Today, Amazon is among the most important retail channels in Beauty and a key opportunity for brands regardless of their specialty. Last quarter, the Beauty product group generated $950M in estimated sales in the US, an increase of over 26% compared to the same period in 2017. And in the UK, Beauty generated £45M in sales, a 47% YoY increase.

During Q2 2018, (see the first and second photos in the slider above) the Beauty product group reflected some notable changes in consumer habits. Some are seasonally-influenced, such as the strong sales of summer skin care products, while others suggest a long-term shift in how people shop, such as Amazon’s growing share of the Luxury Beauty market.

In both the US and the UK, Mass Skin Care is the long-standing top category in the Beauty product group. Though the overall size and growth of Skin Care is strong year-round, the category is highly susceptible to seasonal conditions. In the UK, the category is dominated by established leading brands Riemann and Nivea respectively. In America, the Neutrogena brand is #1, but coming in at #2 is Elta MD with their line of “clinical strength” sunscreen and skin care products exhibiting significant growth.

A key emerging trend is the environmentally-conscious, value-driven shopping – for example, in both the US and the UK, “reef safe” is now one of the 50 most popular terms for shoppers searching for sunscreens, whereas in 2017 it was virtually non-existent. In the US, this has resulted in “reef safe” products taking up the top sunscreen rankings, and shoppers on Amazon.co.uk are searching for reef safe sunscreens just as frequently.

While mass market beauty products have had success online since the very beginning of eCommerce, consumers were originally reticent to purchase high-tier products through Amazon. Today, that is no longer true. Shoppers are willing to spend more for high-end products online, driving the Luxury Beauty category to grow at a YoY rate of 57% in the US.

The growth potential in Skin Care and Luxury Beauty for brands on Amazon is impressive. The eCommerce giant continues to capture the flow of consumers away from in-store shopping and, quarter after quarter, those consumers are willing to spend more on Amazon to get higher quality specialized goods tailored to their specific needs, desires and values. The Beauty brands that adopt an Amazon-first strategy will capitalize as Amazon continues to strengthen its role in this space.

ABOUT THE AUTHOR

Pete Andrews is the director of insights at One Click Retail focused on driving clients’ eCommerce business forward through data. Pete has spent over 8+ years in retail working at both Amazon and Sears Holdings in both vendor management and analytics roles.