What characterises the beauty market?
To make it clear, we should first define areas and products that constitute the beauty market. According to the most popular definition, beauty market comprises:
- products for
- skin and
- hair care,
- make-up cosmetics
- fragrances and perfumes,
- toiletries and deodorants .
The spread of specific product lines within the market depends strictly on geographical location. Globally, it looks as follows:
Clearly, the portfolio of beauty market products is very broad. It is worth remembering though, that despite the obvious similarities, according to the definition, products of oral hygiene, personal hygiene or household chemicals are not considered as beauty products.
Global beauty market
Beauty market is unique in the world of global economic changes. As one of the few, it remains resilient even during global economic crises. Well-known “lipstick effect” was related specifically to the increased sales of exclusive cosmetics as a substitute for more expensive luxury goods during the economic downturn. This term was coined in 2001 by Leonard Lauder, Chairman of Estée Lauder.
It is worth noting that on all major markets (except Europe), the growth dynamics is presented in double-digit numbers, and the records are reached by the developing countries- e.g. a 50 percent growth in Brazil or 43 percent growth in India. As a result, in 2019 the global beauty market value reached USD 532 billion.
According to expert analyses, growth dynamics will remain at a similar level. OrbisResearch in its report „Global Cosmetics Products Market-Analysis of Growth, Trends and Forecasts (2018-2023)” forecasts that within the next five years (2018-2023) further growth by over 7 percent will be observed.
Strong beauty brands
At this point it is also worth coming back for a moment to the topic of luxury goods market, where cosmetics and perfumes fall into a strong and distinctive category. As Deloitte states in its report “Global Powers of Luxury Goods 2019. Bridging the gap between the old and the new”, luxury cosmetics and perfumes producers recorded the highest among all product categories- 16.1 percent growth over the previous settlement period. In Deloitte’s TOP 10 ranking of luxury goods companies by sales, there are two beauty companies present. The Estée Lauder Companies Inc. comes in the second place and L’Oréal Luxe is in the seventh place.
The leading position holds the French group LVMH Moët Hennessy-Louis Vuitton SE, the owner of, inter alia, Sephora drugstore chain. Perfumes and Cosmetics business segment accounted for 22.4 percent of LVMH’s sales and as a separate category recorded a 12.3 percent growth. Moreover, the next two manufacturers of the beauty product area were listed among top 20 fastest developing companies: Coty Luxury came in second and Shiseido Prestige & Fragrance came in fifth, reflecting the strength of the beauty market.
Beauty market in Europe
Beauty market value in Western Europe also presents itself well. According to statistical data, in 2019 it reached EUR 79.8 billion.
Among European countries, the highest consumption of beauty products has been recorded in Germany, France and Great Britain, where local markets are valued at EUR 14 billion, EUR 11.4 billion and EUR 10.6 billion respectively (in the year 2019). However, a podium reshuffle may await us. Market value level in Germany and France has remained the same for several years, but in Great Britain it has dropped significantly. In 2015 its market value stood at EUR 12.5 billion- which means, that over the period of four years it has decreased by over EUR 2 billion. Great Britain is already been chased by Italy and perhaps it is Italy that will soon be at the forefront of beauty sector in Europe.
Although European beauty market is the biggest of all global markets, it is still going through various changes. Manufacturers and distributors have to adjust to them. The reshuffle of product categories meaning within the market is a significant change for example. According to Cosmetics Europe, although the value of skin and hair care products purchase is increasing, the value of perfumes purchase is decreasing.
Another interesting change on the market are dynamic sales growths in the countries that up until now have been among the less important on the map of Europe. The diversity of growths observed between 2016 and 2017 is a good example of this situation, where the highest growths belong to Poland (12.1 percent), Chroatia (7.1 percent) as well as to Romania, Estonia and Finland (5.7 percent each).
Beauty industry in Poland
Is Polish trade all about beauty products? One might say, that it is a very important segment of the national economy, significant in terms of the European market. The share of the Polish beauty products sales in Europe amounts to over 4 percent, which allows us to reach 6th rank among other countries from our continent.
However, the value of the cosmetics and perfumes shopping basket in Poland is still much lower than in Europe or worldwide. According to the analysis of Santander Bank Polska, average annual spend on cosmetics in Poland stands at about EUR 100, whereas European average is EUR 127, and the highest average in Europe is EUR 229 (Norway). Taking into consideration good economic situation and beauty market upward trend observed in the recent years, but also luxury goods market forecasted growth to PLN 39 billion, we were counting on significant sales growths within beauty industry until 2020.
Unfortunately, the year 2020 turned out to be very difficult both for cosmetics manufacturers and the sellers. Companies from the first group have often decided to change their business profile, opening their operations to the production of liquid and gel sanitizers, which resulted in problems with the sale of such products at the end of 2020 (declared by as many as 70 percent of manufacturers). The second group on the other hand, had to quickly adapt to new rules (retail shops shutdowns) and customers’ expectations (online sale implementation). As Polish Union of the Cosmetics Industry states in its report “Cosmetics Industry and COVID-19. Six Months of Operation During the Pandemic”, between spring and summer, a significant fall in sales of colour cosmetics, perfumes and sunscreen products occured. As a result, an upward trend of the beauty market value, which for several years has been observed both, in Poland and the whole Europe, may be strongly hampered.
Beauty market in e-commerce
It seems like current growth in value of the beauty market is connected particularly to the development of e-commerce. The data concerning the share of relatively “young” beauty industry in the whole online shopping market is still not accurate though- depending on the source of information, its share stands at 27 percent , 32 percent  or even 52 percent . Regardless of which of these values is closest to reality, we may clearly state that beauty products are one of the most important industries on e-commerce market.
Polish beauty industry market in e-commerce is highly monopolised. A survey on spontaneous recognition of internet drugstores proved, that the most recognisable brands are Rossman, Douglas, Sephora and Hebe- all of them have a high, double-digit recognition score. Right behind them there are brands such as Drogeria Natura or Notino.
Beauty market – m-commerce
On the Polish beauty market, two trends are clearly marked: m-commerce and cross-border shopping. Polish people are willing to use their smartphones to buy cosmetics online- as many as 33 percent of the online buyers do it. We are also less and less concerned about making online purchases from overseas: cosmetics and perfumes turn out to be the third fastest growing CBEC category, right after electronics and GSM industry, and 24 percent of e-consumers declare buying cosmetics and perfumes from foreign websites. Most of the time, it is younger consumers who decide to purchase from overseas, as they follow the latest fashion and eco-friendly trends which are not always available on the Polish market.
So it is no surprise, that well-known beauty shop brands invest in their online shops. They develop them not only by adding new and popular products, but also by paying particular attention to the user experience of the entire purchasing process. Starting from user-friendly payment, through free and fast delivery (same or next day delivery), up to the possibility of returning or exchanging purchased products.
Additionally, e-sellers from the beauty segment have to itensify the solutions supporting completing purchasing process. roduct- they are the ones who tend to buy cosmetics online more and more often.
How do we buy cosmetics? Polish consumer behaviour
The majority of online shoppers are women, 51 percent of whom buy cosmetics online. An insteresting fact is, that they are not from the youngest age category, which is often associated with online sales development in all industries. Mostly they are women in the 35-49 age range.
Where does this popularity of online beauty shopping come from? It is worth taking into consideration the way we use cosmetics on a daily basis. The results of Biostat’s survey „Polki na zakupach w drogerii – po jakie kosmetyki najchętniej sięgają?” (Polish women shopping in a drugstore- which cosmetics are they most likely to choose?), conducted in February 2019, demonstrate some interesting trends. According to this survey, as many as 66 percent of Polish women put on make up every day, and their favourite type of cosmetic is mascara (over 83 percent). Second place goes to foundation (59 percent), and the last on the podium is loose powder (26 percent). If we were to summarise these results by beauty segment categories, we could say that the most popular are make-up cosmetics (72 percent) as well as body and facial care cosmetics (68 percent).
Key factors determining the choice of given cosmetics
Although Poles eagerly search for information and opinions on cosmetics online (as many as 42 percent on internet forums and 35 percent on social media), quality or brand reputation are still not the most important purchasing factors. The key factor, according to 30 percent of people buying cosmetics, is price or special offer but also the fact of running out of a given cosmetic (according to 26 percent of the buyers). As the best forms of promotions consumers consider buy one get one free (46 percent) and -of course- lower price (44 percent).
Poles’ interest in cosmetics
As seen above, Poles are interested in cosmetics. Mostly, they read tips on blogs and “how-to” websites, they follow beauty influencers’ profiles and search for opinions of other social media users. Therefore, it should not surprise us that a lot of online drugstores invest in content marketing. They develop their own sections of beauty tips and cosmetics tests, to be able to redirect their customers to buy straight from an e-shop. Manufacturers’ necessity to directly develop own e-commerce channel can also be observed – brand online shop becomes a “must have”, a source of information about consumer behaviour and a great communication and brand image improvement tool.
Cosmetics purchasing vs. omnichannel strategy
Since the introduction of online sales channel and its developement, brands that sell cosmetics have started to build their own omnichannel strategies. At the beginning, the consumers fitted in perfectly: from among all available channels they were choosing those with special offers or sales included.
It turns out, that nowadays this purchasing model is beginning to change. The research that has been conducted for over 4 years shows, that in beauty industry multichannel shopping is decreasing- in 2018 it dropped by as much as 9 percent compared to 2017.
It means that it was already two years ago when customers started to choose their favourite shopping channel and use it. Taking into account the increase in the number of online shopping transactions we may conclude, that the choices concern online sales channel in particular. In the beauty industry, however, there is a relatively small number of companies or brands, that have their own retail sales network, i.e. branded company stores, and this can hinder building sales in an omnichannel model.
Online shopping is chosen also by people, who normally do their shopping offline. However, when buying online, they expect receiving their order packaged in a gift box (e.g. for Christmas). Internet is used as well by people living in small towns and villages, because they have limited access to big drugstores.
Beauty industry is doing really great both, in overall sales performance worldwide and in Poland, as well as in e-commerce. At this stage, the key to further brand development is not holding back bold decisions and investments in new solutions. Keeping an eye on constantly changing consumers behaviour and following up on their expectations in order to respond effectively is also vital.
[1,2,13] PKO, „Branża kosmetyczna 2017”
[5,6] OrbisResearch, „Global Cosmetics Products Market-Analysis of Growth, Trends and Forecasts (2018-2023)”,
 Deloitte, „Global Powers of Luxury Goods 2019. Bridging the gap between the old and the new”
[9,10] Statista.com, https://www.statista.com/statistics/491453/beauty-and-personal-care-western-europe-market-value/
[11,12] Cosmetics Europe, https://www.premiumbeautynews.com/en/the-european-cosmetics-market-grew,13629
 KMPG, „Rynek dóbr luksusowych w Polsce 2018”
[18,19,20] Polski Związek Przemysłu Kosmetycznego, „Branża kosmetyczna vs. COVID-19. Pół roku funkcjonowania w pandemii”
 Comarch i Kantar TNS, „Przyszłość zakupów. Najważniejsze trendy w retail dziś i w 2030 roku”
[22,25] „Omni-commerce. Kupuję wygodnie”, czerwiec 2019
 Gemius dla E-Commerce Polska, „E-commerce w Polsce 2019”
[24,26, 27] Gemius dla E-Commerce Polska, „E-commerce w Polsce 2020”
 Comarch i Kantar TNS, „Przyszłość zakupów. Najważniejsze trendy w retail dziś i w 2030 roku”
[31,33] Biostat, „Polki na zakupach w drogerii – po jakie kosmetyki najchętniej sięgają?”, 2019
[32,34] Retail Market Experts by PMR, „Rynek artykułów kosmetycznych w Polsce 2018”
 „Omni-commerce. Kupuję wygodnie”, czerwiec 2019