WHAT CHALLENGES WILL BEAUTY BRANDS FACE IN 2018?

Ellie James
10 January 2018

Entering the New Year has got us pondering the challenges our beauty industry clients will face in 2018.

Here are our thoughts…

THE EVOLUTION OF INFLUENCERS

We predict influencer marketing will move in two directions, towards micro-influencers who have high engagement levels and long-term partnerships with bigger influencers that last weeks or even months.

As for the crackdown on influencer sponsored posts, we think that in 2018 this will get stricter. Right now, the FTC has already declared that when money has exchanged hands the hashtags #ad and #sponsored are fine, but #sp,#spon and #partner won’t cut it.

But there have been hints that soon even freebies influencers receive from a brand will have to be labelled #ad.

INCREASED COMPETITION

New beauty brands are killing it. We’re talking the likes of beauty superstars such as Fenty all the way down to Instagram start-ups like Frank Body. New beauty brands are filling niches that until recently the industry didn’t even realise existed.

A post shared by frank body (@frank_bod) on

In 2017 start-ups have consistently been brave and filled niche gaps in the market that larger brands have been unwilling to risk, and it has paid off.

Recently we came across new beauty brand JECCA, who has created a line of makeup specifically for trans customers.

And Function of Beauty lets consumers create bespoke shampoos depending on their hair type and goals. They can create 12 billion different combinations of ingredients.

REPRESENT DIVERSITY OR BE LEFT BEHIND

We have talked a lot about diversity in beauty over the past year and in 2018, we think the issue is only going to get more important.

Fenty Beauty created a buzz earlier this year when it released with 40 shades of foundation, a scale that many established beauty brands can’t or won’t match.

ASOS Face & Body promoted a similar message with their first major promotional video which featured a diverse cast of models and the promise of everything costing under $20. And more brands are taking up the cause of makeup for older women, such as RoC.

More importantly, those brands that don’t at least provide for a diverse audience are going to get called out on it. Nivea might be all for promoting diversity in Europe and the US, but in Ghana, they are promoting a skin lightening lotion called “Natural Fairness”.

And Dove’s “tone-deaf” ad, showing a black woman taking off her t-shirt to reveal a white woman, was immediately slammed by consumers.

BREXIT AND THE ECONOMY

With the UK currently deep in intense Brexit negotiations and still suffering the effects of a weakened post-referendum pound, could the economy have a detrimental effect on the beauty sector?

The bad news is that most forecasters are predicting further slowdown in economic growth next year. This year, growth is expected to be around the 1.5% mark, down from 1.8% in 2016. 2018 should see somewhere around 1.4% growth.

The good news, though, is that beauty and personal care is an incredibly resilient market, so should outperform the general economy.

2018 – THE SAME, JUST DIFFERENT?

The common thread that runs through the above is that none are new challenges, more a continuation of current issues that we expect to simply intensify this year.

Good luck tackling them, plus whatever else 2018 throws up!

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