Amazon Premium Beauty: Now, Next, and Why It's The Key

THE STATE OF AMAZON PREMIUM BEAUTY      

Despite traditional mass retailers like Walmart and Target increasing their foothold in the online beauty space in recent years, Amazon remains the most popular online destination for beauty shoppers. Stella’s longtime beauty shopping survey shows that 75% of consumers shop beauty on Amazon, followed by Sephora.com (63%), Ulta.com (60%), and Walmart.com (54%). Looking specifically at the luxury segment of the beauty category, Amazon is the #1 e-tailer for Prestige Beauty and leads other retailers in all beauty performance, with Premium Beauty growth outperforming Mass at +29% vs +18%.[1] Through discussions with our research community, Glimmer, we know that online beauty users choose Amazon for its convenience, flexibility, and pricing; they can purchase their LANEIGE Lip Sleeping Mask and household essentials in one fell swoop, knowing that they secured the best price on both. It’s easy to understand the allure of Amazon for online beauty shoppers, but what about the brands that have made it a part of their holistic retail strategy?

AMAZON COMPLEMENTS YOUR OMNICHANNEL STRATEGY

The skepticism and resistance toward Amazon as a legitimate beauty retail destination has dissipated considerably over the years, in large part due to the continued growth of its Premium Beauty category. Our 2024 Deep Dive into Beauty Buying report highlighted that 86% of beauty users shop online and in-store, underscoring the importance of meeting consumers where they are. When partnering with our premium beauty clients, we stress the importance of approaching Amazon as a complement to their omnichannel strategy, as the channel can serve many purposes. In addition to providing convenience and a best-price guarantee, Amazon aids in brand and product discovery and is a powerful research and education tool. Amazon’s countless customer questions and AI-enhanced product review summaries make it easier than ever for users to compare products and make an informed purchasing decision. For those who embrace it, Amazon also serves as a continuation of the DTC experience, with branded content including images, videos, enhanced product descriptions, and brand stores that promote brand saliency and consistency across online retail platforms.

To address concerns over DTC cannibalization, brands can now tap into advanced measurement solutions like Amazon Marketing Cloud (AMC) to determine the platform’s incrementality and overlap with DTC shoppers. AMC also provides brands with a deep understanding of their Amazon consumers via rich customer insights, which allow brands to tailor their approach to reach unique audiences.

I can say with absolute certainty that Amazon will continue to develop analytics tools, further enhancing its suite of brand services and making it harder than ever to turn a blind eye to the marketplace. Even long-time Amazon hold-out The Estee Lauder Companies Inc. has changed its tune, launching its brand Clinique on the U.S. Premium Beauty store in April and Too Faced in June, and signaling a new day for online beauty retail. Expect to see legacy and up-and-coming prestige beauty brands enter the marketplace with a new sense of urgency in the coming months. If you are one of them, do not underestimate the importance of a strategic, intentional brand launch—a feat that our partner Keys Soulcare executed brilliantly earlier this year.

KEYS TO SUCCESS

On January 17^th, 2024, Keys Soulcare went live on Amazon, setting a new standard for Premium Beauty brand launches. The lifestyle beauty brand created by Grammy and Tony-award winning artist Alicia Keys partnered with Stella Rising and Amazon to deliver a bold, disruptive launch. Every element of the launch was given thoughtful consideration. From product detail pages to advertising creatives to the brand store experience, no detail was overlooked. Brands considering launching on Amazon, take note: this is what took Keys Soulcare’s launch to the next level:

• Fully optimized detail pages, including SEO-driven content, curated image + video carousel, virtual-try-on mobile experience, strategic product pairings, and enhanced brand story and product description
• Intentional product assortment, including an Amazon-exclusive offering—the Deeply Replenishing Squalane Facial Oil
• Premium brand store experience, with user-friendly navigation, a curated “About Us” page to fuel brand education, and an interactive Offering Selector to drive product discovery
• Full-funnel on-site advertising strategy with campaign activations across Sponsored Ads and the Amazon DSP, plus upper-funnel with Streaming TV, and Prime Video Ads
• External support via email marketing, social media (Keys Soulcare and Alicia Keys), press, and PR to generate excitement and awareness and connect with their community
• An hour-long shoppable Amazon Livestream with the Goddess-In-Chief herself, Alicia Keys, to introduce the new “Get Ready with Soul” campaign

Of the launch, Rina Yashayeva, Senior Director of Amazon at e.l.f. Beauty remarked, "Recognizing the growth potential within Amazon Premium Beauty, we proudly introduced Keys Soulcare to the Amazon community. Partnering with Stella Rising was the perfect choice to amplify our presence and shine at full wattage on Amazon.”

EMBRACE THE MARKETPLACE

Experts predict that this year Amazon’s beauty sales will grow faster than the overall market across nearly every subcategory; it’s safe to say Amazon’s foothold in online beauty retail is here to stay. Brands that treat Amazon as a complement rather than a threat to their holistic retail strategy can tap into advanced measurement solutions to better understand their customers and drive incrementality; these are the types of advantages to consider if your brand remains unconvinced.

Another step for brands still considering: search for your products on Amazon. There’s a very good chance that your brand already has a presence on the marketplace via listings from unauthorized sellers who won’t protect your brand. A strategic, intentional Amazon launch secures ownership of your brand’s voice and promotes omnichannel growth. When you’re ready to launch, we’re here to support.

[1] NielsenIQ