How to Start a Beauty eCommerce Business

How to Start a Beauty eCommerce Business

In the eCommerce world, beauty businesses are among the most successful ventures and have experienced unprecedented growth in recent years. The beauty industry is no longer merely a market for lipsticks and lotions; it has evolved into a broad realm that encompasses everything from skincare to supplements, makeup to perfume. Beauty isn’t only about appearance; it encompasses health and wellness, too. That means there are endless opportunities to join the industry as an entrepreneur. 

As far as the success of the beauty industry goes, the numbers really speak for themselves. The global beauty and personal care industry is projected to generate a revenue of nearly $900 billion worldwide in 2023, and it’s expected to accelerate even more in years to come. The beauty industry is undeniably flourishing – and eCommerce has played a big role in its success. Between 2015 and 2022, for instance, eCommerce in beauty nearly quadrupled, and its share in the market now exceeds 20 percent.

If you’re considering starting a beauty eCommerce business, there are several things to keep in mind before embarking on the journey. As experts in shipping and fulfillment, Stalco has partnered with countless beauty companies over the years – in fact, it’s a space we have long specialized in. We’re excited to share valuable insights and tips to help you start a successful venture in the beauty business.

Unpacking the Potential of the Health and Beauty Industry 

A Look at the Industry’s Growth and Projections

As mentioned above, the health and beauty industry is growing at a rapid pace – and, according to projections from experts, this is only the beginning. In 2020, a year fraught with unprecedented challenges around the world, the global beauty and personal care industry maintained its integrity, and was valued at roughly US $532 billion. This figure highlights the beauty market’s resilience, and the unwavering demand for products that cater to wellbeing and aesthetic enhancement. 

In a post-pandemic world, the beauty industry has continued to thrive, with no signs of slowing down. According to market predictions, experts forecast a compound annual growth rate of 4.75% from 2021 to 2028. Not only is the industry expected to maintain its current momentum, but experts expect it will propel itself to new heights of success in the future. At this point, the health and beauty sector has proven it is not simply a fleeting trend; it’s a powerhouse industry that is poised to shape the future of global eCommerce.

While beauty and health is a big deal around the world, leading markets currently include North America and the Asia-Pacific. North America, for its part, is a pioneer in beauty and wellness trends, and continues to dominate the global market with a significant share. Meanwhile, the Asia-Pacific region is also a force in the industry that should not be overlooked. Asian beauty rituals have become deeply ingrained in the lifestyles of consumers across Asia and beyond, creating a competitive and dynamic beauty industry.

The US Health and Beauty Market

The United States, in particular, has emerged as a true trendsetter in the global health and beauty market. According to 2023 statistics, the U.S. is leading the global market by a landslide. It brought in US $98 billion, followed by China, which brought in US $67 billion this past year.

What sets the U.S. health and beauty industry apart is not only its astounding revenue, but also its projected growth rate. Experts expect a robust growth trajectory, with a rate that reflects the industry’s ability to stay ahead of the curve. This optimistic outlook further reinforces the United States as a superpower in the global health and beauty arena. 

It’s worth noting that a key driver behind this growth is the burgeoning online sales sector within the health and beauty industry. In recent years, online sales in the health and beauty industry saw a significant surge. From cosmetics to haircare, consumers are increasingly turning to online avenues to explore, compare and purchase products. 

Tapping into Google Trends, it’s clear that the interest in the health and beauty category is consistently high among American consumers. Data suggests that consumers aren’t merely occasional shoppers; they are actively engaged in exploring the latest trends, innovations and product offerings within the beauty space all the time. This sustained interest highlights the beauty sector’s ongoing appeal, making it a great space for prospective entrepreneurs to explore new possibilities. 

Why Choose eCommerce for Health and Beauty? 

There are numerous reasons to start an eCommerce business in the health and beauty industry. In our experience, here are the top four benefits: 

1. Timeless nature of beauty products 

Unlike other trendy markets, beauty products have always been – and will always be – needed and coveted by consumers. Health and beauty products are integral to the daily lives and rituals of consumers. Skincare and makeup products are consistently part of self-care routines, and therefore, they are always in demand. While there are undoubtedly fleeting trends in the health and beauty space, for the most part, staple products never go out of style. The need for effective skincare, haircare and wellness products remains constant, which provides a solid foundation for a sustainable and enduring business model. 

2. Potential for repeat purchases 

As we mentioned above, the health and beauty industry is timeless, and as a result, the industry thrives on repeat business. If a consumer finds a product that aligns with their needs and personal preferences, brand loyalty will typically follow suit. This loyalty transforms one-time buyers into lifetime customers, creating a strong revenue stream. 

3. The power of online purchases 

Online purchases have experienced a meteoric rise recently, driven, in large part, by the convenience of browsing and purchasing products from the comfort of one’s own home, and with the click of a button. Online shopping has become an integral part of the health and beauty customer experience, and has allowed eCommerce entrepreneurs to capitalize on the shift in consumer behavior. 

4. Global reach 

Since the health and beauty industry is popular around the world, eCommerce entrepreneurs have the opportunity to transcend geographic limits and reach consumers across the globe. By employing the right digital marketing strategies, brands can now tap into diverse markets and expand their customer base considerably.

Getting Started: Niche Areas in the Health and Beauty Industry 

Haircare

Haircare is one of the hottest sects within the health and beauty industry – and for good reason. In 2023, the haircare market in the United States is projected to generate a revenue of US $13.44 billion. 

The market has undergone considerable growth, and it continues to be a focal point for innovation, trends, and consumer engagement. The U.S. haircare market has robust potential for businesses to explore and thrive, driven by an enduring desire for effective and innovative haircare solutions among consumers.

Male Grooming Products

Although the health and beauty landscape might be most commonly associated with women, the male grooming products market has tons of potential. The past decade has been marked by a shifting cultural landscape and changing attitudes toward personal care among men. Men are increasingly recognizing the correlation between personal care and confidence, which has resulted in a significantly higher demand for grooming products. 

The market has responded to this cultural shift by releasing a slew of diverse grooming products that are tailored to men. There are now a variety of male-centric skincare products, as well as beard care, haircare, and grooming tools and accessories specifically made for men. 

The growth of the eCommerce space has made things even more convenient for men. Online businesses offer a range of products and tutorials, empowering men to elevate their grooming routines. Men seem more willing than ever to invest in their self-care rituals, and as grooming becomes a key aspect of the modern man’s everyday life, the industry will undoubtedly continue to grow.

Skincare Products

As you might expect, the skincare industry is booming. In 2023, the U.S. skincare market is projected to generate a whopping US $23.6 billion. Since the pandemic, people have been intensely focused on wellness, and there has been a heightened demand for innovative, clean and effective skincare products as a result.

Skincare has become a key pillar in overall wellness, as consumers have come to see it not only as a cosmetic practice, but also as a vital component of self-care. There is a broader trend of wellness-driven beauty, and skincare fits squarely within that movement.

More than ever, consumers are seeking clean and environmentally sustainable skincare products that have eco-friendly packaging and are cruelty-free. Consumers are increasingly aiming to avoid harmful ingredients, so if you’re hoping to potentially start a skincare brand, that’s definitely something to keep in mind. 

In addition to clean and sustainable skincare, another trend in the industry is a focus on anti-aging. Skincare isn’t just about addressing existing skin issues, it’s also about preventing issues from popping up down the road. Consumers are proactively purchasing products that contribute to long-term skin health and vitality. 

Expert Tips for Launching a Successful Health and Beauty eCommerce Business 

If you’re hoping to launch a health and beauty eCommerce business, there are a few key tips to consider. Here’s our best advice from the Stalco team: 

1. Find a niche 

Given the increasingly saturated and competitive beauty industry, it’s important to find a niche product that will help you stand out. If you focus on a niche – such as targeting a specific skincare concern like aging or acne – you’ll be able to differentiate your brand in a crowded market. Consider what’s already out there, and find a way to solve a problem that hasn’t been solved well. 

2. Embrace innovation

If you commit your eCommerce business to innovation, you’ll be far more likely to emerge as a leader in the health and beauty industry. Releasing products that use innovative ingredients, formulations or technologies will ensure you stay ahead of the curve and attract new customers.

3. Listen to feedback 

Consumer feedback holds more value than you might think. Pay attention to reviews, comments on social media and other input from customers in order to gauge what exactly consumers are craving. This insight can help shape product development and marketing strategies that will elevate your business immeasurably.

4. Leverage social media 

Social media has proven to be an invaluable tool for eCommerce business owners – especially in the health and beauty space. Skincare and beauty enthusiasts often seek recommendations on social media. That’s why it’s hugely important to share engaging content to build your brand, and capture the attention of beauty lovers. Collaborating with social media influencers who can spread the word about your brand is another great way to broaden your business. 

5. Offer incentives

Having loyalty programs, promotions or discounts is useful for attracting and retaining new customers. These incentives can foster a sense of excitement and will encourage repeat business. 

6. Create a user-friendly website 

Since your business will be online, your website will be the face of your company. Make sure it is user-friendly and visually appealing, and also optimized for mobile devices. You want to create a seamless shopping experience for customers, which will unquestionably lead to an increased likelihood of conversions and repeat business. 

7. Emphasize customer service 

If you want your beauty business to flourish, make sure you have a robust customer service operation to meet the needs of consumers. Exceptional customer service fosters loyalty and retention, and ultimately encourages customers to become advocates for your brand.

8. Expand across numerous channels

In addition to having an excellent website, it’s useful to diversify your sales channels by exploring different marketplaces such as Etsy, Amazon and eBay. While it’s important to have your own standalone eCommerce store, you should aim to widen your reach and expose your brand to a larger audience. Each platform has its own unique offerings and benefits that can contribute to your business’s prosperity. 

The Role of Shipping and Fulfillment in Your Beauty eCommerce Business 

As we’ve discussed in previous blog articles, an eCommerce business is only as strong as its shipping and fulfillment services. Sure, a business can create a prize-winning product, but if that product isn’t getting into the hands of customers efficiently, the company will never reach its full potential.

Customer satisfaction is closely linked to the timely delivery of products, so having a reliable shipping and fulfillment strategy in place is non-negotiable. Not only is it important for products to be delivered in a timely manner, but they must also be packaged properly. Beauty products – especially those containing liquids in delicate containers – require careful handling to maintain their integrity. 

That’s why we strongly recommend partnering with a dependable fulfillment provider, such as Stalco, which has immense expertise in the health and beauty sector in both Canada and the United States. We’ll ensure your products are delivered in pristine condition and right on time. Our team is also exceptional with returns management – which is another important thing to think about when running an eCommerce business. 

In short, we’ll tackle all the logistical considerations of your business, so you can focus on creating stellar products and attracting consumers. Partnering with a shipping and fulfillment expert will allow you to bring your business to a new level.  

Conclusion

The future of the eCommerce beauty business looks brighter than ever. If you’re hoping to embark on a new entrepreneurial endeavor, the health and beauty sector is a highly promising place to consider. The market is thriving – as it has been consistently for many years – and the beauty world has a timeless appeal that will allow your business to be sustainable.