By  on April 30, 2007

Now that beauty executives have proven shoppers will buy cosmetics online, retailers and manufacturers are charging ahead with more dynamic, multi-channel approaches to e-tailing in the hopes of sealing a larger deal.

Numerous companies, including Sephora, Bare Escentuals, The Body Shop and Lancome, have recently updated their web efforts -with video clips and blogs, among other techniques-to encourage people to stay on their sites and browse longer. In doing so, their strategy is to try and strengthen their brands' images in the minds of consumers, who, in turn, will buy more. And many say that tactic is working.

Last year, online cosmetics and toiletries sales in the U.S. totaled $924 million (?681.9 million/£464.3 million), a 18.9% rise year-on-year, according to London-based tracking firm Euromonitor International. Thanks largely to upped marketing flair, that business is expected to grow even further. Online beauty sales in the U.S. are forecast to hit $1.09 billion by year-end and $1.28 billion in 2008.

Of course, compared to the overall $23.54 billion beauty industry, which incudes sales from color cosmetics, fragrance, hair care and skin care, such revenues still only represent a drop in the bucket. It's not been easy for beauty e-tailers so far. Seven years following the dot-com implosion, competition in cyberspace remains tough.

"There's not a lot of space for pure online retailers, particularly with the presence of Sephora," said Heather Dougherty, New Yorkbased senior Internet analyst for Nielsen/NetRatings tracking firm, referring to the world's biggest prestige beauty e-tailer, owned by LVMH Moët Hennessy Louis Vuitton, which industry sources expect will ring up $100 million this year. By comparison, they say the topfi ve beauty brand sites generate $15 million to $20 million annually.

Yet, e-tailers provide a key window for a brand, particularly among consumers who can't easily access products in the real world. Already numerous beauty e-tailers represent some manufacturers' and retailers' single largest door sales-wise. That's true for Sephora, whose U.S. e-tail site went live eight years ago, according to David Suliteanu, president and chief executive officer of Sephora U.S.A.

It's the same for some of the Estee Lauder Cos.-owned companies. "Most of our branded websites are the brands' largest retail door in the world, and they have been for years," said Dennis McEniry, president of the Estee Lauder Cos. Online. "It's one of those unheralded success stories. We have not seen e-commerce slow down at all since the late Nineties, and now the trend is accelerating around the world."This pickup is largely due to increasingly integrated marketing efforts. Mineral makeup company Bare Escentuals, for instance, airs a TV infomercial 540 times per week that stars company ceo and pitchwoman Leslie Blodgett, who gives makeup tips and touts before- and-after photos. Along with a toll-free number through which viewers can order product, the infomercial features the address of the brand's website, bareminerals. com, where product kits may be purchased. It also directs people to its retail partners' websites, where individual products may be bought.

On, for instance, Bare Escentuals' homepage features videos on how to use its products. Further, to help solve problems linked with shade selection, introduced in April a technology allowing people to scroll cursors over a row of on-screen faces to select the one most like their own. Then, a suggested shade is put forward.

"Bare Escentuals' web business continues to evolve 10% to 15% faster than its brick-and-mortar business," said Diane Miles, president of the San Francisco-based company.

"We like to work with our wholesale partners and look at the web as a means of connecting with our customers," she said, referring to, and has yet another take on e-tailing. Whereas most beauty brands and retailers sell their products in either the mass-market or prestige arena, sells brands such as Revlon, Bliss and Annick Goutal through both, in the form of its signature site and (its parent company since 2001). Since the two sites are linked, customers can shop across both during the same visit, tossing items in one shopping basket that goes through one checkout process. executives say such a strategy is in line with consumer habits these days.

"There is a trend in the industry of consumers trading up and trading down," said Kathleen McNeill, general manager of beauty. com and general manager of beauty for, explaining that the sites together allow shoppers to seamlessly purchase cotton swabs for $3 and Elizabeth Arden Prevage antiaging treatment for $150 during one visit.

Skin- and hair-care products make up the core of the businesses, but color cosmetics is one of the fastest-growing categories, said Mc- Neill. To mitigate some of the risk of buying beauty online, where consumers can't touch products, and offer a 100% return guarantee on color cosmetics. They also try to bolster their scent sales through sampling.What's more, in late March, created a profile on the social networking site MySpace. Its MySpace page, which features makeup tips and touts product freebies plus special offers, amassed 3,000 "friends" after just two weeks, said McNeill. A wide network of friends offers a broader outreach vehicle through which companies can communicate key brand messages.

Executives would not divulge the company's online sales but said last year's business increased 36%, and that growth is expected to be even faster in 2007.

Other beauty companies are using their e-tail sites to converse with people about social change alongside giving them product information. In late March, The Body Shop launched a micro-site (an offshoot of its global web effort, called wise-woman. - net to introduce a line for mature skin, as well as to celebrate age. The site prominently features The Body Shop founder Anita Roddick, and also include message boards, visitors' photos from celebrations and interviews with various "wise women," which are updated monthly, said a spokesman for The Body Shop.

"The product range links with our key value of self-esteem," he explained. "Wise Woman is about celebrating age." He noted thebodyshopinternational. com focuses on communicating brand information and company values.

The Body Shop's main e-tail site,, which first went live in the U.S. two years ago and in the U.K. in September 2006, also focuses on communicating similar messages.

"The main goal is to have a relationship with the products and the values of the brand," said the spokesman. "A brand like ours can engage women on both levels, and it's that interconnectivity that is exciting." Of course, the aim of the site is also to generate income.

Beauty executives say their e-tail sites serve numerous functions.

"It isn't exclusively click-and-buy," explained Suliteanu, of sephora. - com. "It is also about click-and-learn. A huge part of's mission has to do with education."

In addition to featuring tips and tricks from beauty insiders, the site has a blog, fashion-week coverage and user-generated content, including a recent video contest asking people to divulge what makes them blush. Cybernauts can also communicate with Sephora beauty advisors.Lauder uses its sites as an educational platform, as well. At, for instance, people can interact (via live chat groups, e-mail or telephone) with a beauty advisor, who has received the same training as the brand's department-store sales associates.

Many beauty firms say they're charging ahead with e-tail site openings. L'Oreal-owned Lancome will open seven e-commerce sites in new markets to make its total 20 by year-end. Odile Roujol, general manager of Lancome International, said e-commerce sites are particularly important for emerging beauty markets, such as Brazil and India-or other areas-where distribution channels are not yet well developed.

A double-digit percentage of people visiting, for instance, have not previously purchased the brand in department stores, said the company's McEniry.

For its part, direct-seller Avon Products has relaunched its online effort to integrate its representative site,, and its consumer site,, as well as tout a new marketing campaign, Hello Tomorrow. It is Avon's first globally integrated marketing effort including advertising, products and sales brochures. The joint effort of avon. - com and allows each Avon sales representative to have her own web page. From a comprehensive template including business tools, such as promotional e-mails, an Avon sales representative can personalize her web page, which includes information on Avon products, plus locating representatives and also gives the option of ordering over the Internet, explained Pattiann McAdams, Avon's general manager of the company's online division.

Since the effort was launched in September 2006, 25% of Avon's sales staff has created their own web stores, and 70% of its sales representatives ordered products online, said McAdams. She noted the integrated site gives representatives an enhanced earnings opportunity, because it allows them to receive orders 24 hours per day. Avon charges a fee for the representative site per product campaign, but the fee is waived if one item is sold.

"The Internet is helping us have our stores open all the time. It keeps our representatives competitive," said McAdams. "Our integration of and is key for a company that has been online for so long. It's an evolution."

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