Placer.ai: Beauty Retailers Continue Success in 2022
A new white paper from retail data firm Placer.ai shows that beauty retailers are seeing success despite high inflation being persistent.
The report, Beauty’s Irresistible Allure, examined foot traffic at Ulta, Sephora, Target, Kohl’s and Sally Beauty, and showed that the beauty category is growing, fueled by Gen Z shoppers, shop-in-shops and more.
According to the new report, foot traffic at beauty retailers in 2022 was between 13.4% and 30.9% higher than it was in 2019, depending on the retailer. Year-over-year, beauty saw the highest increases in traffic in February (+23.8%) and April (+17.5%). Compared to 2019, traffic remained much higher throughout the year, peaking in April (+30.9%) and August (+28.5%).
Placer.ai credits a growing Gen Z consumer base as one of the major drivers of the increased traffic.
“Gen Z has become a major driver of the segment’s growth,” said Placer.ai. “Having grown up online and with many coming of age at the height of the pandemic, members of that demographic view beauty differently than their parents did. They prioritize self-care, self-expression, body positivity, and inclusivity over abstract, unattainable beauty ideals. And they are more likely to research a product’s specific ingredients or follow a favorite TikTok influencer than to focus on brand loyalty. Gen-Zers also place a growing emphasis on values-based shopping, embracing products that are cruelty-free, eco-friendly and produced by companies with ethical manufacturing practices.”
Beauty and retailer partnership seem to be paying off as well. Target/Ulta locations and Sephora/Kohl’s locations have both proved to be successful in attracting shoppers.
“During Q3 2022, for example, 14.5% of customers who shopped at a California Target with an Ulta shop-in-shop also visited an independent Ulta location – compared with just 10.8% of those who shopped at Target statewide,” said Placer.ai. “Similar trends can be observed in New York and Arizona. By increasing brand awareness and providing customers with a pleasant taste of what the chain has to offer, Ulta’s shop-in-shops appear to whet consumers’ appetites, building positive engagement and leaving them eager for more.”
The full report from Placer.ai can be found here.