Selling hair products online is one of the hottest trends of the moment. Amazon is the largest online marketplace and moves huge volumes of traffic, making it desirable for businesses of all sizes to profit from a presence within its platform; on the Italian Marketplace alone, typing haircare brings up over 60,000 entries!
After the downturn due to the forced closure of salons during the pandemic, the coming years will see strong growth in haircare products, which today, with a market share of 15 percent, represent the second largest segment after skincare at 25 percent (source: Euromonitor).
According to Reportlinker, the global market for hair and scalp products will reach $121 MLD by 2027 with a CAGR Of 6.5% over the next 5 years.
The haircare market is split between shampoos&conditioners (38 percent), hair styling products (24 percent), coloring (22 percent), and treatments (16 percent).
Not only are growing products with natural and organic actives (according to NDP, clean brands now cover 25 percent of the market), but also those that target the scalp, a segment that will account for 15 percent of new launches between 2023-2027. In January 2023 Spate reported that searches for scalp products had grown 28.5 percent year-on-year
While driving demand for specific products is the growing prevalence among the world’s population of issues such as dandruff, dry and itchy scalp, hair loss, and dry, dull hair, another factor not to be underestimated is the increase in the world’s elderly population: according to World Population Prospects data, the over-60s were increasing faster than all other age groups in 2019.
Therefore, it is not surprising to learn that for the future, the focus will be on actives that are useful in restoring hair pigmentation, solutions to slow the graying process, and ingredients that link back to ancestral rituals and pay homage to centuries-old cultures.
Distribution Channels
Distribution of haircare products is typically through wholesale to retailers and resellers or through a direct-to-consumer (DTC) approach, in which the manufacturer sells directly to the public.
Common distribution channels include:
- Brick and Mortar: hypermarkets, department stores, pharmacies, etc.
- Ecommerce: Online marketplaces such as Amazon.
- Direct to Consumer: Branded stores or online marketplaces.
Hypermarkets/supermarkets are the dominant retail channel
The popularity of hypermarkets/supermarkets is further fueled by factors such as urbanization, increasing working-class population, and competitive prices, which contribute to their appeal in both developed and developing regions.
= > Rapid growth of online sales channels expected
Online sales channels, such as e-commerce platforms, are set to experience the highest compound annual growth rate (CAGR) of 7.6 percent through 2027.
Although the transition of beauty and haircare products to online sales has been slower than in other categories, brands are increasingly shifting their marketing efforts to online audiences.
Here are some key statistics showing the rise of digital marketing and its effects:
- 82 percent of buyers in the beauty niche actively use Instagram every day.
- About 67% of beauty shoppers rely on influencers as their main source for discovering new beauty products.
- 42% of consumers say they are willing to buy products promoted by influencers.dotti promossi da influencer.
Consumer trends in the purchase of beauty products:
- Millennials are the largest global consumers: According to a survey conducted in the third quarter of 2022, millennials represent the largest share of global consumers (36%) who have purchased beauty products.
- Gen Z consumers are the most likely to buy online: After millennials, Generation Z consumers account for 35 percent of beauty product buyers in the online space. This digitally savvy generation is comfortable with online shopping and relies on the web for their beauty needs.
The rituality of cosmetics consumption, accompanied by new models of in-store experientiality, improves consumer engagement with brands as well as full trust and identification in the values narrated by companies.
Corporate storytelling is a strategic lever that plays the central role in strengthening consumer connection and communication on issues such as sustainability.
Presence in Amazon
When it comes to uploading products to Amazon, it is important that the information provided is comprehensive and accurate to provide a good shopping experience for Amazon customers, which includes accurate product descriptions, good product photos, and a robust presence of positive reviews.
In dealing with Amazon, on the other hand, a number of product assurance and safety requirements must be fulfilled: cosmetic products come into direct contact with the skin. If these products are not well formulated and well-regulated, they can cause problems and discomfort to those who use them. To maintain its reputation and ensure the safety of its customers, Amazon must ensure that beauty and health products on Amazon.com adhere to a safe standard.
Finally, as an Amazon seller, it is also important to develop a strong social media presence. By optimizing social media pages and using appropriate conventions and tactics to attract users to its products.