Will amazon give it a makeover?
It is rumoured that the next step for the e-commerce giant could be a shock to the beauty industry. But how scared are players like sephora and Ulta?
According to 1010 data, this time, the retail thought leaders are focus on the beautiful, amazon’s market share in the United States has amounted to 21.1%, and 17.4% of the macy’s and 15% of the sephora. The choice is not surprising, especially given the recent success of retailers. According to an amazon spokeswoman, the company has noted that users have been looking for beauty keywords and brands that have not yet been sold on e-commerce sites.
A spokesman in an email to retail diving, said: “now that we know that the customer is super engagement, and hope to find these products on amazon, we will work to increase by choosing to please her and innovation.”
Amazon has a tendency to enter any and all markets, from sportswear to footwear, and to the fear of god hitting retailers running in this space. The company ventured into the grocery store last year, buying Whole Foods, transforming the minds of many retailers and announcing that amazon was intent on becoming a real threat to its competitors. A similar move in the beauty world may have a serious impact, but now beauty is a different animal.
Amazon’s current beauty products well collected replenishment shoppers, but if without the support of the entity shop, the influence of the company may be limited – in this regard, amazon against sephora and ur tower such major retailers, they are all good good online and off, start to participate in the store experience, and provide compelling loyalty programs.
Everyone on the table has room.
Unlike many retail categories, beauty and customers are almost universal. Beautiful baby sephora is the queen of the experience of the store have a beauty shop store and in-store augmented reality function, not to mention an exclusive community feeling, only members enjoy special social platform.
“If you’re constantly innovating, somehow – I don’t necessarily say you’re bulletproof, but you can prove yourself in this lower cycle.
And then Ulta. The beauty giant’s online sales grew 63 percent in the third quarter, and some speculated that its success could lead to another major player’s acquisition (hint: amazon or wal-mart). But even in all the competition in the beauty world, these retailers are thriving, in part because of these other forces.
“Everyone is affected by demand volatility,” said Hana ben-shabat, a Retail partner AT AT Kearney global management consulting, who told Retail Dive earlier this month. You’re constantly innovating, you’re somehow — I don’t have to say bulletproof yourself — but you prove yourself in these lower cycles.
The e-commerce giant, for its part, can’t compare with other beauty brands in terms of in-store experience and technology. Has focused on the department to buy the product before the trial products provide technical enhancement solution, l ‘oreal and estee lauder hire new CIO in October, the former also use AR makeup training in December.
Lancome in strengthen the function of moving a virtual try on October (sephora has a years), and MAC cosmetics company has just launched a store AR mirror – experience heavy function, amazon will find it difficult to deprive them of the company HTML text behind walls.
“It’s a $450 billion industry, and if you’re a giant like amazon, it’s hard to ignore, but I don’t see it now, and it’s not.
This is not to say that the innovation of the amazon’s mobile applications cannot make up for the bad influence of large retailers, and help customers more determined to buy cosmetics online, but in Sephora (Sephora) or Ulta shopping experience element can keep these retailers against amazon.
ObjectWave digital strategy and service company founder and CEO of Sam Cinquegrani tell Retail Dive: “as long as these retailers continue to [innovation], I don’t think amazon really have a chance to break into the industry. “It’s a $450 billion industry, and if you’re a giant like amazon, it’s hard to ignore, but I don’t see it now, and it’s not.
Amazon takes what amazon wants.
As we’ve seen over and over again, all this requires amazon to commit to a category of full force. The voice assistant market actually belongs to amazon, which collects up to 75% of the market and publishes new Alexa partners and partners almost every week.
There’s nothing to say. Beauty can’t happen. According to digital insights L2 data, 25% of the sephora brand has officially appear on the amazon, which means that they showed obvious growth in traction, e-commerce giant when replenishment on beauty retailer pose a serious threat. L2 beauty Chelsea Gross, associate director of the company’s customer strategy (Chelsea Gross) in the study of three top skin care products, said 20% of customers first encountered the products in other places, then came to the amazon to buy again.
“Replenishment customers are ultimately the most valuable customers for our beauty brand,” Mr. Gross said, noting that the beauty brands that moved to amazon were mainly for better profit margins. “So they may have invested all their investments in sephora’s findings, but in the end they will lose a third party to amazon.”
Amazon is a threat, but physical beauty retailers are not in imminent danger. They do enough in-store experience to win loyal customers. If amazon wants to enter the field in a big way, then acquisitions are the most likely way – and the whole food company offers a perfect precedent, Cinquegrani says.
But before that, amazon faced an “uphill battle,” Cinquegrani said. At the end of the day, amazon is an e-commerce company, and beauty is a highly tactile category. More traditional retailers may not have much to worry about until retailers decide to prioritise beauty.
“It continues to make [amazon] a one-stop shop.”