Can’t touch this: cleaning up cosmetics

In a climate of anxiety and changing consumer behaviour, the smart retailers and brands are rapidly rethinking their manufacturing, instore and online strategies, as Australian consumers clamour for brands and retailers that deliver on trust and hygiene. 

Amid travel bans, stockpiling of FMCG basics plus a rapidly growing local anxiety in light of the COVID-19 pandemic, brands and retailers are grappling with the new reality of panic buying and germ phobia.

At a manufacturing level, brands are facing the need to address product purity and hygiene in the same way they once declared lists of ingredients. Packaging and source transparency will be key as consumers will demand to know where goods are imported from and details on the origin, packing location and warehousing of the products being offered.

Already, consumers have raided stores for what they believe to be crisis essentials. However, once our perceived urgent need for a lifetime supply of hand sanitisers and toilet paper is met, consumers will turn their attention to little luxuries and day-to-day consumables, so brands and retailers will need to be ready.

At a retail level, store design, traffic flow and the role of staff will need to change. Retailers should be asking themselves:

  • How do we handle crowds within the retail environment when human contact is a perceived risk?
  • What changes are required in store design and user experience?
  • How do we serve customers and maintain our staff safety?
  • Do we provide testers for products such as cosmetics, or will we need to switch to digital and virtual reality solutions for the consumer to “trial” and “learn” about the product instore without compromising hygiene?
  • What will be the role of technology in a post COVID-19 world where consumers have heightened anxiety around human contact and demand trustworthy and transparent information?

My background is the cosmetics industry and this is a high-touch, experiential business. Men and women want to touch, smell and try on products before they make a purchase instore; but with the absence of testers and inability to open what I assume will morph into heavily sealed goods, will they still come into stores? The answer is yes, but with some major changes to how we shop.

One natural evolution will be that retailers will need to quickly upgrade their digital offer, and do more to promote and drive transactions and education via online portals.

The question is how well equipped are they to serve this increase in digital demand?

I’ve been in the beauty industry for over 25 years. I’ve worked on cosmetics counters as a university student, was brand general manager for Bobbi Brown and Origins at the Esteé Lauder Group, imported and distributed 36 brands via my first business Brandmakers supplying department stores, pharmacy, discount retail and specialty retailers, and I know from experience that retail is about theatre, experience and touch.  The rules for retail have changed, and retailers need a plan B fast!

Plan B is going to rely heavily on digital – digital media, digital supply and digital service touch points that replicate or bypass the retail experience. Some brands will need to wean themselves off the Chinese customer and face a future (at least in the short term) of largely Australian consumers. For these brands and retailers, investing in media, influencers, ambassadors and initiatives that are locally targeted will be key. Best-practice retailers are already expanding their digital solutions to help drive traffic to online stores and help educate their audience on newness, news and brand messaging via digital platforms both at store and online. Think touchpads, targeted ad serving, segmented database marketing and video content.

Fifteen years ago I launched Australia’s first distributor-owned online beauty store, RESCU Beauty Bar. We take this for granted now, but the time it was risqué and somewhat arrogant to assume that removing the touch and physical experience element of shopping for beauty products could work. Testers were replaced with samples, application and playing with product replaced with digital colour swatches, and customer reviews and trial teams replaced with sales representatives. It was slow to take off at the time, and I remember the CEO of one of my retail partners laughing at me, but now it’s the norm and certainly expected by most customers.

Investment in new tech, virtual and augmented reality is now imperative for both the retail and online. Virtual reality apps are transforming the digital experience and boosting sales for brands such as Clinique, which has a number of online tools to help colour match foundation, select correct skincare and even find the right lipstick shades for your skin tone. L’Oréal MakeUpGenius app was a groundbreaker, using virtual reality to try on make up and have a complete makeover without any human contact. Australian innovator SkinDNA offers custom skin analysis and online product recommendations based on a DNA swab you can post in. Zero store contact!

In the beauty industry, there is a high probability that, with the rapid decline in sales, particularly for premium brands, impacted further by the absence of the high-spending Chinese consumer and tourist dollar from border closures, brands and retailers will face dramatic cutbacks in staffing and marketing spend.

Brands are reporting plans to increase presence of tech both on the retail floor (screens and apps replacing sales consultants, online portals for customers to see demonstrations and learn more about what they have purchased and scan technology to learn about products and recommendations in the aisles) and enhanced e-commerce experiences (shop via social media, YouTube and online), all of which is currently available and relatively easy to add into most business models.

Sephora took a brave and leadership stand to cancel make up services in early February, and this is a very real possibility in all other retail outlets before the end of March.

Online education is another digital workaround for retailers and brands as they use digital platforms to train staff and create training and demonstration modules via video and online, eliminating the need to attend conferences, training sessions and even expos.

The only way to survive and thrive is to adapt, evolve and be ready to admit the past is no longer a relevant benchmark for future success. 

While this may appear terrifying to old-school retailers and brand custodians, the new economy and wave of entrepreneurs will see this time as a unique and exciting opportunity to evolve the retail experience (online and instore) and most likely improve profitability.

The best and brightest retailers and marketing managers are planning meaningful offers that build trust and loyalty with their brand. They are planning activities and offering incentives for customers to shop online with the same frequency and spend as they may have done instore, or indeed return to retail and re-discover the experience in modern ways. 

Human behaviour adapts and evolves and even in times of war and crisis, the lipstick index holds steadfast. So as retailers and brands, anything we can do to help hold the hand of our customers during this period of high anxiety and change will lead us to success.

Delivering trustworthy, transparent and helpful information will be key. It doesn’t even have to be perfect.

Bahar Etminan is the author of RESCU Me! A makeover guide for a life more fabulous and publisher of women’s lifestyle site www.RESCU.com.au. This article was published in the April issue of Inside FMCG magazine. Subscribe here for in-depth analysis, features and interviews with leaders in FMCG.

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