When it comes to keeping pace with changing consumer preferences, few retail industries have been as willing to take as many chances and make as many changes as beauty and cosmetics. From adopting bleeding-edge technologies to masterful personalization flourishes such as beauty bars and try-before-you-buy stations, the beauty industry is closely tracking what its customers are looking for when they walk through their doors, and have shifted their business to reflect that.
Business of Fashion editor Sarah Brown recently went in-depth in revealing how beauty’s knack for paying attention is seeing it thrive during difficult times for brick-and-mortar retailers. What follows are some of her observations about how beauty brands are leading the charge in understanding their customers, and designing their stores around what they really want.
The first customer touchpoint has changed.

It used to be a customer would walk into a store with a vague idea of what they wanted to buy, ultimately deciding while standing in the store, cash in hand. Upwards of 70% of buying decisions were made this way, according to Business of Fashion. With the rise of the information age, shoppers now have the power to conduct exhaustive research before deciding on a purchase, and most take advantage. According to an annual ‘How America Shops’ study by Wendy Liebmann, chief executive of consulting firm WSL Retail Strategy, 7 in 10 shoppers now “do some kind of pre-shopping” before setting foot inside a store, according to Business of Fashion. Among tech-savvy millennials, that number crests 90%, Monica Arnuado, senior vice president of merchandising at Ulta told Business of Fashion. This means that critical first touchpoint has gone from something that happens in the store to a sort of nebulous, neverending touchpoint that extends to a brand both online and off.

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Adding interactivity elements to physical spaces.

Everybody likes product samples. From free Vienna sausages at the grocery store to tiny-size sample bottles of detergent in the mail, it’s something most people find irresistible. That fact of human nature is reflected and capitalized upon by beauty brands, who have taken interactivity to the next level through innovative displays and experiences that can only be found in a physical store. Even mid-market brands like Target are adding beauty counters and makeup consultants to help advise customers, something higher-end beauty brands have done for years. Being doted on at a makeup counter while trying various shades makes the shopper feel important, and that little something extra really elevates the experience. The best e-commerce platform in the world can’t provide a pampering experience or physical interaction with its products. By harnessing the inherent advantages of physical space and using it in creative ways, retailers are capitalizing on assets online-only merchants lack.

Avoid putting customers into boxes.

Just because somebody enjoys the occasional champagne and caviar doesn’t mean they don’t also enjoy chowing down on a juicy burger. Today’s customer is after quality, but also bargain savvy. It’s entirely possible a shopper might regularly buy an inexpensive lipstick for daily wear but also occasionally splurge on something pricey. Beauty brands are seeking to cater to those dichotomous shopping preferences by carrying both high-end and affordable cosmetic brands, knowing their customers will often want both. Ulta spotted this trend nearly 30 years ago, according to Business of Fashion, and set out as a brand to offer an array of merchandise that reflects how shoppers really shop, which when it comes to beauty products, is very often on both ends on the price spectrum.

Knowing how shoppers want to shop.
Men and women have different shopping styles, particularly when it comes to beauty products. Failing to cater to those preferences eliminates potentially 50% of the market, so beauty brands are getting smart about it. One brand that took action upon seeing this trend was Target, according to Business of Fashion. Everything in their men’s section is planned with their target demographic’s needs in mind, down to the lighting and fixtures. Such design elements encourage men to feel right at home while browsing the store’s lines of skincare and shaving products, cologne, and even interact with grooming devices.
Keeping things fresh.
We live in an ephemeral world. That is especially felt in the world of beauty and fashion, where styles and designers can be considered haute couture one season and be totally forgotten by the next. This means brands need to be in a near-constant state of flux with their in-store layouts and products carried. To pull this off, stores have to be acutely aware of what merchandise is selling and what is sitting on the shelves untouched, and be prepared to frequently rearrange shelves and displays to reflect that. It’s no easy feat predicting the constantly shifting changes in what’s in demand, so it’s a perpetually moving target brands need to hit. Today’s customer is highly sensitive to staleness, so renewing the store design or aesthetic on a regular basis encourages customers to come back just to see what’s different. One road to success is monitoring social media to keep tabs on trends on their way out or emerging ones coming around the corner.
Understanding traffic patterns.
Human beings are creatures of habit, and many of those tendencies come out when we shop. For example, most shoppers in the U.S. will immediately walk to the right when entering a store, owing either to the large percentage of right-handed people or the fact that we drive on the right side of the road. Knowing that and staging a store interior accordingly makes it easy to guide shoppers past what you want them to see. Store layout is an important consideration in retail design. Ideally, customers are gently guided through the store past eye-catching displays or high-margin impulse items. It feels like a natural, continuous flow beginning at the front entrance and ending at the cash registers, hopefully with arms full of purchases. There are firms that specialize in studying retail traffic, and their reports help guide stores where to put everything from endcaps to cash registers. All of it matters, and designing a store in a way that goes with the natural current of shoppers’ habits.
Leverage the power of digital.

Shoppers are conditioned by online shopping to gravitate towards certain things. We like seeing reviews and buyer feedback for products we’re considering buying. We enjoy seeing celebrities we like or our friends giving their opinions on social media about the Next Big Thing. Some brands are recreating elements of that online experience in-store. Sephora features curated sets of products, such as “The Top 5 Mascaras” ranked and prominently displayed on its end-caps, which not only gets customers intrigued, but garners Sephora some product expert street cred, according to Business of Fashion. Social media has become a platform where a significant number of shoppers, particularly young shoppers, look to for trend cues. Those trends fade in and out of existence at a blistering pace, so consultancies who specialize in social media and influencers for brands are being retained to spot up- and-coming opportunities for products to carry or personalities to align themselves with.

Tell a story with your merchandising.
Customers are drawn to brands with a backstory, a mission or a heritage. It differentiates the experience from just another store to something that feels more alive. Making store displays feel like a living, breathing extension of that feeling and tell a story of their own is something beauty brands are particularly adept at. Store layout plays a part in this storytelling, as the front entrance could be equated with the opening pages of a story, which unfolds and unwinds with twists and turns along the way before culminating at the registers, the end of the story. It’s also important to pay attention to a customer’s own story. What drives them? What do they want out of life? What do they really need? Getting a handle on a customer’s story helps brands market and merchandise more effectively in a way that really resonates.
All brands are looking for the secret recipe to create that perfect in-store experience. Something memorable and buzzy that also feels genuine. Something the customer has never seen before yet somehow seems familiar. It’s interesting to see how different sectors approach this challenge, but the beauty industry is for sure an early leader in unraveling that mystery.

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