UK online beauty sales soar 53% during Covid-19 but future forecast much bleaker

Despite the coronavirus (Covid-19) pandemic forcing salons and spas to close, it hasn’t put clients off investing in beauty, with UK online sales of personal care products increasing by 53% over the past week (April 6–12, 2020), found data from analytics firm Contentsquare

This rise is part of an incredible overall 111% boost to the number of online beauty transactions since the start of the Covid-19 crisis in March, the report found. 

Online beauty retailers in the UK have also experienced a 38% increase in visits in the same April 6–12 time period, which has resulted in a 51% uplift in the amount of time being spent on their sites. 

“With so many countries going into lockdown and people being advised to say home, it would be easy to assume that consumers aren’t going to worry about their morning beauty routines. In fact, the opposite is true,” said Aimee Stone Munsell, chief marketing officer at Contentsquare. 

Is this the start of the “lipstick effect” in the UK?

The “lipstick effect” – when consumers spend money on small indulgences during economic downturns – is definitely happening in the UK at the moment, with consumers turning to all sorts of homecare products to keep their beauty rituals up.

According to data from market analyst The NPD Group, sales of prestige nail products online increased 12% in the week beginning March 16, 2020, which was when the general public were instructed to work from home if they could, as well as implement social distancing measures.

The week after (March 23, 2020), when all non-essential businesses were forced to close, sales of prestige nail products increased 24% compared to the same time period in 2019, the report found. 

Sales of base coats and top coats increased 102%, colour enamel 18% and nail care products 13% during this time, while pink, red and beige were the most popular lacquer shades. 

Consumers spent £23,000 online buying prestige nail colour (with an average price of £14.69) on the week starting March 23, 2020. 

“The increase in sales of nail products online… indicates that nail care could be the Covid-19 lipstick effect,” said Emma Fishwick, account manager for NPD UK beauty. 

“Consumers are increasingly turning to self-care and home-based beauty treatments like at-home manicures to improve wellbeing and boost their mood.” 

What will be the wider impact of Covid-19 on the global beauty market?

Despite many retailers currently experiencing an increase in online sales, the wider-reaching, future impact of the coronavirus pandemic on the beauty and personal care market is not looking as positive.

Market analyst Kline has forecasted that the US cosmetics and toiletries market is on track to experience the sharpest decline ever recorded in the past 60 years. 

Previously forecasted to grow at a CAGR (compound annual growth rate) of 3.8% through to 2023, Kline has now revised this forecast due to the unfolding coronavirus crisis, indicating a decline of 2.5% in 2020 as the most likely outcome, with the best-case scenario reflecting a 1.5% gain and the worst-case scenario an 8.1% drop. 

“Given the unprecedented situation that is unfolding globally as both a health crisis as well as a financial one, it’s not surprising that the beauty market should experience its worst performance now,” explained Carrie Mellage, vice president of Kline’s consumer products practice.

“Even our worst-case scenario of minus 8% probably does not feel steep enough given the dark days we are all living, but there are enough essential categories in the mix to keep the market stable.”

Kline’s forecasting analysis clusters beauty categories into four groups:

  1. Rescue categories – such as hand sanitisers and liquid hand soaps, which will experience spiked levels

  2. Everyday basics – items like shampoos and deodorants, which consumers are expected to more or less use as usual

  3. Soothing solutions – products such as facial skincare and nail polishes, which are expected to decline near term but may benefit from consumers turning to them as a treat and/or to maintain or establish a part of their routine they can still control

  4. Can-wait categories – these include fragrances and colour cosmetics, which are expected to decline sharply during social distancing of the health crisis and continue to suffer during the economic fallout in the years to come. 

“The cosmetics market will undoubtedly suffer in 2020 and in the years to come, but we expect it to recover within three to five years as it has in all past recessions,” added Mellage. 

“Compared to other industries, the beauty market is fairly recession-proof, and its products will continue to be desired by consumers – both for meeting basic needs as well as an indulgence.”  

Check out PB's coronavirus (Covid-19): support guide for beauty salons, spas and self-employed therapists.