Top global beauty corporations have been acquiring emerging independent brands at breakneck speed. According to an investment firm brief on the beauty industry, M&A activity in the beauty sector continued to show strength in the third quarter of 2015 with 23 deals, bringing the total deal count to 64 year-to-date, and they project the trend to continue in 2016.
For beauty analysts and trend watchers, it’s no surprise that indie brands are considered the future of the industry—these niche, boutique brands embody everything that Millennial women want in consumer products. Here, we take a look at the key reasons indie brands are altering the dynamic and culture of the beauty industry.
Indies make their story part of their brand
Indie brands build a foundation of trust with their fans through storytelling, staying true to their mission, and engaging in authentic, two-way communication with their customers. Many of the most successful indie brands put the brand founder in the spotlight and invite the consumer to become part of the story through social media interactions and campaigns.
Social. Social. Social.
Historically, it was difficult for emerging brands to break through—they didn’t have the budgets to advertise on the same scale as major brands. But earned media on social and digital activation has leveled the playing field. Independent brands have been able to effectively market themselves through Instagram, YouTube, Facebook, Pinterest, and Twitter.
Consumers want natural options
Research shows that 49% of Millennial women would choose organic cosmetic, skin, and hair products when given the choice. Additionally, 44% prefer to buy eco-friendly personal care items. Many indie brands offer consumers that choice with small batch, naturally formulated, and sustainable product options and packaging.
Indie brands offer customizable solutions
Consumers want to customize products to meet their needs—for example, the ability to formulate their own fragrance or have control over the amount of coverage foundation make-up provides. Consumers have a heightened interest in a personalized approach to beauty and in their choice of beauty products. This is opening the door to brands that have a specific, fine-tuned beauty focus, whether eye brow expertise or targeted solutions for specialized skin concerns, rather than more generalized expertise in a broader category, like makeup or skincare.
They want something unique
With their innovative, value-oriented products, indie brands are in an idea position to tap into the Millennial consumer’s desire for something new and unique. Intriguing colors, covetable packaging, and out-of-the-box delivery systems appeal to Millennial women.
Independent brands have significantly increased their visibility and will continue to be sought-after acquisition targets by major cosmetics giants and private equity firms. Women’s Marketing offers unparalleled experience as brand-builders in the beauty industry. Learn how we can leverage our expertise to take your brand to the next level.
Sources: Intrepid Investment Bankers Beauty Care M&A Report, Q3 2015, Buzz Marketing The Millennial Beauty Consumer