Beauty shoppers are evolving fast, and so must businesses that want to stay competitive.
“We’re living through some of the most dynamic and disruptive periods in retail history — the rules are being written in real time,” said Jacqueline Flam Stokes, managing director of beauty and health at NielsenIQ, at the 2025 WWD LA Beauty Forum.
“Beauty is resilient, but it’s certainly not immune to the macro effects of the environment,” said Flam Stokes, adding that while the “lipstick index” — the longstanding theory that beauty sales grow during economic downturn — still holds true in certain respects, “this year, we’re seeing a real, tangible shift.”
Among the shifts at play: NielsenIQ data shows that for the first time, online sales have surpassed 50 percent of the beauty business, growing 18.7 percent year-over-year through August, while in-store sales remained relatively flat during the period.
“The convenience, choice and personalization of digital shopping have changed the way consumers discover and buy beauty,” said Flam Stokes, adding that “younger beauty shoppers, specifically, are over-indexing in stores.”
Amazon continues to see double-digit sales growth, with beauty sales on the e-commerce platform growing 22 percent versus the last 12 months. The growth can be seen across the board — from skin care to fragrance and beyond, and is “most notably at the expense of the direct-to-consumer, drug and mass channels,” Flam Stokes said.
Amazon has also reached 83 percent online beauty penetration, with 83 percent of people who have shopped for beauty online in the last year buying something during the July Amazon Prime Day Sale.
Furthermore, “the line between prestige and mass retail is now pretty much invisible — 99 percent of prestige beauty shoppers also buy beauty at mass retailers, and everyday categories like facial cleansers and shampoos are driving this crossover,” Flam Stokes said.
NielsenIQ surveys show just 14 percent of U.S. beauty consumers think pricier products work better; 68 percent of purchases made via social commerce platforms like TikTok Shop are impulse-driven, and 84 percent of shoppers report “having a good or even excellent experience on social [shopping] platforms — meaning they’re not going anywhere,” she said.
There are respective advantages driving performance at traditional retailers, though. For Ulta Beauty, those include the rewards program and accessible locations; at Sephora, exclusive brands are a key differentiator; at Target, breadth of assortment, and Walmart, “low prices, especially during this economic environment, are key,” Flam Stokes said.
Affluent shoppers also are increasingly investing in salon-quality at-home hair products, indicating one growing bright spot, while men, another growth driver, are “growing their basket sizes, making more frequent trips and repurchasing beauty products at rates that outpace the total [consumer] average,” Flam Stokes said.
For brands and retailers looking to keep pace with these shifts, “differentiate, personalize, diversify your strategy,” said Flam Stokes. “Make sure you are keeping your eye on the data, embrace the nuance and anticipate shopper changes, because we know beauty never stands still, and neither do shoppers.”
