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by Erica L. O’Grady CAE, CEO, Society of Cosmetic Chemists

Founded in 1945 and celebrating its 75th Anniversary this year, the SCC is the oldest and largest non-profit organization serving the cosmetics and personal care industry.  Dedicated to the advancement of cosmetic science, SCC headquarters provides unparalleled education, resources and networking for more nearly 6,000 members globally and via 19 chapters across North America. Visit www.scconline.org for more information. 

Covid 19 in beauty industry: disruption, adaptation and growth

The global economic impact caused by the pandemic has affected every sector of the cosmetics and personal care industry.  From manufacturing to formulation and R&D to packaging, every aspect of the product development and production life-cycles has been disrupted.

Cosmetic Chemist

The beauty industry has taken a hard hit in the first six months of this year due to nearly nationwide shelter-in-place orders and mandated shut-down of brick and mortar retailers.  Many consumers turned to in-home care routines since they had no access to professional services and tried less expensive alternatives available at “essential” retailers or online retailers, whether for convenience, access, or price. 

For example, with salons closed, hair color sales soared nearly 115% according to ResearchAndMarkets.com, and the full personal care category (skin, hair, nails) is up 300% as estimated by Zalando, Europe’s largest fashion and lifestyle e-commerce marketplace.  These trends are likely to continue in the near-term, even as countries reopen.

Color cosmetics, fragrance and luxury brands seem to be taking the hardest hit for several reasons: 

  • global supply chain disruptions;
  • consumer decrease in use of cosmetics/fragrance; 
  • personal economic hardships around the globe.
Turning the economic challenges into new beauty opportunities

While makeup sales are down, and likely to stay that way with face-covering requirements in many areas, personal care products won’t likely see such a sharp decline.  And the demand for green/sustainable personal care products continues to rise across the board, with consumers equating their health with the health of the planet.

Brick and mortar stores who had a robust online presence and consumer-friendly site fared slightly better, but online sales were not enough to offset in-store sales – where nearly 80% of initial beauty & personal care decisions to purchase are made. 

beauty cosmetics chemists
Beauty – an integral part of self-care and well-being

Despite the bleak outlook in some sectors, there are near-term opportunities.  Since beauty is an integral part of self-care and perceived well-being, companies can capitalize on this by improving product innovation strategies, accelerating time-to-market, and creating innovative DIY-brands that perform well at home and are reasonably priced.  And don’t forget the demand for green/sustainable beauty.  The consumer’s digital experience, from online ordering to the use of artificial intelligence in customization of beauty, offers brands a unique opportunity to benefit from growing trends of increased online engagement and spending for the foreseeable future.

Shifts in beauty product development, marketing and sales strategies

Many companies, both large and small, shifted their focus to develop and manufacture cleaners, sanitizers, and other critical hygiene products and PPE; and while their efforts were necessary, many of these companies are now having to furlough or lay-off employees to stay afloat.  Smart, forward-looking shifts in their strategies – for some that may mean price; for others, it may mean direct-to-consumer marketing – may be able to turn the tide of ebbing profits until this global health crisis and consumer economic concerns subside.

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