Beauty products already are among the fastest growing e-commerce categories in India-driven largely by women consumers. Several studies, reports and surveys in the past two years have tried to make the point. Google said in 2013, that 60 million women are online in India and the one category for which they rely most on internet research for purchase decisions is skincare, followed closely by baby-care and hair care. Just last month, the search giant said India will have a 100 million online shoppers by 2016 of which nearly 40 million women are estimated to shop online by 2016.
However, the numbers with all their intrinsic biases are not as important as the more qualitative underlying megatrend: Our shopping habits are changing and we are shopping and researching more online.
Against this backdrop here are five emerging online buying trends for skincare in India that we see gathering more steam in 2016.
1. More online researchers will turn online shoppers:
In 2013 and 2014 the Internet was primarily a tool for researching skincare products before making a purchase at a physical store. You checked ingredients at leisure, ran a Google search about a few intriguing ones, read reviews and bought the product at a brick and mortar store.
Skincare as a category is made for the Internet. A largely word-of-mouth-driven category, it lends itself well to social media and Internet blogs. Not only is the experience of buying a skincare product from a brand's official website or a legitimate re-seller more engaging and trustworthy but also convenient and non-intrusive with no pesky sales staff trying to hard sell.
2016 is going to be about the Internet skincare researcher becoming an online shopper. Stores will surely co-exist but could well be reduced to an add-on sales and branding channel much in same the way a website was vis-à-vis a branded store a few years ago.
2. Brands will find more first-time consumers online rather than in shopping malls:
As more consumers research and learn online, the Internet has become the environment they meet, get to know, and share their love or spite for a skincare brand. Several Internet-driven business models in the beauty industry led mainly by beauty sample subscription services that send an assortment of sample-sized products to your doorstep taking the pain and heartache from spending money on non-satisfactory full size packs have fueled this trend. Also, the steady rise of amateur Internet beauty gurus and bloggers in India with a devoted following is contributing to this trend.
3. Mobile commerce will gain momentum:
India is the world's second largest mobile economy where most first time Internet consumers--particularly in the Tier 1 and Tier 2 cities, have leapfrogged the PC and use competitively priced smart phones for shopping. E-commerce companies including Snapdeal, Flipkart, Myntra, and their rivals have launched mobile phone applications this year. Snapdeal told a newspaper in October that it expects 90 per cent of its orders to come from mobile devices over the next three years. This will help in getting a mobile savvy Internet consumer base ready across categories including beauty and skincare.
4. Social proof and customer feedback will assume greater importance:
Unlike colour cosmetics, a skincare product is only as good as its ability to show results.
You can't verify the efficacy of a skincare product by merely smelling it or rubbing a small amount on the back of your palm at a physical store. Customers know that and are increasingly attaching more weight to reviews and recommendations from others like them before making purchases. Web blogs dedicated to beauty are proliferating at a rapid pace. Reviews on these blogs and on social networking websites such as Twitter, Facebook and now even Instagram, the mobile based photo sharing app, are and will continue to be invaluable tools for reaching out to and for collecting feedback from consumers.
5. The second generation of e-commerce--Internet-driven omni channel skincare brands:
As the above factors gather momentum, consumers will gradually realise that the Internet isn't just about finding cheaper deals but is a legitimate source of buying products that offer true value. This shall spawn the new wave of vertical integration of manufacturing, branding, and direct-to-consumer distribution.
Even though these brands won't be able to offer the physical, tangible customer experience of walking by an eye-catching display they will be better positioned to benefit from the rise of the Indian Internet consumer by leveraging the web and social media.
Being vertically integrated i.e. having the entire supply chain in-house, such brands are able to pay better attention to product quality and brand communication and at the same time, target specific consumers with intent to buy and track marketing spend more efficiently than the more traditional models of retailing skincare.