lip color may appear on dark skin promoted on social media vs the color shown on a lighter skin tone on the website.
3. Broken or incorrect links
Beauty and cosmetics brands have to create a lot of content to highlight the USP of their products - it’s not just about the deals and discounts they’re running.
So at the same time, they could be promoting different products every day.
But how, when and at what point a consumer discovers their social content can be different.
When we found the reel above, the link in bio had already been replaced with a simple URL to the homepage of the brand site.
In some cases, the consumer may make an effort to look for the product (we did). But in most cases incorrect links, broken URLs to sale pages and similar issues, can lead to you losing the consumer for good.
4. Incorrect or out of stock products
We didn’t find the lip color on the brand site - but then the brand site does not sell lip colors!
First impressions are often the last.
When consumers are led to products that are not in sync with what they consume through social media, or to items that are no longer available, it creates a negative impression of the brand almost instantly.
As Harvard Business Review states, stock-outs cause walk-outs!
Unless you are able to capture their intent and drive them to related products on the link, you’re giving competitors a new customer at your expense.
Simply put, beauty and cosmetics brands need to not just diversify their marketing channels, but also the eCommerce experience they offer to consumers.
Beauty and cosmetics eCommerce needs to move to the Edges: Introducing Edge Storefronts
What is shopping at the Edge?
Edge refers to an outside perimeter of an area. In the eCommerce context, this refers to the area that falls beyond your beauty and cosmetics brand’s website - this typically includes all the marketing channels such as social media, email, marketplaces and advertising platforms.
Learn more about shopping at the edge here.
What are eCommerce Edge Storefronts for beauty and apparel brands?
Let’s say you saw Hailey Beiber’s TikTok on a natural makeup look.
You’re absolutely smitten by how easy the look is to carry on a daily basis and want to immediately purchase the products she is using.
Traditionally, you will have to visit each of the brand’s websites, manually enter the product name (this is assuming the creator shared the exact names), search for an item, click to the product page and then decide if you want to make a purchase.
Having to move between so many web pages often leads to a loss of context in what we initially saw and were looking for.
Think about the number of times you take a screenshot from TikTok just to be able to recognise a product through its packaging!
The process is long, tiring, confusing and overwhelming - this for most consumers will lead to seeking another website to make the purchase from or stalling the idea of recreating Hailey’s makeup look.
Edge storefronts create a middle ground between these edges at which the consumer discovers your brand or its products and your online store - but without pushing them from the origin of discovery to your site.
Simply put, they do not require a consumer to leave the channel, visit your site and complete all those tiring steps to buy a concealer!
Edge storefronts are shopping experiences that blend content from the edge with the checkout process of your brand website.
So instead of taking the interested consumer to your brand site, you’re taking the site to them!
How do Edge Storefronts work and how are they different from landing pages?
Read this complete guide to understanding eCommerce Edge Storefronts.
What are the benefits of eCommerce edge storefronts for beauty and cosmetics brands?
Beauty and cosmetics brands can be seen diversifying their marketing and sales channels.
From simply selling through their online stores, you can now find them focusing on selling through social media platforms and online marketplaces as well.
So when brands are already becoming so diverse in their approach to reach consumers, why do you need eCommerce edge storefronts additionally?
TLDR; to connect the dots for the consumers.
But let’s look at some of the benefits in detail here:
1. Create contextual and engaging experiences
Beauty and cosmetics products are purchases that are often either driven by a specific need or are inspired by the content we consume. While brands focus on sharing content like ‘how to get a natural makeup look’ on social media, the traditional approach to leading buyers to purchases is often linking to separate product pages.
While each of these product pages are of the items used in the video, it requires the online shopper to move back and forth on the website to add them all to the cart. In addition to the same, the disconnect between the video they viewed vs the visuals they see on the website, often leads to a loss of context - they may either forget what they came looking for or be too overwhelmed to make a purchase decision, which instantly disengages them.
Edge storefronts are an all-in-one solution that makes social content fully shoppable - while retaining the trust and security that brand sites offer for making transactions. When the buyers see what they discovered on social media alongside the products used in the content, the engagement rate remains high.
2. Encourage impulse purchases
Think about how Rihanna’s Superbowl performance led to a spike in the foundation she used. That’s often how most beauty and cosmetics purchases are made by consumers - influence via content creators and influencers they look up to.
But imagine not having Rihanna promote your brand.
In that case, if what a consumer sees on a content creator’s account vs your website is even marginally different, you have lost the sale. The moment a consumer gets enough time to start wondering if the product will suit their skin, give the same makeup look or if they should explore other options, the ‘impulse buy’ factor is gone.
When almost six in ten consumers surveyed said they mainly bought beauty products online by impulse, we say Edge Storefronts are your hack to ensure the ‘impulse’ does not die!
3. Learn more about consumers
While Edge Storefronts don’t require a consumer to leave the social media platform, they are connected to your eCommerce site in the backend.
This allows you to capture customer data that like demographic, intent, interest and engagement rates across campaigns being run. Using this information, you can further improve your consumer personas and identify aspects that motivate them to make purchases from brands such as yours.
For example, did a video makeup tutorial lead them to add a product to the cart or was it a carousel on Instagram sharing the details of the ingredients used that won their trust before the purchase was made.
4. Boost product discovery
While edge storefronts might look like just another landing page for your campaigns, they actually replicate the experience of an entire online store.
This means that a consumer’s product discovery is not restricted to only the product being promoted. The storefront has all the elements that help them also discover related products on the site and explore other ranges of beauty and cosmetics products that may interest them.
As per our research, edge storefronts have the capability to increase product discovery by contextual customer engagement.
And the more a consumer discovers, the more you get to know them and the higher are the chances of them making a purchase.
Think about Sephora and how you keep adding products to cart as you walk down the aisle or browse through the deals on the website.
5. Reduce customer acquisition costs
When you know more about your customers, you are armed with information that can help you reach them with the right message at the right time.
The data captured through online shopper interaction on edge storefronts can help your beauty and cosmetics brand run better retargeting and remarketing campaigns.
And that has proven to help beauty and cosmetics brands reduce customer acquisition costs by almost 20%.
6. Create new revenue streams from the edge
As per a study by McKinsey, a brand’s ability to personalize shopping experiences as per consumer intent, interest and point of discovery, is what makes or breaks their success in driving sales.
As we mentioned in our previous article, comparing landing pages and edge storefronts, the latter is designed to handle different levels of intent and hence deliver a higher level of personalization.
eCommerce edge storefronts remove the hard landing that consumers experience from social media to the beauty and cosmetic brand’s website. While they still get to complete checkout on these storefronts, they are not “pushed” to do the same, helping you tailor their shopping journeys.
Can you build an eCommerce edge storefront for your beauty and cosmetics brand?
No code CMS like Shopify, BigCommerce, Wix and others, landing page builders like PageFly, GemPages, Webflow, etc and links in bio tools have become a popular choice for beauty and cosmetics brands to create online customer buyer journeys.
While the approach to enticing online shoppers, leading them to the website and the pages created using the above, from multiple channels of marketing is working to some extent, there is room for improvement.
And as per our research, the room for improvement is massive - from driving an average 3% conversion rate vs the potential to drive 97% conversion rate with eCommerce edge storefronts.
Google edge retail solutions and Google retail API have been talked about in the past by leading companies like Salesforce and Microsoft. But leveraging the technology has been far more complex a process for most.
After years of research and running experiments, SimplicityDX has launched Edge Storefronts for all beauty and cosmetics brands selling online.
Our technology has made setting up an Edge Storefront as easy as installing an app from your CMS - take for instance, a Shopify app for your online store or an added plugin to boost your conversion rate.
By simply integrating with your eCommerce CMS, we cover the massive gap between social edges and eCommerce to create connected customer shopping journeys online.
Want to learn more about Edge Storefronts and how they can help beauty and cosmetics brands succeed?