“Demographics are dead.” As stated by Maxwell Luthy, director of trends and insights at TrendWatching, this point — that today’s consumers are relinquishing traditional demographic constraints like age and gender in favor of individual needs and values — was driven home at the CEW Beauty Insider Series panel at the Union League Club Tuesday night.
WWD Beauty Inc. editor Jenny B. Fine moderated the panel, which consisted of Luthy; Kelly McPhilliamy, managing director and head of consumer products and consumer and retail investment banking at Wells Fargo Securities, and Elana Drell Szyfer, chief executive officer of Laura Geller New York.
McPhilliamy opened the discussion with a presentation of the megatrends influencing “post-demographic” consumerism: urbanization and increasing interest in healthy living and sustainability. The acceleration of these key trends, combined with the rise in e-commerce, has “upended” the way consumers purchase products.
Digitalization has armed consumers with access to and increased knowledge of a growing variety of brands across different categories, placing them firmly in control of who wins in the market. And this increased consumer awareness has led to what Luthy’s firm has coined “the expectation economy.” He added that “brands have to meet and surpass rapidly changing expectations. Increased awareness and knowledge of brands has increased the competitive landscape.”
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Luthy listed Make Up For Ever’s campaign with transgender model Andreja Pejic as a prime example of this new mindset. As consumers accept and embrace blurring gender boundaries, they expect brands and companies to follow suit. If they don’t, brands risk losing relevancy.
“It’s evening out the playing field between small companies and large companies,” McPhilliamy agreed. “Dispruptors are capitalizing. They’re bringing creativity and newness to the market.” She ticked off e.l.f. Cosmetics, an online-born cosmetics brand that has evolved into retail, and OGX, a salon-inspired hair brand that has climbed to the top of the mass market as examples of key successful disruptors.
And disruptors have never been better poised for financial success. “They’re well financed,” said McPhilliamy. “Ten to 20 years ago you didn’t have nearly [as many] the number of private equity firms [now] investing in beauty.”
Disruption can happen even from within an existing brand. Szyfer discussed how Laura Geller New York was reinvented and repositioned for omnichannel growth after years of success via direct-selling on QVC.
“Start with [the] brand and story and understand what it is you’re putting out there,” Szyfer said. “We tried to understand what it was about Laura that resonated with core consumers — it was her authenticity and approachability.”
Szyfer said defining core brand values were key in honing in on new consumers in different channels. “By defining the brand values, which are about empowerment and authenticity, which for us [is] a universal human desire — that’s been incredibly resonant.”