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The Future of Beauty

By: Leslie Benson and Jeff Falk
Posted: October 9, 2008, from the October 2008 issue of GCI Magazine.

Look back on the size, shape and texture of the beauty industry in five-year increments, and among the things you notice are that trends can stay on the radar for quite awhile, sometimes really catching hold. We see, too, that the pace of change has picked up considerably. Change arises from what came before—new technologies enabling the next big things in their turn. All that has come before has brought us to where we are today, with a deeper understanding of both ingredient chemistries and the skin, leading to the most sophisticated products ever. Outside the lab, the world has kept pace, with a swiftly changing retail scene and a new way of doing business that is friendlier to the environment. GCI magazine editors take a look at the future of beauty being shaped today. It’s your move.

The Changing Face of Beauty Retail Puts Channel Distinctions into Soft Focus

Lines are beginning to blur between retail channels similar to the Magic Eye 3-D images so many tried to decipher in the 1990s by placing speckled pictures up to their noses. “The longer you look, the clearer the image becomes,” the brand’s Web site reveals, “and the farther away you hold the page, the deeper it becomes.” Just so, in the realm of beauty, the farther you look into the future of the industry, the clearer the reality becomes of retail channels—including food, beverages, nutrition and wellness, personal care, cosmetics and more—crossing visionary paths into one another to advance consumer experience, offering more convenient points of purchase.

As brands such as Coca-Cola and L’Oréal partner to develop functional beverages, retailers will have to find new ways of presenting such crossover products on the shelf. No longer will consumers look to high-end department stores for their exclusive beauty regimens.

In the next five years, according to Timothy Dowd, senior analyst in the Packaged Facts division of Marketresearch.com, the “Big Blur” will take shape. “It’s the overlapping of big retail channels as consumers shop at Sephora, Macy’s and Kroger,” he says.1 Supermarkets such as Kroger will become one-stop shops not only for groceries but also for private label health and beauty products; and hypermarkets such as Wal-Mart Supercenter and SuperTarget, combining supermarket and department store formats, will see a peak in sales, reflective of consumers’ reactions to economic downturn. And above all else, electronic sales through television and Internet retail channels will continue to flourish in the next five years as technology expands.

Preparing for 2012

Tesco is the fifth top retailer in the U.K.2 For the health and beauty segments, specifically, Boots follows closely as number eight, and The Body Shop sits at number 17. Interbrand cites one reason for this distinction as the birth of the hypermarket, which has “blurred the lines of channel relevance and forced consumers to think about choices.”