The Future of Innovation in the Beauty Industry Brands must innovate their experiences and offerings to meet the new needs of consumers in the post-pandemic environment.
By Joy Chen Edited by Russell Sicklick
Opinions expressed by Entrepreneur contributors are their own.
The pandemic has changed the ways in which consumers shop, as well as what they're looking for from the skincare and beauty brands they use. As restrictions are lifted and a new sense of normalcy returns, consumers will continue to expect new innovations and unique product offerings, and will seek out brands that are incorporating the latest technologies into their offerings. The recent trend towards customized product offerings is just one example of how the skincare industry has attempted to meet customer demands, yet few brands have actually been able to do so successfully. What follows are considerations for business leaders as they incorporate new innovations into their business models and rethink the focus areas for innovation within their brands.
Less is more
In order to succeed post-pandemic, brands must keep up with the changing needs of consumers. Being forced to stay at home because of the Covid-19 pandemic caused many people to re-evaluate their lifestyles and resulted in a more minimalist mentality. In prioritizing health and wellness, consumers began to focus primarily on more simple ways to stay healthy — from what we eat, to how we sleep, and the products we use on our skin.
In the skincare industry pre-pandemic, consumers were interested in using numerous products, often incorporating eight to ten steps into their skincare routines. This changed dramatically in the past year, with many consumers adopting a "less is more" mindset by using only three products or fewer in their routines — saving time, money, and energy. Additionally, consumers began to take a greater interest in the ingredients in their products, understanding that by using fewer products, they could eliminate conflicting ingredients causing more harm than good to their skin. With the change to a more simplistic lifestyle, brands must continuously bring unique innovation to their products to offer consumers what they want and need.
Related: How the Beauty Industry Has Pivoted Since the Pandemic
Revitalizing the consumer experience
The pandemic disrupted almost every industry and forced businesses to rethink how they operate, yet business leaders should not assume that the retail industry, among others that relied on in-person operations, won't come back. To stay ahead of the curve, brands should rethink how their offerings might already meet the changing needs of consumers and market their offerings in new, creative ways.
Innovation is vital to the growth of any business, and business leaders must ensure their organizations stay ahead by proactively thinking about what the future of beauty looks like and what consumers want. An important component of this is the customer experience. The pandemic changed the way businesses were able to reach consumers, and by utilizing the switch to technological offerings in the form of more customized algorithms, brands can create a seamless customer experience across traditional and digital platforms. While it will be challenging, doing so will ensure high brand engagement and ultimately result in business growth. Innovation should also go beyond the product offering to include new services for customers, including consultations for beauty brands, rethinking how consumers unbox their products, as well as thinking about how education can play a role in the overall customer experience.
During the pandemic, the online experience accelerated and expanded what is acceptable from a customer service perspective. Because of these necessary changes, there is more available to the consumer than ever before and the consumers' acceptance of that is wide-ranging. The pandemic forced immediate innovation but has now opened the door for additional and ongoing changes that enhance the customer experience while shopping, using those products, and engaging with the brand.
Related: How Technology is Revolutionizing Beauty Ecommerce
Retail innovation
It is essential for brands to understand that the beauty industry was already changing before the pandemic hit. Consumers started searching for products that were uniquely right for them, whether by adding supplements to their diet or seeking out custom skincare products. At the time, beauty brands relied less on the physical retail store and shifted to direct-to-consumer (DTC) offerings as consumers embraced the digital environment and became more comfortable purchasing goods online. Some businesses were prepared for this massive change, while others couldn't keep up with the increased demand for innovative offerings. The pandemic caused a massive shift in digital acceleration and innovation, from marketing with influencers to creating digital ads and virtual imaging, as well as innovation with the DTC function, including the implementation of robust chat bot systems.
In order to succeed now, business leaders need to identify how their organization fits into the market pre-pandemic versus post-pandemic before incorporating new innovations into their business operations and offerings. Ideally, after a careful analysis of internal operations, business leaders will be able to pinpoint the key areas within their business models that are most in need of a transformation to keep up with consumers' shifting needs.
An important component of this will be retail innovation. Despite DTC taking off during the pandemic, brick and mortar will be back in the post-pandemic environment. Brands will need to rethink traditional aspects of the beauty industry, including how consumers will want to test products moving forward, and incorporate new ways to meet their needs. It's critical that brands broaden what innovation looks like in the retail setting moving forward, and can find a balance between traditional and digital offerings by prioritizing online and in-store services to keep up with shifting demands.
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