Among the many changes to consumer behaviour seen in recent months is the rise of comparison shopping – and this has become problematic for prestige beauty brands, which are losing out to cheaper alternatives considered to be just as effective.
Homebound consumers are increasingly browsing and researching online, and in these uncertain times are also more careful about their spending.
And with the internet making it possible to compare ingredients across brands, social media influencers are happy to point out if there is little difference, beyond the packaging, between high-end brands and their drugstore counterparts.
According to the Business of Fashion, that is why brands like CeraVe, The Ordinary and The Inkey List are becoming increasingly popular in the skincare sector – and the ingredient-first approach of many influencers, rather than traditional branding, is a key reason for their success alongside the lower price.
“My clients now really track these mass brands,” said Marjolein Jonker, a consumer practice manager at Kearney, the management consultants. “A few years ago, that would have not even been a topic.”
She added that luxury labels now must adapt to a new reality where consumers are turning to drugstore brands and mixing high and low, with the middle of the prestige market the most affected.
For example, a consumer who typically bought moisturiser costing $65 is more likely to trade down to a drugstore brand if the formulas are comparable.
“Luxury brands are still there and have a legacy, but they’re slightly threatened by the fact that the consumer is more sophisticated and really wants to understand the reason why they need to pay a premium,” said Charles Rosier, co-founder and CEO of Augustinus Bader Skincare.
In that sense, consumer habits have shifted towards more “real” user-generated marketing content and value-driven products with active ingredients at the top of the list, the Business of Fashion concluded.
Sourced from Business of Fashion