IS THE BEAUTY CATEGORY HEADING UP ONLINE IN CANADA?

Contributed by RETAIL ASSEMBLY

The industry’s biggest players were all championed in the news this month for their innovation in beauty e-commerce.  But we’re not sure much progress was actually made north of the border. 

Amazon, a Seattle-based retailer, did launch its Luxury Beauty Store online – which is big news for consumers on both sides of the border.  Although, the assortment was initially small, with fragrances from Burberry,  and selections from Nars, Deborah Lippman, and L’Occtaine.  The commitments the retailer has made to luxury beauty brands, should ensure quick onboarding and assortment growth.  Amazon will maintain pricing which is comparable to what other retailers offer, and showcase the product in a distinct environment, in the Luxury Beauty Shop. 

Amazon is difficult to ignore, in 2012 a Forrester survey revealed that 30 percent of online buyers began researching their last purchase at Amazon (versus only 15 percent on Google).  And the free shipping on orders of $25 or more is a significant advantage over Sephora’s $75. 

Aside from the 6 new brands on Amazon, all of which are available via Sephora already, Canada’s beauty industry saw no significant ecommerce news in beauty.  Joe Fresh launched their site last month – apparel only, and while we appreciate that Shoppers Drug Mart has attempted ecommerce with Murale, most product featured on-site is “available in-store only” or out-of-stock. 

Shoppers did make an announcement which received a lot of press, but on closer inspection it appeared to be more of a loyalty program perk.  Shoppers teamed up with Beyond the Rack to offer Optimum loyalty card members access to exclusive offers from BTR’s assortment of apparel, accessories, and technology and points on purchases.  Beyond the Rack boasts almost 10 million members (only half of which are in Canada), and when compared with Optimum’s 10 million cardholders, the advantage seems to be for BTR. 

In the last two years, online sales have grown by 24 percent in Canada to $18.9 billion.  Although this is only a 4 percent share of total retail sales in Canada, double-digit sales increases are nothing to sneeze at.  Why is Canada’s largest beauty player, Shoppers has 28 percent market share in prestige beauty, not online in a meaningful way? 

Read more:

RETAIL ASSEMBLY on Target’s Beauty Strategy

Canadian Grocer on Shoppers Drug Mart

Mashable on Amazon’s Luxury Beauty Store

The Globe and Mail on Canadian retailers slow out of the online gate

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