IS THE BEAUTY CATEGORY HEADING UP ONLINE IN CANADA?

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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:

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