Long before COVID-19 altered the retail landscape for the foreseeable future if not forever, the shift from brick-and-mortar retail to e-commerce was undeniably tectonic and had been underway for years. With the digital world comes a unique set of challenges for beauty products, which have traditionally been tested and purchased in-person.
According to NPD, 5 in 10 makeup and skincare users purchase online. The question for the beauty industry is how to effectively and efficiently reach and sample consumers via digital commerce. Arcade Beauty is uniquely positioned to help beauty brands do so. The solutions are two-fold: First, samples and mini products can be leveraged in saleable discovery sets through e-commerce, offering an entry price point ideal for customers to buy and try at home before committing to the full size. In addition to samples, we are devoting significant resources to designing, developing, and manufacturing mini products as it’s an area of significant growth. After all, according to NPD, US prestige beauty is seeing growth in makeup minis August YTD, with mini concealer +17%, tinted moisturizer >+100%, and foundations +10%.
Second, digital channels allow us to target high-value customers. Arcade Beauty launched an intelligent self-service digital sampling business called Abeo. With our digital solutions, brands have the ability to meet consumers wherever they are. We offer best-in-class turnkey, customizable sampling solutions for brands seeking to acquire new consumers as well as activate and grow their existing consumer base. With our end-to-end solution; from manufacturing to campaign execution to data and analytics, we seamlessly connect sampling innovation with audience activation. Through it all, brands can gather qualitative and quantitative insights, as well as measure and track ROI based on actionable data.
Abeo campaigns can be activated through social platforms, digital publications, and now streaming platforms. Our brand partners can activate consumers through social platforms like TikTok, Pinterest, Facebook, or Instagram, and Snapchat. In addition, we are thrilled to announce our recent partnership with Spotify! An ad for a product pops up when a customer is listening to music and can request a sample directly through their phone.
Online sales now represent close to half of US prestige beauty industry volume, at 46% share August YTD. This is 2 times larger vs. 2019.