So, we heard you have a booming beauty brand (congrats!) and are looking for the best way to use marketing to make a pretty penny. You’ve come to the right place.
It’s no surprise that the beauty industry holds a lot of promise when it comes to profitability and growth. In the last year alone, the beauty and personal care industry market value has grown from $483B in 2020 to $511B in 2021, and is expected to exceed $715B by 2025! If WE were a beauty brand, there’s no doubt we’d want a piece of that pie, too.
But while we wish to say that a beauty-ful brand and pretty products are all that you need to makeup your slice of the profits, it’s far from being that simple.
Don’t get us wrong, your products and brand are absolutely important, but this isn’t about you. This is about your consumers. Success in makeup marketing online means diving deep into who they are, how to find them, and more importantly, how to keep them coming back. How you provide value to them. Because if they’re not coming back, you’re not hitting your growth goals or making a profit.
Okay, this still is a little bit about you.
Beauty Ecommerce via Paid Media:Your Guide to Success
Like many digital marketers, we’re data people. We love analyzing metrics, interpreting analytics, creating formulas, and mapping out spreadsheets full of big, juicy data points (yes, really) as much as the next agency, but our focus is solely on impactful, actionable ones. So follow along closely here.
When it comes to the success (re: growth, impact, profits) of your beauty brand, only four metrics truly matter: visitors, conversion rates, lifetime values, and variable costs. To put it simply:
(Visitors x Conversion Rate x Lifetime Value) – Variable Cost = Profits
Okay, you’re saying, that totally makes sense, but… how do you, the beauty brand, start putting this equation to work? Don’t worry, you already know the answer (hint: that’s why you’re here). Digital marketing!
Marketing via paid media platforms (PPC, paid social ads) is the most impactful way to start raking in profits because it allows you to manipulate these variables in order to find and define what success looks like (and feels like) for your brand.
With that being said, let’s dive deeper into what each of these variables means, and tactics to try behind discovering the who, what, where, and how of digital marketing ecommerce for cosmetics and beauty brands.
Makeup Marketing Tactics to Increase Site Visitors
If you want to sell your products, you need people on your site to buy them. And the number one best marketing tactic to increase site traffic is to tap into paid social (social media) advertising platforms.
Social media marketing opens up the big, bold, beautiful world of targeting users based on their interests, online/app behavior, content they follow and engage with, and so, so much more. And there’s almost no better industry than beauty for paid social advertising – beauty products make up the second largest product category for engagement across social platforms.
No matter the platform you choose, advertising on social media allows you to open up the top of your sales funnel by targeting relatively passive consumers. We say “relatively passive” because while they are not actively using a search engine like Google or Bing to find beauty products like yours to purchase, they are still exhibiting online behavior and interests that show some type of intent related to what your brand offers.
Advertising via social media can also hit users in all stages of the sales funnel, which makes it another essential tactic for those looking to break into the online beauty scene. Now, more than ever, users are turning to social media for brand discovery. As of 2019, a whopping 37% of internet users who purchased beauty products in the last month discovered the brand via ads seen on social media.
Opening up your sales funnel to hit cold and warm users is a key factor in our equation, because it hits both the Visitors variable, and the Lifetime Value variable. Cold users increase your site traffic, which you can then continue to engage with via remarketing to foster their relationship with your brand, in time converting them to warm users who make a purchase (or multiple). We’ll touch more on this in both of the following sections, but for now, let’s stay focused on how to optimize your audience volume by sending the right users to your site.
Simply funneling the highest number of users to your site to increase visitor volume is not the way to go. You first need to find out who your ideal audience is, and then send them to the right place or product.
In the world of beauty, specifically, brands just starting out in digital marketing, you don’t want to target audiences that are too broad. They are already oversaturated with competitors, and users are already seeing so much content that it will be impossible to stand out. Grow the right traffic with super targeted audiences, and then build specific funnels for these audiences around your key products. In this way, you can make a bigger impact in a smaller pool of users, because you’re offering them niche products that they actually need (making them more likely to convert).
Now that we’ve covered the “how” of increasing your traffic with social media advertising, let’s talk more about the “who” of these audiences. It’s no secret that millennials and gen z’ers are the biggest drivers of the cosmetic industry. But to drive this home a little harder, let’s talk stats:
- In the US alone, millennials and gen z’ers have above average expenditures on personal care products, and an index of 122 on cosmetics products, compared to other shoppers.
- To take it further, 29% of those millennials have been reported to make purchase decisions based on media (or online reviews), which is 3x greater than that of Gen X’ers and 6x more than baby boomers.
- Finally, millennials and gen z’ers have over $1 TRILLION in direct spending power.
These younger generations of consumers have been on mobile and on social their entire lives. And as they enter the job market, their buying power grows. These generations are practically begging to purchase your products. So let’s do both you and them a favor: introduce paid social campaigns to your digital marketing strategy to connect your products with the people who want to buy them most.
Hot tip: Want to take it to the next level? Expand your ecommerce campaigns beyond paid social into Google Shopping.
For buyers still in the consideration phase, they may not be ready to buy via the ads they see on social. Many users turn to the ol’ Google machine for continued research about different brands and comparing products. This is where you can serve ads based on the products users have been searching for, based on data from your customer feed.
Google shopping can be one of the most impactful ecommerce campaigns your beauty brand decides to run, because the level of purchase intent can be much higher than on social, but it takes dedication and upkeep. You must be able to manage and maintain your data feed continuously to ensure your ads are able to serve.
You want the big bucks? You gotta work for ‘em.
Hot Tip: (because we’re all jazzed up about this): If you have the capacity to (continuously) create videos for ads, tap into another brand awareness tactic with YouTube Ad campaigns. Beauty is the leading YouTube content category among women, made up of millions of viewers. This means millions of eyes on your ads to learn about your brand, while they’re already watching videos related to products that you may carry. Sounds almost too easy if you ask us.
How to Improve Your Beauty Brand’s Conversion Rates
Ah, the almighty conversion rate. We consider this to be the holy grail of KPIs. A strong conversion rate for ecommerce brands like yours means $$$! And we know you’re here for that.
Leveraging this variable in our equation to more profits is more nuanced than simply defining your audience and sending those users to your site. Increasing traffic is child’s play, comparatively. When you’re first dipping your toe into digital marketing, conversion rate is where you’ll be doing a LOT of hypothesizing, testing, and reporting. Here are a few questions to get you goin’:
What’s Your [USP]?
The most important factors influencing consumer behavior (beyond price or location) are special sales, unique products, and rewards programs. This is where we need to be straight up with you. Are you offering these? And are they, honestly, good enough?
Nowadays, consumers expect at least a 10%-15% coupon code for their first purchase, in exchange for their email address of course. Seasonal sales, birthday sales (yours AND theirs) are also a given. If they’re going to buy from you, they want to be able to earn points or enroll in a loyalty program to use towards a future purchase (hello: consumer delight for them, recurring income for you).
These are just the bare minimum to pique their interest. In order to stand out in this uber competitive industry, you need to sprinkle these on top of a product so unique that consumers MUST shop your brand. Can you speak to the quality of your product? Can your product be tailored to the consumer? Personalized in any way? How exclusive is your online experience? Why would they buy your product over competitors?
Hot tip: Due to rising incomes, consumers are way more considerate of product quality, effectiveness, and ingredients over price. Find your USP outside of monetary value and undercutting prices, hone in on the quality of your product being superior to competitors.
If your product isn’t both unique and high quality, all the sales, coupons, and loyalty programs in the world won’t be compelling enough to get them to spend their hard earned dollars on your products.
How Thumb-stopping is Your Creative?
The number one tactic we can recommend for a killer conversion rate is killer creative. Killer creative goes way beyond a pretty picture of your product. Your creative must highlight product quality if you want it to convert. You must get creative in the ways it can be used, applied, etc – show it in action (with real human beings).
Your creative is the first thing consumers see when they first interact with your brand. Take the USP(s) you’ve determined and translate them into a story about your brand and products. We recommend following our Creative Commandments.
- It must be visually appealing and intriguing.
- Will it stop a user from their endless scroll? How will it pique their interest?
- It must be clear and compelling.
- How are you highlighting the quality of your product? Does it communicate the USP in that first interaction?
- It must be fresh and engaging.
- Are you using multiple creative formats or A/B testing? How frequently are you introducing new creative to ensure consumers don’t get fatigued?
- It must be inclusive.
- Is your creative showcasing diverse individuals? How are you representing buyers across different races, ethnicities, ages, and abilities?
Hot tip: beauty buyers who value quality are 64% more likely to shop directly from a cosmetics brand’s website, rather than a retail chain’s site. Show them what you’re made of (literally) with your creative!
In the world of paid social, creative is queen. Treat it like such 👑
How Seamless is Your UX?
This question is two-fold, as we need to think about the buyer’s experience when they’re shopping on social media through your ecommerce campaigns, and how your website experience lends itself to ease of purchase.
We love reducing barriers to entry; in the case of ecommerce, reducing barriers to purchase. Whether you’re using a platform that allows buyers to shop your products in-app, or your call-to-action on social campaigns are urging users to “buy now” on-site, you need to make sure that no matter which method they choose to shop, that it is an easy, seamless, and streamlined process from first look to purchase.
On social media, a great way to do this is to utilize the in-app shopping experience available on some platforms. But specific to on-site UX, there are some conversion rate optimization best practices to consider implementing. Luckily, most ecommerce platforms like Shopify or Woocommerce either have these best practices available on the platform, or offer apps and plugins that enable you to give them a go!
- Email captures
- Use OptinMonster to add an engaging or gamified pop up on your site that offers new customers to get X% off their first purchase when they enter their email
- Reviews on product pages
- Shopify offers a product reviews app to easily integrate customer reviews into your product pages
- Trust seals and badges
- Payment trust badges found in the Shopify app store can boost sales conversions and contribute to social proof
- User generated content
- WordPress apps like 10Web Instagram Feed allow you to create an Instagram gallery on your site from user posts when they use a specific hashtag
- Paid plans on Shopify allow you to use third party tools like ReCharge and Bold for subscriptions
- Upsells (in-cart or post-purchase)
- Visit the Shopify app store for post-purchase app integrations like AfterSetll
All these, combined with lightning fast site speed and a site optimized for mobile user’s experience will have you well on your way to slaying your conversion rates.
Hot tip: Are you feeling overwhelmed with all the methods to employ? You’re in luck, this is our specialty. Learn more about how our digital marketing services can revolutionize your conversion rates.
The tactics to improve your conversion rate are a culmination of all digital marketing efforts (testing, creative, user experience) and the sales funnel to finalize each purchase. We know this seems like a lot to look out for, but these are all essential in order to get money back into your pocket. Thanks for hanging in there, but stay tuned – this next section is even more important.
Finding Your Untapped Potential: LTV for Beauty Brands
You wanna know where the real profit from digital marketing comes in? Lifetime value is your key. This is your cash multiplier and a factor that will be essential to building your business over the long term. But it’s a factor that is most often overlooked or goes unreported for many businesses. We say, no more.
What exactly is LTV, you may ask? (Great question, LTV is one of THE most important ecommerce metrics). Lifetime value represents the total amount of money a customer is expected to spend in your business or on your products during their lifetime.
Because we’re working with digital marketing strategies, we have to layer on the CAC, or customer acquisition cost. CAC measures the relationship between a customer’s lifetime value and the cost of acquiring them through our paid marketing efforts. This ratio (LTV / CAC) is one of the biggest success indicators for determining whether a channel is right for you, and the return on investment for each ecommerce campaign. Let’s put it into action:
On Instagram for example, it may cost you $75 dollars to acquire a customer for the first time, and that first purchase might be $16. But if they return and buy that same product monthly, after 6 months their LTV is $96, and your LTV/CAC has become 96/75, or a 1.28 ROI. After a year, it will be a 2.5 ROI.
Lifetime value will help you assess which consumers are most profitable for your business. The true power of understanding LTV will help you identify your gateway products, your money maker products, and the ways in which you can continuously provide value to your customers over time, in ways that keep them coming back for more (and increasing your recurring revenue streams). Customers with high LTV is a strong indicator of product-market fit, brand loyalty, and recurring revenue. And that’s crucial to growing your business.
So how do beauty brands successfully optimize LTV?
To get started, first determine 30-, 60-, or 90-day LTV based on their first product purchased. You can optimize this first product purchase via strategic customer journeys and hyper-targeting paid social campaigns (we talked about these when discussing sending quality traffic to your site). Hyper targeting the right audiences will also help you reduce costs, contributing to your overall LTV.
Create individual product funnels where you can offer customers the niche products they actually need, increasing their likelihood of converting. This is how you get them in the door, but don’t get too greedy with this first sale. Remember that you are building a relationship, over time, with each consumer. First, only give them what they need, then upsell them after you’ve earned their trust. They’ll give you brand loyalty in return.
Remember this hyper-targeting when you employ remarketing campaigns. Make sure you’re not displaying irrelevant products to users when you’re retargeting them in your campaigns. This is one of the easiest ways to break their trust: making them think that you don’t know them after they’ve practically told you what they want and need.
In fact, when employing remarketing campaigns, consider the replenish rates of the products they have bought. If the replenish rate is 60 days, run a remarketing campaign that targets them about 45-60 days after their purchase to remind them to re-up their product! This is an easy way to increase repeat purchases that increase each consumer’s LTV.
Does a recent purchase remarketing campaign sound a little too complicated? Go the tried and true way of subscriptions. Offering product subscriptions (which, hint hint, often come with a discount), are a mindless way to generate revenue repeat purchase streams. Allow consumers the convenience of being cared for by your brand.
Hot tip: Email marketing for retention can be a critical tactic to improving LTV and maximizing your revenue. Encourage subscriptions to your email list with a special offer (say, 10% off?), and use this to drive purchases down the line.
Don’t Forget about Variable Costs
The last little bit of our equation all boils down to variable costs. Now this is something that is not as complicated as traffic, conversion rates, and LTV (thank goodness). All you need to do is track what costs are changing and account for them when computing profitability.
For example, if you are seeing costs rise as orders rise, this would be considered a variable cost. Sound easy enough? Good. Let’s give this a wrap with an example to tie this whole thing together.
For many beauty brands, a common tactic to improve both conversion rate and LTV is a beauty quiz. Considering you’ve already determined your audience and platform through which you will increase eyes on your brand and traffic to your site, you can market a quiz for consumers to complete in order to determine, say, their skin type. This compelling creative and intriguing offer funnels traffic to your site, where users take the quiz (soft conversion rate!). Upon completing the quiz, consumers are then provided with personalized results, pushing them to a product tailored to their needs. Here, they either hard convert by purchasing the product, or they’re not ready, this is where you remarket this product to them until they make the purchase later down the line. If the product works for them, they trust your brand and come back for more, increasing their LTV.
The right traffic, plus conversion rates, plus recurring revenue (minus those variable costs) equals scalable profit for your brand. Voilà!
Ready to Wrap it Up, Queens?
The rise of social shopping lends itself to increased opportunities for ecommerce brands like yours to utilize digital marketing efforts in a way that can completely transform the way you reach your customers and scale profitability.
But, as veterans of the digital marketing landscape, we also offer some advice. Both paid social marketing and the beauty industry are precarious and sensitive to changing consumer trends. Platforms, creative, trending styles, and of-the-moment products alike come and go at a moment’s notice. You need to be nimble and adapt in order to stay in the game.
That’s why we recommend Intuitive partnerships. You are the badass brand who knows beauty trends like the back of your hand. We’re the digital marketing gurus who can devise the right marketing strategies that put money back into your pocket. Together, we can scale your business to radically new heights.
Interested? Schedule your free consultation.