Cost-of-living crisis driving an era of financially inclusive beauty, new report by Beauty Pie shows
- Whilst fifteen of the leading beauty brands are sourcing products from the same three manufacturers[1], post-manufacturing markups are leading to wildly varying retail pricing
- As the economic downturn puts continued pressure on household spending, consumers are turning to brands that provide fairness around efficacy, pricing and create communities
- Beauty Pie lay bare what products really cost to make versus what customers eventually paid for them
- A generation of hyper-knowledgeable consumers are demanding more openness around supply chain ethics, carbon footprint and financial inclusivity in the growing cost of living and climate crises
- We are experiencing the rise of 'Beautility', where product efficacy and meaningful engagement are favoured by consumers seeking to derive value and personal transformation from every touchpoint
- The beauty industry is embracing radical fairness across everything from price points to product efficacy
NEW YORK, Oct. 5, 2022 /PRNewswire/ -- The beauty industry will undergo a fundamental shift throughout the cost-of-living crisis as consumers demand fairer pricing, greater product efficacy and more open and honest business models than ever before, reveals a new report by beauty buyers club Beauty Pie.
The Beauty Futures 2025: Beauty, Beautility and the Rise of the 'Question Everything' Economy report, released today in partnership with The Future Laboratory, argues that a period of financial uncertainty, increased free time during the pandemic and greater access to information has created a generation of hyper-knowledgeable consumers expecting brands to provide more honesty about their products - from efficacy to supply chain.
The cost-of-living crisis is driving a demand for radical fairness and financial inclusion in the beauty industry
Whilst fifteen of the leading beauty brands source products from the same three manufacturers, hyper inflated markups are causing many to pay higher prices for products with the same base ingredients. As people continue to re-evaluate their spending habits and become more knowledgeable about these varying cost structures, there will be new demand for radical fairness in the industry across everything from price point to product efficacy as people become more aware of these markups. This shift will fundamentally change associations of higher price being linked to quality, placing more pressure on brands to prioritise shared values and demonstrate fairness and functionality.
Marcia Kilgore, founder, Beauty Pie, says "Why is it still an industry that does things the 'traditional' way? Why perpetuate the myth that people want to buy into the mystique of beauty; the smoke and mirrors, rather than the glorious revelations of the ingredients, technology and artistry? Why is it okay still to be paying crazy retailer markups, and not even know that the stuff you're actually paying for – might only cost a tenth of the price to make and manufacture?"
A new generation of hyper-knowledgeable consumers expect greater clarity on ingredients and product efficacy
Now armed with a wealth of information, consumers are no longer looking to be 'sold' a product, but are instead demanding the facts – namely ingredients and proof of product effectiveness – speak for themselves. As consumers become better educated, they are approaching products with the same eye that they bring to their nutritional choices by focusing on base ingredients, their scientific benefits and where they are sourced. As a result, searches for ingredients climbed by around 229%[2] in 2021.
Customers are more likely to listen to their community than a CEO
The combined impact of influencer saturation and the growth of digital communities through the pandemic has led to an increased focus on community-led beauty, seeing people turn to their peers for recommendations on products. Whilst just 49% of people currently report a high level of trust in CEOs, more than 62% look to people in their community[3], forcing brands to consider how they can build more meaningful connections with their customers and provide more value. Where direct to consumer (DTC) models are already building longer term connections with customers, many will be turning to memberships to build highly interactive digital communities and create valuable interactions. As a result, it is expected that 75% of DTC brands will have a membership-based offering by 2023[4].
"We commissioned this report to explore the evolving attitudes to luxury and fairness, and the growing consumer instinct to be part of something bigger – and to see if our instinct that overpaying is officially over is correct" says Marcia Kilgore, founder of Beauty Pie. "The Beauty Futures 2025: Beauty, Beautility and the Rise of the 'Question Everything' Economy report shows how this will create new challenges for future facing brands, but also exciting opportunities to create a more honest, open and fair industry.
The Future Laboratory's co-founder Chris Sanderson says: "Across generations and across the world, people are now looking for experiences, services and products that help them become better versions of themselves. This mission to be healthier, wealthier and happier is leading to the rise of the transformation economy, putting new demands on brands to deliver more meaning to their customers."
You can view the full report, here: https://www.beautypie.com/blog/posts/beauty-futures-2025
ABOUT BEAUTY PIE
Beauty Pie is a game-changing premium beauty and wellness company that works directly with the world's best beauty labs to create exceptional, award-winning skincare, makeup, hair and body care, fragrance, candles, supplements and more. It's also a club you can join, so that you can buy each deluxe, high-performance product at up to 70% what you'd expect to pay at typical beauty retail. Founder, beauty expert and serial entrepreneur, Marcia Kilgore, launched Beauty Pie in 2016 with the twin purpose of both making exceptional beauty products, and also opening up a wider conversation around whether the beauty industry – one that professes to want to empower (especially) women – was really taking advantage of them. Which is why at Beauty Pie we have a saying: the old beauty industry cuts you out. We cut you in."
@BEAUTYPIE
[1] Jungle Scout and Fashion Edits
[2] The Hut Group
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SOURCE Beauty Pie
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