Ecommerce could have roots all the best way again to 1969, however there’s little doubt that the final two years have utterly remodeled the world of on-line purchasing.
In 2022, world retail ecommerce gross sales are projected to surpass $5 trillion for the primary time, and by 2023, digital gross sales are anticipated to achieve 22% of world retail gross sales, in comparison with simply 14% in 2019 — which matches to indicate that ecommerce is not a rarity, however a norm.
Within the age of Amazon and a fading pandemic, there are few issues you’ll be able to’t purchase on-line. Vogue attire, electronics, digital merchandise and even groceries are only a few of the most well-liked on-line purchasing classes.
Following within the footsteps of our World Ecommerce Report on vogue and apparel, for BigCommerce’s second trade pattern report, we’ve determined to look at one other purchasing class that’s poised for large progress: well being and sweetness.
Based on Statista, world ecommerce gross sales within the well being and sweetness class are projected to achieve $449.6 billion by 2027, and Insider Intelligence forecasts U.S. cosmetics and sweetness retail ecommerce gross sales in 2022 will probably be greater than double these of 2019. Our information exhibits the well being and sweetness class is poised for progress if the developments of the primary half of 2022 stay fixed or enhance.
Learn on for extra insights into the state of well being and sweetness ecommerce to this point in 2022 from BigCommerce and our retailers.
Methodology
BigCommerce’s well being and sweetness information is sourced instantly from our retailers and was pulled on August 23, 2022. All information is world and pertains to all nations the place BigCommerce retailers do enterprise, until in any other case famous.
All comparisons are congruent comparisons between the identical variety of current shops relationship again to the earliest interval used within the comparability. For instance, a comparability between the primary half (H1) of 2021 and H1 2022 would use information solely from BigCommerce shops that existed in H1 2021, until in any other case famous.
How the Well being and Magnificence Business is Performing in 2022
In H1 2022, we noticed a 12% enhance in gross merchandise quantity (GMV) for well being and sweetness retailers in comparison with H1 2021. The identical progress held true for well being and sweetness’s orders, which noticed an 11% enhance between H1 2021 and H1 2022.
Nonetheless, year-over-year (YoY) common order worth (AOV) for the wholesome and sweetness class didn’t comply with this identical sample, with AOV remaining comparatively flat from 2021 to 2022.
Social platforms stay a dominant gross sales channel.
With the U.S. social ecommerce market anticipated to surpass $50 billion yearly by 2023, it’s no shock that social media stays a number one gross sales channel for well being and sweetness manufacturers.
Evaluating 2022 to 2021, well being and sweetness retailers promoting on each Fb and Instagram noticed an 83% enhance in H1 for YoY GMV. YoY orders, these retailers skilled a rise of 140% in H1, whereas YoY AOV decreased by 24%.
Cell gross sales skilled slight change.
Regardless of a widespread shift towards cellular and social commerce, our service provider information revealed that YoY orders have been down 6% in H1 2022, GMV was down 2% whereas AOV was up 5% in comparison with H1 2021.
When evaluating order sources, on-line gross sales by way of iPhone clearly outperformed gross sales by way of Android.
Between H1 2021 and H1 2022, the well being and sweetness class noticed a 3% enhance in GMV, a 6% enhance in AOV and solely a 2% lower in orders by way of iPhone. Nonetheless, by the identical measure, the well being and sweetness class noticed an 8% lower in GMV, a 3% enhance in AOV and an 11% lower in orders by way of Android.
Well being and sweetness manufacturers develop in B2C and hybrid B2B.
When it got here to B2C companies, well being and sweetness confirmed vital YoY enchancment. Well being and sweetness orders for B2C have been up 10% in H1 2022, and YoY GMV numbers have been additionally up 10%. Nonetheless, YoY AOV was solely up 1%.
Hybrid B2B (retailers promoting each B2C and B2B) numbers have been much more drastic. Well being and sweetness orders have been up 21% in H1 2022 in comparison with H1 2021, GMV elevated by 32% and AOV elevated by 9% YoY.
Pure B2B companies, alternatively, didn’t present the identical progress. Well being and sweetness retailers skilled a 1% lower in GMV, a 2% enhance in AOV and a 2% lower in orders between H1 2021 and H1 2022.
Well being and sweetness outperformed general ecommerce in AMER.
The well being and sweetness class considerably outperformed general ecommerce in North America, with a 15% enhance in YoY GMV in H1 2022 and a 15% enhance within the whole variety of orders, whereas YoY AOV remained flat.
Nonetheless, APAC and EMEA informed a barely totally different story.
In APAC, well being and sweetness retailers skilled solely a 6% enhance in GMV, a 9% enhance in orders and a 3% lower in AOV from H1 2021 to H1 2022. And in EMEA, the well being and sweetness class noticed an 1% lower in GMV, an 11% lower in orders and an 11% enhance in AOV between H1 2021 and H1 2022.
Well being and Magnificence Ecommerce Traits and Predictions
The numbers mentioned it finest: the well being and sweetness trade is certainly forward of the curve with regards to ecommerce.
Trying again on the primary half of 2022, listed below are some noteworthy developments which can be shaping this ecommerce class:
Social commerce helps manufacturers meet clients the place they’re.
Based on eMarketer, the U.S. social commerce market is projected to surpass $50 billion yearly by 2023, which implies that promoting on social media is a should, particularly for ecommerce manufacturers. Plus, with Gen Z gaining shopping for energy and 26% of them utilizing social media to make purchases, this goal demographic represents a big alternative for retailers to achieve market share and increase on-line gross sales.
Instagram and Fb prepared the ground in social commerce functionalities, however different social media websites are additionally gaining traction: YouTube, Pinterest and, most notably, TikTok.
A comparatively new participant to the social commerce recreation, however now a family identify, TikTok has a singular capability to make lesser recognized customers, manufacturers and merchandise go viral in a single day. Outfitted with ecommerce options resembling analytics instruments, product hyperlinks and promoting choices, TikTok has grow to be a hub for companies — particularly well being and sweetness manufacturers — to achieve new audiences and drive extra gross sales.
Movies with the hashtag #Make-up have been seen over 230 billion instances on the app, and #BeautyHacks (15.5 billion views) reveals the variety of TikTok viewers who use the platform for recommendation and training. Only a fast swipe by way of “BeautyTok” — the phase of TikTok content material devoted to make-up and cosmetics — proves that well being and sweetness manufacturers have an enormous alternative to market and promote on TikTok.
A kind of well being and sweetness manufacturers is BigCommerce service provider Bliss, a physique and skincare model, which started tapping into the ability of TikTok in early 2020.
In 2021, Bliss launched its second annual marketing campaign on TikTok with The Trevor Challenge, a LGBTQ youth-focused nonprofit. Internet hosting a cyberbullying speak referred to as PepTok Dwell, Bliss donated $1 to The Trevor Challenge for each constructive remark posted on TikTok that tagged the model.
Now with virtually 400 thousand followers and viral hashtags resembling #ThisisBliss and #FindYourBliss, the corporate has expanded its attain to the Gen Z viewers and quickly grown its model consciousness.
TikTok apart, we are able to’t discuss well being and sweetness advertising and marketing with speaking about video.
From make-up tutorials to product opinions, visible content material is a chief method to market well being and sweetness merchandise, irrespective of the social platform you’re utilizing.
- YouTube, particularly, has been a well known platform for well being and sweetness influencers to advertise their favourite manufacturers and merchandise.
- Instagram and Pinterest supply reels and short-form movies, permitting manufacturers and creators to carry their merchandise to life.
- Livestream Purchasing offers an unfiltered, uncooked expertise, permitting clients to buy in actual time with out having to go to a bodily retailer.
AR and VR bridge the hole between on-line and offline.
Because the in-person purchasing expertise shifts on-line, ecommerce manufacturers have wanted to search out methods to bridge the hole between the bodily and digital. How can a buyer strive on an eyeshadow, visualize the colour of a nail polish or match a basis to their pores and skin tone — all from the consolation of their very own dwelling?
Buying any merchandise on-line (particularly one which’s high-cost) could seem dangerous sufficient, however buying a magnificence or beauty product with out bodily making an attempt it on provides a brand new degree of uncertainty. So, for an trade as hands-on and visible as magnificence, this purchasing class is undoubtedly one of many strongest use instances for augmented actuality (AR) and digital actuality (VR) in retail.
AR and VR works to ease this anxiousness and supply customers with an expertise that matches that of a brick-and-mortar retailer. From Instagram and Snapchat filters to digital make-up try-ons, these rising applied sciences give shoppers the power to work together with three-dimensionally rendered representations of merchandise in real-time.
And in no place will we see these developments extra able to take maintain than within the Metaverse.
Actually, our World Client Report — which surveyed greater than 4,000 web shoppers within the US, UK, Italy, France and Australia — discovered that just about half (46%) of respondents mentioned they’re keen to buy on the Metaverse, and of these, 51% are taken with shopping for each digital and bodily items — which implies the time for well being and sweetness manufacturers to spend money on rising applied sciences is now.
Publish-pandemic comfort stays top-of-mind.
As we study the well being and sweetness class because it emerges from the opposite aspect of the COVID-19, we are able to’t deny that the consequences of the pandemic are nonetheless being felt.
Based on a 2021 survey by Statista, 36% of respondents indicated they ordered extra drugstore and healthcare merchandise on-line in the course of the pandemic than earlier than the pandemic, and one other survey cited that the highest purpose for purchasing on-line is comfort.
For sure, the comfort of on-line purchasing launched by COVID-19 isn’t going away anytime quickly. However what does this imply for on-line retailers?
First, it means providing quick and free delivery. Suppose Amazon next-day supply, pick-up in-store and real-time monitoring updates.
Second, it means providing a number of different fee choices. Digital wallets, cryptocurrency and, most notably, purchase now, pay later (BNPL) have skyrocketed in recognition, as they offer customers the pliability to pay when and the way they need. Actually, our World Client Report revealed that 16% of shoppers have used BNPL at checkout, and 49% of shoppers who’ve used BNPL say it helps purchases match into their budgets.
LARQ, a self-cleaning water bottle model and BigCommerce service provider, skilled firsthand the benefit that comes with providing a number of fee choices. With just one choice for bank card checkout and two-thirds of its transactions coming by way of cellular, LARQ finally launched Google Pay as a substitute fee technique.
“A good portion of our transactions have gone by way of Google Pay since we applied it, which is an effective indication for us that we’re providing one thing that clients discover helpful,” mentioned Antonio Kaleb, LARQ Ecommerce Architect, and Justin Wang, LARQ Co-Founder and CEO. “The power to entry issues like Google Pay seamlessly by way of BigCommerce has helped increase our conversion fee by about 20% since launch.”
Lastly, comfort means making a seamless checkout expertise, utilizing options like intuitive class navigation, one-click checkout and in-app purchases. Each further click on a buyer makes is one other likelihood for them to exit out of your web page and by no means come again, so it’s your job to make the checkout course of as fast and frictionless as attainable.
Clear magnificence steals the highlight.
As Gen Z positive factors spending energy, ecommerce manufacturers are studying methods to communicate to the values of in the present day’s customers. In our World Client Report, when requested what model values affect their buy choices, nearly all of shoppers ranked honesty and transparency as crucial worth. And with regards to well being and sweetness manufacturers, this honesty and transparency extends to a product’s components, its packaging and even the labor behind the product.
Fading are the times of fashionable, mass-produced cosmetics manufactured with harsh chemical compounds and toxins. Right this moment’s youthful shoppers are paving the best way for brand new requirements of magnificence — calling for sustainable, pure components, minimal packaging and honest working situations.
Actually, our shopper conduct survey discovered that almost all of shoppers fee sustainability as both crucial (32%) or considerably necessary (52%) when making a buying choice. Plus, solely 8.5% of Gen Zers acknowledged that they have been detached about sustainability, which implies it’s much more necessary for manufacturers that concentrate on a youthful viewers to market their sustainability efforts.
As a B Corp-certified, clear, cruelty-free skincare model, Bliss has totally embraced the transfer towards clear magnificence. The model’s merchandise are “clear, dermatologist-tested and thoughtfully formulated to attenuate our environmental affect,” and the corporate even consists of an Elements Glossary on its web site.
Variety and inclusion grow to be a high precedence.
However shopper model values don’t cease at sustainability — range and inclusion have additionally grow to be important to sustaining buyer loyalty.
Traditionally, the well being and sweetness trade has been restricted in each its product choice and model messaging with regards to range and illustration. However within the wake of COVID-19, the Black Lives Matter motion and rising assist for the LGBTQ+ group, shoppers are advocating for magnificence that displays all ages, pores and skin tones, genders and physique varieties. And plenty of world magnificence manufacturers are getting on board.
However range and inclusion isn’t nearly providing a larger vary of basis shades (though analysis exhibits that distinctive colour choices in cosmetics have grown 7x as quick as product strains). Variety and inclusion now means larger illustration in product images and movies, commercials, fashions and even influencers on social media.
As extra shoppers hunt down manufacturers that align with their core values, world magnificence manufacturers that embrace the “magnificence for all” motion are poised for fulfillment — whereas those who don’t danger lacking out on a brand new era of shoppers.
Navigating the Way forward for Well being and Magnificence Ecommerce
With rising applied sciences reworking the best way shoppers store on-line, the well being and sweetness trade is in prime place to learn from these developments.
From digital make-up try-ons to AR filters, the way forward for well being and sweetness ecommerce is barely simply across the nook.
Omnichannel promoting creates a linked consumer expertise.
Finally, most of the most profitable companies are those with a powerful omnichannel technique — one which weaves collectively all enterprise channels, on-line and offline, to create a constant, partaking buyer expertise.
Actually, advertising and marketing throughout three or extra channels earns 250% larger engagement.
With on-line marketplaces resembling Amazon and Walmart, social media channels like Instagram and Fb and search engines like google and yahoo like Google, there are lots of of the way to achieve clients except for a standard on-line retailer.
However the important thing to omnichannel promoting is to offer a cohesive buyer expertise throughout all contact factors. This implies syncing stock to keep away from cross-selling, merging on-line and offline gross sales and sustaining a constant model message all through each channel.
New applied sciences open the door for personalization.
Personalization drives buyer loyalty. Whether or not or not it’s by way of focused advertisements, awards and advantages or different custom-made experiences, on-line retailers are discovering new methods to mould the purchasing journey to satisfy their clients’ wants.
Based on our shopper conduct survey, solely 28% of shoppers are unwilling to share some kind of private data in alternate for a personalised purchasing expertise — and unsurprisingly, youthful era customers are essentially the most keen to share their private information.
Particularly for well being and sweetness manufacturers, rising applied sciences resembling AR, VR and AI supply new alternatives to carry the salon on to the shopper and create a product made uniquely for them.
Personalised skincare, hair care and anti-aging merchandise are simply the tip of the iceberg, and as extra manufacturers reap the benefits of rising applied sciences, this sort of personalization simply would possibly grow to be the brand new norm.
Leverage the velocity and suppleness of headless commerce.
In fact, we are able to’t discuss personalization with out speaking about headless commerce.
Headless commerce, the decoupling of a storeʼs frontend design from its ecommerce backend, is the brand new frontier for on-line retailers trying to create distinctive buyer experiences.
Because the ecommerce panorama continues to evolve, on-line companies want to have the ability to transfer shortly and provides clients the versatile consumer expertise they’re in search of.
One BigCommerce service provider that’s leveraging the ability of headless is ecommerce well being model MitoQ. When their staff made the change to BigCommerce, they discovered {that a} headless infrastructure was the important thing to minimizing inconsistencies and creating an optimum consumer expertise.
“We wished one thing that was going to be largely plug-and-play with different techniques,” mentioned Shaun Value, Head of Buyer Acquisition at MitoQ. “Ought to we need to use them, we might seamlessly use current integration instruments to increase the performance of our web site.”
The Last Phrase
For sure, the well being and sweetness class exhibits large promise for the remainder of 2022 — and exhibits large potential with regards to social commerce and each B2C and hybrid B2B promoting.
Moreover, well being and sweetness is skyrocketing notably in North America, and as Gen Z positive factors spending energy, there may be an rising want for well being and sweetness retailers to talk to shopper model values, resembling sustainability and variety and inclusion.
As ecommerce continues to emerge from a two-year pandemic, time will inform which developments stay related and which of them fall by way of the cracks — but when the information reveals something, it’s that ecommerce is not what it was once.
So as to stay aggressive in in the present day’s digital panorama, well being and sweetness manufacturers should preserve tempo with the most recent improvements and be keen to adapt to altering shopper conduct.
Be looking out for our subsequent 2022 Ecommerce Forecast, once we’ll discover much more purchasing verticals and the way on-line retailers can keep forward of the curve.
