Apparel is not the only retail sector to have been affected by the proliferation of international chains setting up store in Australia local cosmetics retailers have had to accommodate French giant Sephora, which has opened eight stores since its arrival in late 2014.
Even so, the real power players are pharmacies, attracting more cosmetics customers than any other kind of store, new data from Roy Morgan Research reveals.
Between 2006 and 2016, the overall proportion of Australian women buying cosmetics in an average six months has remained fairly stable (barely shifting from 51.5% to 50.5% in 10 years). But there have been some noteworthy changes in where they purchase them, with pharmacies (19.1%, up from 15.1%), and to a much lesser extent, supermarkets and department stores gaining popularity.
In contrast, fewer women are now buying cosmetics from discount department stores than they were in 2006.
Prestige cosmetics super-stores such as the aforementioned Sephora and Australia’s own MECCA fall under the ‘Other’ category (although Mecca’s concession stores in Myer would fall under department stores), which has lost some ground in the last decade, from 9.6% to 7.7%.
Who shops where?
Viewing Priceline’s make up customers reveals that young, socially active and cashed up women are more likely to buy cosmetics from the chain. They are also more likely than their counterparts to purchase make up from Chemist Warehouse.
Of the supermarkets, Coles is the most popular for cosmetics, with nearly 600,000 Australian women making their last purchase there, just ahead of Woolworths (565,000). While this same group are more likely to shop for make up at Coles, women from outer-suburban, hard-working demographics are the most likely to buy their cosmetics from Woolworths and supermarkets in general.
Michele Levine, CEO, Roy Morgan Research, says the Australian beauty industry is a totally different beast to what it was just a decade ago.
"Not only is there an increasing proliferation of niche brands specialising in everything from all organic ingredients to specific products only, but social media has changed the way women interact with brands," Ms Levine said.
"Celebrities and other influencers share their favourite make up techniques and products via Instagram, how-to tutorials abound on YouTube, and the pressure to look good in ‘selfies’ is an undeniable factor influencing younger women’s purchases.
“Add to this the rise of internet retailers such as Adore Beauty and Strawberry.com, who offer the convenience of online shopping, frequently at discounted rates, and the landscape becomes even more competitive.
“Against this shifting backdrop, pharmacies remain the most popular place for Aussie women to buy make up, with nearly one in every five making their last cosmetics purchase at one. But like all retailers, they’ve had to adapt to the digital age to remain relevant: Priceline’s Instagram feed, for example, is heavily cosmetics-focused, while their website has a dedicated ‘Beauty School’ section containing videos and step by step lessons.
“Yet despite the impact digital and social media have had on the cosmetics sector, retailers need to be aware of the growing consumer trend towards ‘retailtainment’ rather than a simple transaction. Once again, Priceline is leading the
"Once again, Priceline is leading the way, and offers free personalised consultations with their resident beauty advisors. But beauty superstores such as Sephora and MECCA, as well as department store concessions, also stand to benefit from this trend, being perfectly placed to fulfil their customers’ desire for an in-store ‘experience’ with make up artists and hands-on product testing.”