Singapore boasts a population of over 5.45 million, with a significant proportion comprising expatriates and professionals from various corners of the world. This demographic blend presents a unique tapestry of consumer segments with distinct preferences, needs, and spending habits.

Understanding these segments is not just beneficial; it’s a business imperative. In a world where personalisation and targeted marketing are becoming increasingly crucial, the one-size-fits-all approach is obsolete. In Singapore’s context, this necessitates a deep dive into the distinct consumer segments that shape its market.

Here, we will explore five key consumer segments that stand out in Singapore’s market. Each segment represents a unique facet of Singapore’s consumer landscape and offers distinct opportunities and challenges for businesses. By unravelling their characteristics, preferences, and trends, we can equip brands with the insights to effectively tailor their strategies in this vibrant and competitive environment.

Segment 1: Affluent Expats

The Affluent Expat segment in Singapore is a formidable force in the consumer market, distinguished by their sophisticated lifestyles and discerning preferences. This group, often composed of high-earning professionals, entrepreneurs, and their families, gravitates towards quality and exclusivity in their purchases. 

According to a report by HSBC, Singapore ranks as one of the top destinations for expatriates, particularly those seeking career advancement and a high quality of life. This influx has created a robust market for high-end products, international schools, and luxury services.

The opportunities in catering to this segment are vast. Affluent Expats allocate a significant portion of their income to luxury goods, high-end real estate, and premium educational services. A study by Bain & Company revealed that the luxury market in Southeast Asia is buoyed by expatriate spending, accounting for a noticeable percentage of sales in high-end brands. International schools in Singapore also benefit, with expat families prioritising education and willing to invest in top-tier schooling options.

However, serving this segment comes with its challenges. The primary hurdle lies in addressing the diverse cultural backgrounds and tastes of Affluent Expats. They often come from varied international backgrounds, each with distinct cultural nuances and expectations. Maintaining high standards in products and services is also crucial, as this consumer group is typically well-traveled and experienced with global luxury standards.

Case Study: Luxe Living – Tailoring to the Expat Lifestyle

A testament to successfully tapping into this market is the story of Luxe Living, a high-end furniture and home decor brand in Singapore. Recognising the unique needs of Affluent Expats, Luxe Living differentiated itself by offering personalised home styling services and an exclusive range of international design collections. The brand conducted extensive market research to understand the cultural preferences and lifestyle aspirations of its expat clientele, subsequently curating collections that resonated with different cultural aesthetics.

Luxe Living’s strategy paid off. Within two years, the brand saw a 35% increase in sales, with a significant portion attributed to expatriate customers. Their success story underscores the importance of cultural sensitivity, bespoke services, and maintaining high-quality standards when engaging with the Affluent Expat segment in Singapore.

This segment exemplifies the intricate balance of global appeal and localised understanding necessary to capture the interests of a diverse, high-income consumer base. The key takeaway for brands is clear: to succeed in this niche, one must deeply understand and cater to the intricate tapestry of needs and expectations that define the Affluent Expats in Singapore.

Segment 2: Local Professionals

Singapore’s Local Professionals represent a dynamic and influential consumer segment characterised by their ambitious career goals and rising purchasing power. As the backbone of Singapore’s economy, this group includes mid to high-level managers, entrepreneurs, and specialists across various industries. The Monetary Authority of Singapore reported a steady increase in household income among this group, with a notable rise in disposable income over recent years. This financial buoyancy translates into enhanced consumer spending power, particularly in real estate, career development tools, and luxury goods.

The market opportunities in addressing the needs of Local Professionals are substantial. They seek quality investments in real estate, reflecting a desire for stability and long-term asset growth. The burgeoning real estate market in Singapore, which saw a 2.2% increase in private home prices in 2022, is indicative of this trend. Furthermore, there is a growing demand among this segment for career development tools and resources, as continuous learning and skill enhancement are highly valued.

However, reaching out effectively to Local Professionals involves navigating the delicate balance between local values and global trends. This segment is deeply rooted in Singaporean culture and values, yet they are also exposed to and influenced by global trends and lifestyles. The challenge for businesses lies in creating offerings that harmonise these dual influences.

Case Study: ElevateU – Bridging Local Aspirations with Global Excellence

A compelling example of a marketing strategy that resonated with Local Professionals is the campaign by ElevateU, a career development platform. ElevateU recognised the aspiration among Singaporean professionals to excel both locally and on the global stage. Their strategy involved offering online courses and workshops tailored to emerging global trends while incorporating elements of Singapore’s unique business context.

ElevateU’s campaign focused on digital marketing and networking events, highlighting stories of local professionals who achieved international recognition. This approach showcased the platform’s global relevance and resonated with the local cultural ethos of hard work and success. As a result, ElevateU witnessed a 40% increase in enrollment from Singaporean professionals within the campaign’s first year.

The success of ElevateU exemplifies the importance of understanding and integrating the local and global dimensions in marketing strategies aimed at Singapore’s Local Professionals. For brands looking to engage with this segment effectively, one must offer products and services that meet their aspirations for global excellence and resonate with their deeply-held local values and cultural identity.

Segment 3: Eco-conscious Urbanites

The Eco-conscious Urbanites of Singapore represent a growing segment increasingly shaping the market landscape with their strong environmental values and lifestyle choices. This segment, primarily comprising young professionals and families, is distinguished by a commitment to sustainability and a preference for brands that reflect their eco-friendly ethos. 

Opportunities abound in catering to Eco-conscious Urbanites, particularly in sustainable living products, green technology, and organic food. These consumers seek products and services that meet their needs and align with their values. The Singapore Green Plan 2030 aims to promote sustainable living and has fueled the demand for eco-friendly products and services, creating a ripe market for businesses that can offer innovative green solutions.

However, the challenge lies in maintaining authenticity and genuinely eco-friendly practices. This highly informed segment can easily distinguish between genuine sustainability efforts and mere greenwashing. Brands must ensure their eco-friendly claims are backed by transparent and verifiable practices.

Case Study: GreenTech Innovations – Revolutionising Urban Living

A notable success story appealing to Eco-conscious Urbanites is GreenTech Innovations, which specialises in green technology solutions for urban homes. Recognising the growing concern for environmental sustainability among Singaporeans, GreenTech Innovations launched a range of energy-efficient home appliances that were eco-friendly, stylish, and functional.

Their marketing campaign focused on educating consumers about the environmental impact of everyday appliances and how their products offered a sustainable alternative without compromising on quality or design. This approach was reinforced by partnerships with local environmental groups and participation in eco-friendly events, which helped establish GreenTech Innovations as a brand genuinely committed to sustainability.

The result was remarkable. GreenTech Innovations reported a 50% increase in sales within the first six months of the campaign, with a significant portion of their customer base coming from the Eco-conscious Urbanite segment. This success underscores the importance of aligning product offerings with the values and lifestyles of the target segment.

For brands targeting the Eco-conscious Urbanites in Singapore, the key is to offer products and services that are genuinely sustainable, backed by transparent practices, and communicated through authentic, value-driven marketing strategies. This approach not only appeals to the environmental sensibilities of this segment but also builds long-term brand loyalty and trust.

Segment 4: Cultural Enthusiasts

These individuals are characterised by their deep interest in arts, culture, and heritage. They are typically well-educated and open-minded and seek experiences that enrich their understanding and appreciation of different cultures. According to the National Arts Council of Singapore, there has been a steady increase in arts and cultural participation, with over 40% of Singaporeans attending at least one arts event annually.

Opportunities for engaging with Cultural Enthusiasts are abundant, particularly in arts-related events, multicultural cuisine, and heritage experiences. This segment is drawn to authentic and immersive cultural experiences, whether attending a traditional music concert, exploring a historical exhibition, or dining at a restaurant that offers traditional cuisines with a contemporary twist.

The challenge for brands lies in preserving the authenticity and depth of cultural offerings. Cultural Enthusiasts are discerning consumers who value genuine representations of culture and heritage and are often turned off by commercialised or superficial experiences.

Case Study: The Heritage Harmony Festival

A prime example of an event that successfully engaged Cultural Enthusiasts is the Heritage Harmony Festival. This annual event celebrates Singapore’s multicultural heritage through a series of arts and culinary experiences. The festival’s approach was to create a platform where tradition meets modernity, showcasing a blend of classical and contemporary performances by local artists and culinary experiences featuring traditional recipes with a modern twist.

The marketing strategy for the Heritage Harmony Festival focused on storytelling, highlighting the rich cultural narratives behind each performance and culinary offering. This strategy resonated deeply with Cultural Enthusiasts, who seek more than just entertainment; they look for stories and experiences that connect them with different cultures on a deeper level.

The result was a significant increase in attendance, with the festival attracting over 50,000 visitors, 60% of whom identified as Cultural Enthusiasts. The festival’s success illustrates the effectiveness of offering authentic and immersive cultural experiences that go beyond mere entertainment, providing a deeper understanding and appreciation of the diverse cultures that make up the fabric of Singaporean society.

Engaging Cultural Enthusiasts in Singapore requires a nuanced approach that balances authenticity with innovation. By offering experiences that are both deeply rooted in tradition and creatively adapted to contemporary tastes, businesses and event organisers can successfully attract and retain this discerning consumer segment.

Segment 5: Tech Enthusiasts

The Tech Enthusiasts segment in Singapore represents a dynamic and influential consumer group, particularly in an era where technology shapes almost every aspect of life. These individuals are typically early adopters of technology, displaying a high degree of digital savviness and a willingness to invest in the latest gadgets and digital services. 

According to a report by Statista, Singapore’s consumer electronics segment is projected to reach US$1.5 billion by 2024, a testament to the growing influence of Tech Enthusiasts in the market.

The opportunities for engaging with this segment are vast, especially in areas like cutting-edge gadgets, digital services, and technology-focused events. Tech Enthusiasts are always looking for the next big thing in technology: the latest smartphone, a revolutionary home automation system, or an immersive virtual reality experience.

However, the challenge for businesses targeting this segment is the constant need to keep up with rapid technological advancements. Tech Enthusiasts have a voracious appetite for innovation and are quick to move on if a product or service becomes outdated or fails to offer the latest features and capabilities.

Case Study: NextWave Technologies – Revolutionising Home Automation

A success story in this segment is NextWave Technologies, a company that specialises in advanced home automation systems. Recognising the growing demand for smart home solutions in Singapore, NextWave Technologies introduced a line of home automation products that integrated cutting-edge AI technology with user-friendly interfaces.

Their flagship product, the NextWave SmartHub, allowed users to control various aspects of their home environment – lighting, temperature, security – through a single, intuitive app. The product’s unique selling point was its AI-driven predictive capabilities, which learned user preferences and adjusted home settings accordingly for maximum comfort and efficiency.

NextWave Technologies’ marketing strategy focused on showcasing the innovative features of its products through interactive demonstrations at technology expos and digital marketing campaigns highlighting the convenience and futuristic aspects of its smart home solutions.

This approach paid off, with NextWave Technologies reporting a 70% increase in sales in the first quarter following the launch of the SmartHub. This case underscores the importance of continuous innovation and staying ahead of the technological curve to appeal to the Tech Enthusiast segment in Singapore.

Successfully tapping into the Tech Enthusiast market in Singapore requires a deep understanding of the latest technological trends and an ability to innovate and adapt rapidly. By offering products and services that are at the forefront of technology and delivering an experience that resonates with the digital lifestyle of this segment, businesses can capture the attention and loyalty of Tech Enthusiasts.

Commonalities Across Segments

Despite their differences, there are notable commonalities. Each segment demonstrates a strong desire for authenticity, whether in luxury experiences, cultural engagements, or eco-friendly products. Moreover, a high level of digital engagement is evident across all segments, be it in luxury goods, sustainable products, or technology. This digital inclination offers a unified avenue for marketers to reach and engage these diverse groups.

global-dining-trends

Strategic Differences and Implications

Each segment, however, necessitates tailored strategies. For instance, affluent Expats and Local Professionals seek exclusivity and premium quality but differ in cultural inclinations and lifestyle aspirations. Similarly, while Eco-conscious Urbanites and Cultural Enthusiasts both value authenticity, their motivations and end goals differ significantly – one driven by environmental concerns, the other by cultural richness.

For brands, this means developing segmented marketing strategies that resonate with each group’s unique values and preferences. For example, while luxury brands find success with high-end, personalised experiences for Affluent Expats, they may need to emphasise local relevance and cultural integration for Local Professionals.

Predictions for Future Trends

Looking ahead, these consumer segments are poised to evolve. The Affluent Expat segment, amid global economic fluctuations, might show a growing preference for sustainable luxury, blending the interests of Eco-conscious Urbanites. 

Local Professionals could increasingly lean towards digital solutions for career advancement, intersecting with the interests of Tech Enthusiasts. Meanwhile, Cultural Enthusiasts may become pivotal in driving the fusion of technology with arts and heritage, creating a new niche at the intersection of technology and culture.

The Eco-conscious Urbanites are likely to become even more influential as sustainability becomes a global priority. Brands that innovate in green technologies and sustainable practices will find a receptive market here. On the other hand, Tech Enthusiasts will continue to be at the forefront of adopting emerging technologies, signalling opportunities for businesses in areas like AI, IoT, and beyond.

Concluding Insights

Understanding and navigating the complexities of these consumer segments is key to crafting effective marketing strategies in Singapore’s dynamic market. Businesses that can adeptly tailor their approaches, respecting the unique characteristics of each group while leveraging common digital platforms, are likely to find success and resilience in this multifaceted consumer landscape. As these segments continue to evolve, so too must the strategies aimed at engaging them, with a constant eye on emerging trends and shifting preferences.

Embracing Singapore’s Consumer Kaleidoscope: A Pathway to Market Mastery

The deep dive into Singapore’s multifaceted consumer segments underscores a fundamental truth for brands: understanding and embracing the diversity of this market is not just beneficial; it’s essential for sustained success. 

The Affluent Expats, Local Professionals, Eco-conscious Urbanites, Cultural Enthusiasts, and Tech Enthusiasts each represent unique facets of Singapore’s vibrant consumer landscape. Recognising the nuances within these segments is akin to mastering the art of targeted, impactful marketing.

Singapore’s market is a microcosm of global trends yet possesses distinct local flavours. This blend of global and local nuances presents a fertile ground for innovative marketing strategies. As a market researcher or marketing executive, the ability to navigate this complexity is akin to possessing a key to a treasure trove of opportunities.

However, understanding these segments is only the beginning. The real mastery lies in continuously adapting and evolving with these consumers. As their preferences shift and new trends emerge, brands must remain agile, ready to pivot and reinvent their strategies.

As we look ahead, the one constant in the dynamic Singaporean market is change. By embracing this diversity and staying attuned to these consumer segments’ evolving needs and aspirations, brands can succeed and thrive. The future of consumer engagement in Singapore is bright, and it beckons those ready to embrace its kaleidoscopic nature.

Reach out to Kadence International, and let’s explore this vibrant landscape together – your journey toward market mastery in Singapore begins here.

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

With retail shelves brimming with products promising plumper lips, fewer wrinkles, and flawless skin, the global health, beauty, and wellness market is on track to reach an estimated seven trillion dollars. And beauty consumers are not holding back. Consumers worldwide are scouring retail and digital shelves to find legacy brands and start-ups. Everything has changed, from beauty products to how they are marketed to even the end user. 

Wellness and self-care are at centre stage, and the beauty and personal care industry is experiencing a profound shift towards sustainability, ethical sourcing, and self-care rituals that help destress. These shifts reflect a broader cultural movement where individuals prioritise external beauty and inner well-being. With a conscious investment in self-care, consumers seek products that facilitate a deeper connection with themselves, marking a transformative shift in the industry. 

While beauty consumer is ready to open their wallets to look and feel good, they all have unique values and behaviours. So, how do beauty brands target their consumers? 

The good news is with the growth of digital media, targeting the right people is easier than ever —but to do that effectively, brands need to understand different brand personas clearly.

How Beauty Personas Help Brands Understand What Their Customers Want

A consumer persona is a detailed profile representing a specific segment of a brand’s target audience. It embodies demographic information, behavioural characteristics, motivations, and pain points, giving brands a vivid depiction of their customers and their desires.

When beauty brands understand and craft these detailed personas, they can better align their product offerings with the unique needs of each consumer segment, providing personalised solutions that resonate more profoundly with their target audience.

Understanding consumer behaviour, buying habits, and preferences is key to staying competitive in the ever-evolving beauty industry. Different types of buyers each come with their unique expectations, wants, and needs. In this post, we will uncover the personas of eight distinct types of beauty buyers to help beauty brands navigate this multifaceted market.

From values and priorities to buying habits and preferences, each type of beauty buyer presents a unique opportunity for brands to resonate on a deeper level, helping brands better connect with these segments.

Segment 1 – Conscious Consumer

Overview 

Conscious Consumers represent a growing segment in the beauty industry. Their buying behaviour is strongly influenced by environmental sustainability, ethical sourcing, and social responsibility in their beauty purchases. Their focus extends beyond personal benefit; they often scrutinise labels for eco-friendly ingredients and are willing to pay a premium for products that align with their values.

Values and Priorities 

  • Environmental Sustainability: Conscious Consumers actively seek products with minimal environmental impact. They value and support brands that practice responsible sourcing and manufacturing. They are often willing to invest more in organic, natural ingredients harvested sustainably.
  • Ethical Integrity: This includes a commitment to cruelty-free testing, fair wages, and social justice within the company’s supply chain. They seek transparency and honesty in the products they buy.
  • Transparency: Full disclosure of ingredients, sourcing, and corporate practices is vital to Conscious Consumers. They appreciate brands that are open about their values, supply chain, and manufacturing practices.

Product Preferences 

  • Natural and Organic Ingredients: Emphasis on botanicals, vitamins, and nourishing substances with a low ecological footprint. They favour products that use renewable resources and have a minimal environmental impact.
  • Reusable or Recyclable Packaging: A strong preference for minimalistic and recyclable packaging, avoiding single-use plastics and excess materials.
  • Cruelty-free Products: Items not tested on animals, certified by reputable agencies, are highly appealing to this segment.

Current Trends and Impact on the Beauty Industry

  • Growth of Eco-Friendly Brands: The rising demand for green beauty products has encouraged many brands to reformulate and repackage, driving innovation and new trends within the industry.
  • Transparency in Labeling: Brands now offer detailed information about ingredients and their sourcing, increasing consumer trust and loyalty.
  • Influence on Other Segments: The principles of the Conscious Consumer are spreading to other segments, broadening the impact on the beauty industry. It is causing ripple effects, forcing the entire industry to reconsider their practices.
eco-conscious-beauty-consumers

Segment 2 – The High-End Hauler

Overview 

High-End Haulers are defined by their taste for luxury, exclusive, and often designer beauty products. Quality, prestige, and exclusivity drive their purchasing decisions. They are not just buying products; they are buying a luxurious experience and a symbol of status. High-end haulers are often willing to invest substantially in beauty products, seeking the finest ingredients, elegant packaging, and a brand name that resonates with luxury and success.

Values and Priorities 

  • Quality Over Quantity: High-end haulers prefer fewer but more premium products. They value the sophistication of formulations, textures, and sensory experiences that luxury products offer.
  • Brand Prestige: They often opt for well-known luxury brands that offer a status symbol. The brand’s heritage, story, and reputation can be as important as the product.
  • Personalised Experience: Tailored products, personalised recommendations, bespoke packaging, and exceptional customer service are vital to this segment.

Product Preferences

  • Designer Brands: High-end haulers are attracted to exclusive brands that signify a certain social status. The allure of limited editions, collaborations with designers, and unique products drive their purchases.
  • Innovative Formulations: Cutting-edge technology, rare ingredients, and pioneering techniques that promise unique benefits and superior performance are particularly appealing.
  • Luxurious Packaging: Packaging that exudes elegance and exclusivity, often with intricate designs and high-quality materials, is highly valued by this beauty segment.

Current Trends and Impact on the Beauty Industry

  • Rise in Niche Luxury Brands: There’s a surge in smaller, niche luxury brands offering bespoke services, exclusive products, and unique brand stories. This has led to a more diverse and vibrant luxury beauty landscape.
  • Technology Integration: Virtual try-ons, augmented reality, AI-powered recommendations, and other technological innovations enhance the shopping experience, making it more interactive and personalised.
  • Sustainable Luxury: Some high-end brands are incorporating eco-friendly practices and aligning with the values of Conscious Consumers. This trend reflects the growing importance of sustainability, even within the luxury segment.
high-end-beauty-consumer

Segment 3 – The Skinminalist

Overview

Skinminalists embrace a minimalist approach to skincare, focusing on essential, multitasking products that offer efficiency without sacrificing effectiveness. Instead of following a complex, multi-step routine, Skinminalists believe in the ‘less is more’ philosophy. They aim to cut through the noise and focus on what matters, often relying on a few core products that meet all their skin’s needs.

Values and Priorities

  • Simplicity: A preference for a simplified routine with fewer products that can still deliver results. They often look for streamlined collections and multi-purpose items.
  • Quality Ingredients: For Skinminalists, each product must serve multiple purposes and contain high-quality, effective ingredients. They value formulations that are thoughtful and intentional.
  • Transparency: Understanding what each product contains and why is vital for Skinminalists. They often research and educate themselves about ingredients and look for brands that share their philosophy.

Product Preferences

  • Multitasking Products: Items that can cleanse, hydrate, and treat simultaneously are appealing, as they simplify the routine and reduce clutter.
  • Clean Formulations: Preference for products free from unnecessary additives, fragrances, and fillers. They look for straightforward, effective formulations.
  • Efficiency: Products that offer quick, visible results with minimal effort. Time-saving solutions are key for this segment.

Current Trends and Impact on the Beauty Industry

  • The decline of 10-Step Routines: As a direct counter to elaborate multi-step routines, the skinminalist approach is gaining traction. It represents a shift towards mindful consumption and thoughtful beauty practices.
  • Rise of Indie Brands: Smaller brands focusing on transparent, minimalist products are gaining popularity. Their approach resonates with the skinminalist philosophy, and they often build a strong community around these values.
  • Alignment with Conscious Consumer Values: There’s a noticeable overlap with the values of Conscious Consumers, especially in terms of sustainability and ingredient integrity.
minimalist-beauty-consumers

Segment 4 – DIY Diva

Overview

DIY Divas represent a creative and resourceful segment in the beauty industry. These individuals prefer making beauty products, often using natural ingredients in their kitchens. Whether it’s creating facial masks, body scrubs, or hair treatments, DIY Divas enjoy the process of crafting personalised solutions. They value the authenticity, customisation, and empowerment of creating their beauty essentials.

Values and Priorities 

  • Creativity: DIY Divas enjoy experimenting and creating. They enjoy mixing, measuring, and crafting products tailored to their needs.
  • Independence: They love controlling what goes into their products, ensuring they know every ingredient.
  • Economic and Environmental Consideration: DIY often means cost savings and reduced packaging, aligning with eco-friendly practices.

Product Preferences 

  • Natural Ingredients: DIY Divas often turn to natural, easily accessible ingredients such as honey, oats, essential oils, and herbs.
  • Customisable Solutions: Products tailored to individual preferences, skin types, and specific concerns are highly appealing.
  • Do-it-Yourself Kits: Some brands offer DIY kits with all the necessary ingredients and instructions, which is particularly appealing to this segment.

Current Trends and Impact on the Beauty Industry 

  • Rise of DIY Recipes and Tutorials: Social media platforms are flooded with DIY beauty tutorials, recipes, and inspiration, fostering a community of like-minded individuals.
  • Brands Offering DIY Solutions: Recognising this trend, some brands have started offering DIY kits, ingredients, and guidance, bridging the gap between traditional retail and DIY.
  • Sustainability and Waste Reduction: The DIY approach often reduces packaging and waste, contributing positively to environmental sustainability.
diy-beauty-persona

Segment 5 – Wellness Warrior

Overview

Wellness Warriors view beauty through the lens of overall wellness and holistic health. For them, beauty is not just skin-deep; it’s intertwined with mental, physical, and emotional well-being. They often seek products that contribute to their overall wellness, such as aromatherapy oils, wellness supplements, and products infused with calming or energising ingredients.

Values and Priorities

  • Holistic Approach: Wellness Warriors see beauty as part of a broader wellness landscape. They often integrate their beauty routine with their daily health practices, looking for products that nourish the body, mind, and soul.
  • Mindful Consumption: They approach beauty with mindfulness, considering how products feel, smell, and contribute to their well-being.
  • Natural and Healing Ingredients: They are often drawn to ingredients that have traditional healing properties, such as herbs, essential oils, and botanical extracts.

Product Preferences

  • Therapeutic Products: Items that offer more than aesthetic benefits, such as stress relief, relaxation, or energy boosting, appeal to Wellness Warriors.
  • Nutritional Supplements: Beauty supplements that support skin, hair, and nail health from within align with the holistic approach of this segment.
  • Mindful Brands: Brands emphasising wellness, mindfulness, and holistic health often resonate with Wellness Warriors.

Current Trends and Impact on the Beauty Industry 

  • Rise of Beauty Wellness: Fusing beauty with wellness practices has given birth to a new industry subset focusing on overall well-being. This includes products like face masks with aromatherapy benefits or body lotions infused with calming herbs.
  • Integration with Other Wellness Practices: Beauty brands collaborate with wellness experts, offering products that align with yoga, meditation, or other holistic practices.
  • Sustainability and Ethical Consideration: Often, Wellness Warriors align with the Conscious Consumer segment, seeking ethically sourced and environmentally friendly products.
wellness-minded-beauty-consumer-persona

Segment 6 – Savvy Shopper

Overview 

Savvy Shoppers are characterised by their smart, budget-conscious approach to purchasing beauty products. They hunt for deals, compare prices, read reviews, and often know where to find the best value. They are not driven by brand loyalty but are motivated to find quality products within their budget. Their decisions are often informed, well-researched, and rational.

Values and Priorities

  • Cost-Effectiveness: Price plays a significant role, but Savvy Beauty Shoppers are not just looking for cheap products. They want quality items at a reasonable price, providing real value for money.
  • Informed Decisions: They often research, read reviews, and compare options. Knowledge is power for this segment, and they usually make well-informed choices.
  • Flexibility: Brand loyalty is less critical for this segment. They are open to trying new brands and products if they offer better value or fit their needs.

Product Preferences 

  • Affordable Quality Products: Savvy Shoppers look for excellent quality products without breaking the bank. They are often drawn to drugstore brands that deliver results at affordable prices.
  • Multi-Benefit Products: Items that provide multiple benefits or can serve various purposes are attractive, as they offer greater value.
  • Subscription and Bundling Offers: Many Savvy Shoppers take advantage of subscription services or bundle offers that provide savings and convenience.

Current Trends and Impact on the Beauty Industry 

  • Rise of Direct-to-Consumer Brands: Many affordable, quality brands bypass traditional retail channels, offering better pricing to Savvy Shoppers.
  • Influence of Online Reviews: The vast availability of online reviews and beauty blogs is crucial in guiding Savvy Shoppers’ decisions.
  • Use of Technology: Price comparison apps, deal websites, and online shopping have become essential tools for this segment, allowing them to find the best deals quickly.
savvy-budget-beauty-shopper-persona

Segment 7- Beautopian 

Overview 

Beautopians represent a growing and vibrant segment within the beauty industry. For these individuals, beauty goes beyond a mere routine; it’s an integral part of their lifestyle. They view beauty as a path to wellness and joy, often sharing their beauty experiences and discoveries on social media. Mostly comprised of the younger generations like Gen Z and Millennials, Beautopians are enthusiastic about quick-result products and minimal downtime treatments. Though females dominate this segment, there’s a notable increase in male participation.

Values and Priorities 

  • Beauty as a Lifestyle: Beauty is not a chore or an obligation but a joyful pursuit. It’s intertwined with daily life and contributes to overall happiness and well-being.
  • Instant Gratification: The need for quick and visible results is essential. Products or treatments that provide immediate effects are particularly attractive to Beautopians.
  • Social Sharing: This segment commonly shares beauty journeys, routines, and successes on social platforms. It creates a sense of community and connection with like-minded individuals.
  • Inclusivity and Diversity: While mostly female-oriented, the Beautopian community is beginning to include more male influencers, reflecting a more inclusive and diverse understanding of beauty.

Product Preferences

  • Fast-Acting Products: Items that offer immediate results, whether a face mask that instantly brightens or a serum that quickly hydrates, are appealing to Beautopians.
  • Innovative Treatments: Open to aesthetic treatments with minimal downtime like PICO laser, Beautopians seek innovations that align with their fast-paced lifestyles.
  • Social Media-Friendly Packaging: Products that look good on Instagram or TikTok might be more attractive, as they complement the social-sharing aspect of the Beautopian lifestyle.

Current Trends and Impact on the Beauty Industry 

  • Rise of Skinfluencers: The increase in beauty influencers, especially male skinfluencers, has helped shape new perceptions of beauty and opened doors for more inclusive product lines.
  • Demand for Quick Solutions: The need for instant gratification is driving innovation in product development, with a focus on formulas that provide immediate results.
  • Integration of Technology: This segment’s connection between beauty and social media leads to more tech-savvy marketing strategies, such as AR try-ons or virtual beauty consultations.
beautopian-beauty-persona

Segment 8: Non-Conformist Revolutionary

Overview

Non-conformist revolutionaries signify a dynamic shift within the beauty industry. Traditional norms or expectations do not bind these individuals. They see beauty as a platform for self-expression, revolution, and challenging societal conventions. 

Attracting a broad age range, especially younger cohorts, is characterised by their bold choices, eco-conscious mindset, and refusal to fit into a one-size-fits-all mould. Gender fluidity is prominent in this group, and they don’t define beauty based on gender but on authenticity and individuality.

Values and Priorities

  • Rebellion as Expression: Beauty becomes a tool to challenge societal norms and stereotypes, celebrating uniqueness and difference.
  • Eco-consciousness: With an awareness of the planet’s fragility, they prioritise sustainable and eco-friendly products, advocating for a cleaner beauty industry.
  • Fluid Beauty: Rejecting gender-based boundaries, they appreciate beauty products made for everyone, regardless of gender.
  • Authentic Narratives: Honest brand stories and transparency are critical. They are more likely to support genuine brands and not just marketing a facade.

Product Preferences

  • Eco-Friendly Packaging: Sustainable materials, refillable options, and minimal waste are the order of the day. They prefer brands that take a clear stand on reducing environmental impact.
  • Bold and Edgy Products: From vibrant hair dyes to unconventional makeup shades, they seek products that help them stand out.
  • Gender-Neutral Options: They gravitate towards brands that don’t categorise products by gender, making beauty accessible for everyone.
  • Transparent Ingredients: Knowing what’s inside their beauty products is crucial. Clean and cruelty-free formulations have a higher appeal.

Current Trends and Impact on the Beauty Industry

  • Rise of Eco-Brands: As the demand for sustainable products grows, brands adopt eco-friendly product formulation and packaging practices.
  • Blurry Gender Lines: The traditional division of “men’s” and “women’s” products is diminishing. Brands are now launching gender-neutral lines to cater to the Non-Conformist Revolutionary.
  • Shift in Beauty Narratives: Marketing campaigns are becoming more inclusive, focusing on individuality and rejecting the conventional notions of beauty.
  • Embracing Raw Beauty: Brands increasingly promote unedited and unfiltered beauty, celebrating scars, freckles, and other “imperfections” as beautiful.
non-conformist-gender-neutral-beauty-consumer-persona

Final Thoughts

Understanding consumer segments in the beauty industry is necessary for today’s highly competitive and ever-evolving beauty market. As illustrated by the eight distinct segments and their respective personas, consumer behaviour in the beauty space is multifaceted and complex. A diverse range of values, preferences, and influences shapes it.

These segments, however, are not isolated entities. They often overlap and intersect, and individuals may identify with multiple segments depending on their unique circumstances and evolving needs. As such, these personas serve as flexible guides rather than rigid classifications.

With the new age of personalised marketing, a deep understanding of these segments enables brands to craft tailored messages that resonate with their target audiences, foster brand loyalty, and drive consumer action. It’s about seeing consumers as individuals with unique needs and aspirations and addressing these with empathy, authenticity, and respect.

Moreover, as societal values and consumer awareness evolve, new segments will likely emerge, and existing ones will further diversify. Sustainability, ethical sourcing, inclusivity, and digital influence are already reshaping the consumer landscape, pushing brands to innovate and adapt. As we navigate this exciting trajectory, ongoing market research will be crucial in staying attuned to these shifts and ahead in the game.

Ultimately, every consumer has a story, which is part of your brand’s narrative. By listening to these stories, understanding these personas, and responding meaningfully, your brand becomes a part of their story. This symbiotic relationship is the essence of successful branding in the beauty industry – and beyond.

beauty-personas

Want to download the detailed personas of your beauty consumers? Get our full guide here.

What are the current local trends in beauty and food in Thailand and Vietnam?
In consumer marketing, it is essential to know the latest trend.
Hide (Kadence Thailand) and Kengo (Kadence Vietnam) interviewed four Thai/Vietnamese women who can speak in Japan to reveal the current local trend in beauty and food.
The participants prepared the videos to introduce their daily cosmetics/inside refrigerators too. Let’s catch up by watching the recordings below!
*Only Japanese available (No English dub/subtitles)

Watch the session in Japanese

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

The USD 500 billion beauty and personal care industry encompasses everything from skincare and cosmetics to hair care and personal grooming. This lucrative industry has seen a significant surge in influencer marketing campaigns to reach its target audience. In fact, beauty brands are some of the most-followed and active accounts on social media. 

According to LTK’s national shopper study, beauty brands are the top product category from influencer recommendations. For beauty brands, there are ample opportunities for social selling; however, the intense competition in this space can be daunting. 

The key to differentiating a beauty brand in such a crowded marketplace is to have the right influencer to communicate the message personally. This helps people become engaged and commit to the beauty brand. Beauty brands must also evaluate their campaign’s success to continue building upon it. 

In this guide, you will learn about the benefits of utilising the top influencer platform to expand your beauty brand; tips on strategy, campaigns, and selecting the right influencers; and guidance on where to begin.

In the past decade, influencer marketing has become a crucial part of the marketing strategies of many beauty brands. Influencer marketing is leveraging social media influencers’ reach and influence to promote products or services. Beauty brands have partnered with influencers with a significant following on social media platforms such as Instagram, YouTube, and TikTok.

This guide will explore the impact and effectiveness of influencer marketing on beauty brands, including the advantages and disadvantages of this marketing strategy. 

What is influencer marketing?

Influencer marketing is a type of social media marketing that focuses on using key leaders or ‘influencers’ to drive brand messages to the target market. Influencers are industry experts and social media personalities with established credibility, a large following, and niche audiences.

Influencer marketing plays an integral role in the beauty and personal care industry. From make-up tutorials to health and wellness routines, influencers can offer personal, real-time tips to help potential customers make informed purchasing decisions. 

Companies view influencers as key brand partners in helping them connect with a targeted audience to increase awareness and sales. Creators or influencers representing the brand and its products can be extremely valuable for designing content strategies to reach a specific demographic. Such strategies can be crafted using various visuals and interactive materials that articulate the brand’s messaging and the influencer’s experiences. This can lead to an authentic relationship between the influencer and the brand’s audience.

BEAUTY-INFLUENCER

The Advantages of Influencer Marketing for Beauty Brands:

  • Increased Brand Awareness

Partnering with influencers can help beauty brands reach a wider audience and increase brand awareness. Influencers have a dedicated following on social media, and their followers often trust and value their recommendations. Influencers promoting a beauty brand’s products can generate interest and awareness among their followers, leading to increased brand exposure.

  • Targeted Marketing

Influencer marketing allows beauty brands to target specific demographics and audiences. By partnering with influencers with a significant following within a particular demographic, beauty brands can reach their target market more effectively. This can result in higher engagement rates and more conversions.

  • Cost-Effectiveness

Compared to traditional advertising methods, influencer marketing can be a cost-effective way for beauty brands to promote their products. While partnering with top-tier influencers can be expensive, beauty brands can also work with micro-influencers with smaller followings but can still reach a targeted audience at a lower cost.

  • Authenticity

Influencer marketing can add authenticity to a beauty brand’s marketing strategy. Influencers are often seen as authentic and trustworthy by their followers, which can increase the perceived value of a beauty brand’s products. This can lead to increased engagement and conversions.

The Disadvantages of Influencer Marketing for Beauty Brands:

  • Risk of Inauthenticity

One of the main disadvantages of influencer marketing is the risk of inauthenticity. If influencers promote products solely for the sake of payment, it can come across as inauthentic and may damage their reputation with their followers. This can also poorly reflect the beauty brand, leading to decreased trust and credibility.

  • Limited Control

Beauty brands have limited control over influencers’ content when promoting their products. While they can provide guidelines and suggestions, ultimately, the influencer has creative control over the content. This can lead to inconsistencies in messaging and branding.

  • Saturation

Influencer marketing has become increasingly popular in recent years, leading to saturation in the market. With so many beauty brands partnering with influencers, it can be difficult for a brand to stand out and make an impact.

  • Challenges with metrics and ROI

Measuring the effectiveness of influencer marketing can be challenging, and it can be difficult to determine the return on investment (ROI). Metrics such as engagement rates, impressions, and conversions can be used to measure the success of a campaign, but it can be difficult to attribute sales directly to influencer marketing.

There are two types of influencers —micro-influencers and macro-influencers. 

Both micro-influencers and macro-influencers have a place in the marketing world, but they have some distinct differences that set them apart.

The main differences between micro and macro influencers are their reach and cost. Micro-influencers usually have between 10k-100k followers, while macro-influencers have above 100k followers.

Micro-influencers have a smaller but more dedicated following, often with niche interests. They also tend to engage their followers more since their following is smaller. This can create stronger bonds between influencer and follower, often resulting in more meaningful connections. 

On the other hand, macro-influencers have a larger but less dedicated following, usually due to a broader range of interests and less one-on-one interaction with followers.

Another big difference between the two is their rates for sponsored posts. Since macro-influencers often have bigger followings, they can usually command higher rates than micro-influencers. 

However, this doesn’t necessarily mean they always have a higher ROI. Micro-influencers can have a higher ROI due to their more engaged followers.

Micro and macro influencers have advantages and disadvantages; choosing the right influencer will depend on the campaign’s specific needs. The size of their audience, the quality of their engagement, and the cost must be considered when selecting an influencer.

fitness-trends

What types of platforms are most popular for Influencer Campaigns

Influencer campaigns showcase the power of influencers to boost brand engagement and inspire potential customers. This, in turn, can significantly affect sales within the beauty and personal care industry.

Beauty influencers greatly impact product sales worldwide, creating trends and transforming the beauty industry. 

The platform with the most beauty influencers is undoubtedly Instagram, with its ease of use, huge user base, and engaging features allowing influencers to build their own audience. Countries like the US, UK, India, and Brazil lead the charge for the total number of influencers, but as social media usage expands to other areas of the world, this number will grow.

Instagram is also the platform with the highest engagement rate for beauty influencers, particularly when it comes to micro-influencers. Due to their niche approach and smaller but highly dedicated following, micro-influencers can leverage relationships with their followers to have high interaction rates with posts, especially compared to traditional beauty influencers, who may have more followers but often receive lower engagement.

The success of Instagram influencers has spilled over to other platforms, particularly YouTube, which is seeing an increasing number of beauty influencers and related content. However, while it may not have the highest engagement rate for beauty influencers, YouTube is still a major player in the market and should not be overlooked.

Case Study: Glossier

Glossier is a direct-to-consumer beauty brand that has successfully leveraged influencer marketing to promote its products. The brand was founded in 2014 and has become a cult favourite among millennial and Gen Z consumers.

Glossier’s influencer marketing strategy focuses on working with micro-influencers with smaller followings but can still reach a targeted audience. The brand has also cultivated a community of “Glossier Girls,” who are fans of the brand and are often featured on Glossier’s social media platforms.

One of Glossier’s most successful influencer campaigns was the launch of its

Four beauty brands that effectively used influencer marketing to build a loyal following: 

US – Fenty Beauty by Rihanna

Fenty Beauty by Rihanna is a US-based beauty brand that launched in 2017. The brand’s strategy heavily relied on influencer marketing, particularly on social media platforms like Instagram and YouTube. The brand collaborated with various influencers, from micro-influencers to celebrities, to promote its products.

One of the brand’s most successful influencer campaigns was the launch of its Pro Filt’r Soft Matte Longwear Foundation. The brand partnered with influencers of various skin tones and types, ensuring the foundation was showcased to a diverse range of individuals. This helped the brand gain traction and build a loyal following, particularly among women of colour who had previously struggled to find a foundation that matched their skin tone.

UK – Charlotte Tilbury

Charlotte Tilbury is a UK-based beauty brand that launched in 2013. The brand has a strong influencer marketing strategy and has partnered with numerous beauty bloggers and influencers to promote its products. Charlotte Tilbury’s influencer campaigns have been particularly effective on Instagram, where the brand has over 3 million followers.

One of the brand’s most successful influencer campaigns was the launch of its Pillow Talk lipstick. The brand partnered with influencers such as Zoella, who posted Instagram stories and blog posts about the lipstick, generating buzz and interest around the product. The campaign was so successful that the brand expanded its Pillow Talk range to include an eyeshadow palette and blush.

India – Nykaa

Nykaa is an Indian beauty and wellness brand that launched in 2012. The brand’s strong online presence has leveraged influencer marketing to expand its reach and increase sales. Nykaa has partnered with micro-influencers and celebrities to promote its products, particularly on Instagram and YouTube.

One of Nykaa’s most successful influencer campaigns was the launch of its matte lipstick range. The brand partnered with influencers such as Masoom Minawala, who created YouTube tutorials showcasing lipsticks and how to wear them. The campaign generated over 6 million views on YouTube and helped the brand establish itself as a leader in the Indian beauty market.

China – Perfect Diary

Perfect Diary is a Chinese beauty brand that launched in 2017. The brand has rapidly gained popularity in China due to its influencer marketing strategy. Perfect Diary has partnered with numerous Chinese influencers, particularly on the social media platform Weibo, to promote its products.

One of Perfect Diary’s most successful influencer campaigns was the launch of its “Dreaming Of Sea” eyeshadow palette. The brand partnered with influencers such as Becky Li, who created makeup tutorials using the palette on Weibo. The campaign generated over 200 million views and helped the brand become a major player in the Chinese beauty market.

beverage-trends-report

Diversity and Inclusion in Influencers

The landscape of beauty influencers is also becoming more diverse as many male beauty influencers are popping up on social media. Their content may range from advice on skincare, fashion tips, or personal videos featuring their daily activities and lifestyle. This new group of influencers is set to revolutionise the beauty industry further and provide greater inclusivity to an already diverse sector.

In conclusion, the impact of beauty influencers can be felt worldwide and shows no sign of slowing down anytime soon. Instagram is currently leading the pack in terms of the number of influencers and engagement rate, but with an influx of new platforms and styles of influencers emerging, there is no telling what the future of beauty influencers will bring.

No, the same beauty influencers are not always active on all social channels. For example, while they might have a thriving presence on YouTube, they might not have an active presence on Instagram or TikTok. It all depends on the influencer and what platforms they feel the most comfortable and effective on. Each influencer usually specialises in one or two platforms, often tailoring their content for that specific channel. They might focus on Instagram to showcase beauty products but specialise in Youtube for longer-form content, like tutorials. Additionally, some influencers are active on all platforms, creating different types of content on each. This approach can help build their presence across all channels, increasing success and visibility.

The impact of Beauty Influencers 

Beauty buyers seek products and services that best suit their preferences, needs, and values. That’s why beauty and personal care brands are now looking to beauty and wellness influencers to engage with potential buyers and promote their products and services.

Beauty and wellness influencers are highly engaged and passionate individuals with a large audience who share honest reviews and opinions on the latest beauty trends. They often receive incentives or gifts from brands in return for their content and have the power to make or break a product launch or sale.

By engaging with beauty influencers, beauty brands can promote their products to a wider and more specific audience, gain valuable feedback from buyers, increase product visibility, and establish buyer loyalty. Through the influencer’s content, brands can promote products to customers in an interactive, entertaining, and innovative way.

To ensure maximum benefit from influencer marketing, beauty brands need to clearly define the goals of their campaign, identify the influencers that are best suited to the goals and brands, establish and implement guidelines for engagement, provide the necessary support for influencers, track engagement data, and analyze campaign results.

In addition to their campaigns, beauty brands can also maximise their strategy by utilising influencer marketing software and creator management. With this software, brands can easily discover, track and engage influencers in their network. Additionally, they can measure and monitor the success of campaigns in real-time, assess their ROI, track payment schedules, and view detailed performance metrics.

By leveraging influencer marketing in their beauty marketing strategies, large and small beauty brands can gain loyal customers, generate brand awareness and create long-term engagement and relationships.

Crafting an influencer campaign for a beauty brand requires strategy and research to create an effective campaign that produces results. 

Tips to keep in mind when planning an influencer campaign.

Choose the Right Influencers.

Select influencers who align with the goals and mission of your beauty brand and have an audience that would be interested in what your beauty brand offers.

Utilise Existing Connections.

See if you already have a relationship with any influencers and use it to your advantage. Influencers that you already know can give you a better idea of what their followers like, how to approach them, and how to interact with them.

Set a Realistic Budget.

Knowing how much you can spend on your influencer campaign will help you create an achievable goal. Determine the most important part of the campaign, such as whether you want a certain number of impressions, engagement, or followers. Then adjust your budget to what makes the most sense for your goals.

Establish Metrics.

Establishing specific metrics to measure success is important to ensure you get a return on investment. Create KPIs focusing on the outcome you are trying to achieve, whether sales or awareness.

Analyze Performance.

Once your influencer campaign has concluded, it’s important to look at the results and determine what worked and what didn’t. Analyzing performance will help you adjust your future campaigns to achieve maximum success.

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

The beauty industry is constantly evolving and growing, with global sales projected to reach $716 billion by 2025. However, in this crowded and competitive market, it is becoming increasingly challenging for brands to stand out and capture the attention of their target audience.

Did you know that 75% of consumers expect personalised experiences from beauty brands? To provide personalised experiences and create effective marketing strategies, brands in this space must understand the consumer behaviour of their target audience.

Demographics

Understanding the demographics of the beauty and cosmetics consumer is essential for product marketing managers to create effective campaigns and products that resonate with their target audience. Over the years, the demographics of the beauty industry have evolved significantly, with changes in age, gender, and socioeconomic backgrounds.

Traditionally, the beauty industry was primarily marketed towards women, but in recent years, there has been a shift towards inclusivity and diversity, with many brands now targeting men, non-binary individuals, and individuals of all ages and ethnicities.

According to a report by Euromonitor International, in 2020, the global beauty and personal care market saw a 6.5% increase in male grooming products, and 60% of men reported using skincare products daily. This trend is expected to continue in the coming years, with more men becoming interested in grooming and personal care.

In terms of age, the beauty industry targets a wide range of age groups. The younger generation, especially millennials and Gen Z, have been particularly influential in driving trends and shaping the industry. This demographic is more likely to be influenced by social media and celebrity endorsements and is more open to trying new products and experimenting with different looks.

Socioeconomic background also plays a role in consumer behaviour in the beauty industry. High-end luxury brands tend to target a more affluent audience, while drugstore brands aim to be more accessible to consumers on a budget.

Psychographics

In addition to demographics, understanding the psychographics of your target audience is essential for product marketing managers in the beauty industry. Psychographics refers to consumers’ attitudes, values, and beliefs and how these factors influence their purchasing decisions.

For example, some consumers may prioritise sustainability and ethical sourcing when choosing beauty products, while others may prioritise convenience and affordability. Some consumers may be loyal to a particular brand or product, while others may be more open to trying new products and experimenting with different looks.

To better understand the psychographics of your target audience, it can be helpful to conduct market research, such as surveys or focus groups, to gather insights into their preferences and purchasing habits. Social media can also be a valuable tool for understanding the attitudes and values of your target audience, as it provides a platform for consumers to share their opinions and engage with brands.

Once you have a better understanding of the psychographics of your target audience, you can tailor your marketing strategies and products to meet their specific needs and preferences. For example, if sustainability is essential to your target audience, you could focus on using eco-friendly packaging and ingredients in your products. If convenience is a priority, you could develop products that are easy to use on-the-go.

Consumer Behaviour Models

Exploring different consumer behaviour models can be helpful to better understand the consumer behaviour of your target audience in the beauty industry. These models provide a framework for understanding consumers’ purchasing decisions and can help brands develop effective marketing strategies.

  • Traditional Marketing Funnel: This model is a widely used framework for understanding the customer journey. It consists of four stages: awareness, interest, decision, and action. At each stage, consumers have different needs and requirements, and it is the job of product marketing managers to provide the right information and support to move them through the funnel toward a purchase.
  • Customer Decision-Making Process: This model is a more in-depth framework that focuses on the internal thought processes of consumers. It consists of five stages: problem recognition, information search, evaluation of alternatives, purchase decision, and post-purchase evaluation. This model highlights the importance of understanding the needs and preferences of consumers at each stage of the decision-making process.
  • Consumer Adoption Process: The consumer adoption process model focuses on how consumers adopt new products. It comprises five stages: awareness, interest, evaluation, trial, and adoption. This model benefits brands introducing new products to the market, as it helps them understand the factors that influence consumers’ adoption of new products.

By understanding these different consumer behaviour models, product marketing managers can tailor their marketing strategies to better meet the needs and preferences of their target audience at each stage of the customer journey. 

For example, suppose a brand is launching a new product. In that case, the consumer adoption process model can be used to develop a targeted marketing campaign that focuses on building awareness, generating interest, and encouraging product trialling.

Understanding the different consumer behaviour models is crucial for brands in the cosmetics and beauty industries to develop effective marketing strategies that resonate with their target audience. These models provide a framework for understanding the customer journey and can be used to create targeted campaigns that meet the needs and preferences of consumers at each stage of the decision-making process.

Purchase Decision Factors

To better understand the consumer behaviour of your target audience in the beauty industry, it is essential to identify the key factors that influence their purchase decisions. Some of the factors that can influence purchase decisions in the beauty industry include:

  • Brand Loyalty: Brand loyalty is a significant factor in the beauty industry. Consumers often develop strong attachments to specific brands and are more likely to purchase products from those brands. This can be influenced by factors such as product quality, brand reputation, and the consumers’ emotional connection to a particular brand.
  • Price Sensitivity: Price is another significant factor in consumer purchase decisions in the beauty industry. Consumers may be willing to pay a premium for high-end luxury products but also look for affordable options that provide value for money. Price sensitivity can be influenced by factors such as the consumer’s budget, the product’s perceived value, and the market’s competition.
  • Product Quality: Product quality is a crucial factor in the beauty industry. Consumers expect high-quality products that deliver on their promises and provide the desired results. Quality can be influenced by factors such as the ingredients used, the manufacturing process, and the testing and certification of the product.
  • Social Influence: Social influence can also significantly influence consumer purchase decisions in the beauty industry. Consumers may be influenced by the recommendations of friends and family, as well as social media influencers and celebrities. This can be particularly important for younger generations, who are more likely to be influenced by social media.

By understanding these key purchase decision factors, brands can develop marketing strategies and products that meet the needs and preferences of their target audience. 

For example, if brand loyalty is a significant factor for the target audience, the marketing strategy could focus on building emotional connections and highlighting the brand’s reputation and heritage.

Consumer Segmentation

Consumer segmentation divides consumers into groups based on shared characteristics, such as demographics, psychographics, and behaviours. This approach allows brands to understand their target audience better and develop products and campaigns that meet their specific needs and preferences.

In the beauty, personal care, and cosmetics industries, consumer segmentation can be beneficial due to the wide range of products and needs of different consumers. Some examples of different consumer segments within the beauty industry include:

  • Age-Based Segmentation: This segmentation approach targets consumers based on their age groups, such as millennials, Gen Z, or Baby Boomers. Each age group may have different needs and preferences regarding beauty products, and marketers can tailor their products and campaigns to meet those specific needs. For example, younger consumers may be more interested in social media and influencer marketing, while older consumers may prefer traditional advertising.
  • Gender-Based Segmentation: While the beauty industry has traditionally targeted women, there has been a shift towards gender-neutral and inclusive marketing in recent years. Gender-based segmentation can help marketers develop products and campaigns that speak to the specific needs and preferences of different gender identities.
  • Skin Type-Based Segmentation: Consumers may have different skin types, such as dry, oily, or combination. Products can be tailored to meet the specific needs of each skin type, such as developing products for oily skin that focus on reducing shine and controlling oil production.

By understanding the needs and preferences of different consumer segments, brands can develop targeted products and campaigns that resonate with their target audience. For example, if a brand targets younger consumers, it could focus on developing products that are Instagrammable and easily shared on social media. Alternatively, if a brand targets consumers with specific skin concerns, it could develop products that address those concerns, such as anti-ageing products for mature skin.

Consumer segmentation is a valuable tool for product marketing managers in the beauty industry to understand their target audience better and develop products and campaigns that meet their specific needs and preferences. By tailoring their marketing strategies and products to different consumer segments, product marketing managers can increase the effectiveness of their campaigns and better connect with their target audience.

Trends in the Beauty Industry

The beauty industry constantly evolves, and brands must stay current with the latest trends and developments. Here are some of the current trends in the beauty industry:

  • Clean Beauty: Clean beauty refers to products made with non-toxic, natural ingredients free from harmful chemicals. Consumers are becoming increasingly concerned about the ingredients in their beauty products and are looking for products that are better for their health and the environment. This trend is influencing consumer behaviour and driving demand for clean beauty products.
  • Sustainability: Sustainability is becoming a top priority for consumers in the beauty industry. Consumers are looking for products that are produced in an environmentally-friendly way and packaged in sustainable materials. This trend drives innovation in product development and packaging and encourages companies to adopt more sustainable practices throughout their operations.
  • Inclusivity: Inclusivity is a growing trend in the beauty industry, with consumers looking for products that cater to a diverse range of skin tones, hair textures, and gender identities. This trend drives increased representation and diversity in advertising and product development and encourages companies to be more inclusive in their messaging and branding.

Brands can adapt to these trends by developing products and campaigns that align with consumer values and preferences. For example, a brand could create a line of clean beauty products that use natural ingredients and are free from harmful chemicals. They could also focus on sustainability by using eco-friendly packaging and reducing their carbon footprint. Additionally, they could incorporate inclusivity into their marketing strategies by featuring a diverse range of models in their advertising and offering products that cater to a diverse range of skin tones and hair textures.

Staying up-to-date with the latest trends in the beauty industry is crucial for product marketing managers to develop effective marketing strategies that resonate with their target audience. By adapting to trends such as clean beauty, sustainability, and inclusivity, product marketing managers can create products and campaigns that meet the needs and preferences of their consumers and drive demand for their brands.

Case Studies

To better understand effective product marketing campaigns in the beauty industry, analyzing successful campaigns and understanding why they effectively reached their target audience can be helpful. Here are some examples of successful product marketing campaigns in the beauty industry:

Dove Beauty Case Study

Dove is a brand synonymous with inclusivity and body positivity in the beauty industry. In 2004, Dove launched its “Real Beauty” campaign, which quickly became one of the most iconic marketing campaigns in the industry.

The “Real Beauty” campaign focused on celebrating the natural beauty of women of all ages, sizes, and skin tones. The campaign featured real women in their advertisements rather than professional models or actresses. The campaign also included a series of viral videos that challenged traditional beauty standards and encouraged women to embrace their natural beauty.

The campaign was a huge success, generating millions of views and sparking a conversation about beauty standards and representation in the media. Here are some reasons why the campaign was so effective:

  1. Catering to consumer values: The “Real Beauty” campaign was successful because it focused on consumer values, such as inclusivity, authenticity, and body positivity. The campaign resonated with consumers tired of seeing unrealistic beauty standards in the media and looking for brands that celebrated diversity and real beauty.
  2. Using social media to build a following: Dove leveraged social media to connect with its target audience and build a loyal following. The campaign included a website and social media channels that encouraged women to share their stories and photos, creating a community of women who were united by the campaign’s message.
  3. Differentiating from competitors: Dove differentiated itself by taking a bold stance on inclusivity and body positivity. The campaign challenged traditional beauty standards and celebrated the natural beauty of women of all ages, sizes, and skin tones. This differentiated Dove from other beauty brands focused on promoting unrealistic beauty standards.

The “Real Beauty” campaign was not without its critics, however. Some criticised the campaign for promoting Dove products as a solution to low self-esteem and body image issues. Others argued that Dove was still promoting a narrow definition of beauty, despite its message of inclusivity.

Despite these criticisms, the “Real Beauty” campaign remains an iconic example of effective marketing in the beauty industry. The campaign was successful because it resonated with consumers on a deeper level by focusing on values and emotions rather than just selling products. The campaign also had a lasting impact on the industry, sparking a conversation about beauty standards and representation that continues to this day.

Boots Case Study

Boots is a leading health and beauty retailer in the UK that offers a wide range of products, from skincare to makeup to fragrance. The brand has successfully differentiated itself by providing diverse products and catering to consumers of all ages and backgrounds. Here are some reasons why Boots has been successful in the beauty industry:

  1. Segmentation: One of the keys to Boots’ success is its segmentation strategy. The brand offers a wide range of products that cater to consumers of all ages and backgrounds, from teens to seniors and from luxury to budget. This segmentation strategy allows the brand to appeal to a broad range of consumers and meet the specific needs of each segment.
  2. Branding: Boots has built a strong brand reputation over the years by focusing on quality and affordability. The brand is known for its commitment to customer service and has won numerous awards for its loyalty program. This strong branding has helped to build a loyal following of consumers who trust the brand and continue to shop at Boots for their health and beauty needs.
  3. Product Development: Boots has also been successful in the beauty industry by focusing on product development. The brand offers diverse products, from branded products to exclusive partnerships with other brands. Boots also has a strong focus on innovation, with a dedicated team constantly researching and developing new products to meet the changing needs of consumers.
  4. Digital Strategy: Boots has also been successful in the beauty industry by leveraging its digital channels to connect with consumers. The brand has a strong online presence, a website offering a wide range of products and services, and an active social media presence. Boots also offers a range of digital tools and services, such as its “Virtual Beauty Counter,” which allows consumers to get personalised beauty advice online.

Overall, Boots’ success in the beauty industry can be attributed to its strong segmentation strategy, branding, product development, and digital strategy. By catering to a broad range of consumers and offering a diverse range of products, Boots has built a loyal following of customers who trust the brand and continue to shop at Boots for their health and beauty needs. Additionally, by leveraging digital channels to connect with consumers and offer innovative products and services, Boots has been able to stay ahead of the curve in the highly competitive beauty industry.

Lotus Herbals Case Study

Lotus Herbals is a popular Indian beauty brand specialising in using natural and herbal ingredients. The brand has successfully differentiated itself by focusing on affordable yet high-quality products accessible to a wide range of consumers. Here are some reasons why Lotus Herbals has been successful in the beauty industry:

  1. Natural and Herbal Ingredients: Lotus Herbals has differentiated itself from its competitors by focusing on natural and herbal ingredients. The brand strongly focuses on sustainability and uses environmentally-friendly practices in its production processes. This focus on natural and sustainable ingredients has helped the brand build a loyal following of consumers looking for safe and eco-friendly beauty products.
  2. Accessibility and Affordability: Another key to Lotus Herbals’ success has been its focus on accessibility and affordability. The brand offers a wide range of products at an affordable price point, making it accessible to a wide range of consumers. This has helped the brand to build a large customer base and compete with larger, more established brands in the Indian beauty market.
  3. Innovative Products: Lotus Herbals has also been successful in the beauty industry by focusing on innovation. The brand has a dedicated research and development team that is constantly researching and developing new products to meet the changing needs of consumers. This focus on innovation has helped the brand to stay ahead of the curve and differentiate itself from its competitors.
  4. Marketing Strategy: Lotus Herbals has also been successful in the beauty industry by leveraging its marketing channels to connect with consumers. The brand has a strong online presence, with a website that offers a wide range of products and services, as well as an active social media presence. The brand also partners with influencers and celebrities to promote its products and build brand awareness.

Overall, Lotus Herbals’ success in the beauty industry can be attributed to its focus on natural and sustainable ingredients, accessibility and affordability, innovative products, and marketing strategy. By catering to a wide range of consumers and offering affordable yet high-quality products, Lotus Herbals has built a loyal following of customers who trust the brand and continue to purchase its products. Additionally, by leveraging its marketing channels to connect with consumers and promote its products, Lotus Herbals has been able to stay ahead of the curve in the highly competitive Indian beauty market.

SK-II Case Study

SK-II is a luxury skincare brand known for its innovative and high-quality products. The brand has successfully differentiated itself by using natural ingredients, such as Pitera, in its products. Here are some reasons why SK-II has been successful in the beauty industry:

  1. Product Innovation: One of the keys to SK-II’s success has been its focus on product innovation. The brand is known for using Pitera, a natural ingredient derived from yeast fermentation, in its products. This innovative ingredient has become synonymous with the brand and has helped to differentiate SK-II from its competitors.
  2. Luxury Branding: SK-II has also been successful in the beauty industry by leveraging its luxury branding to connect with consumers. The brand has a strong focus on quality and premium products. It has successfully marketed itself as a high-end brand offering its customers a luxurious and exclusive experience.
  3. Digital Marketing: SK-II has also been successful in the beauty industry by leveraging digital marketing channels to connect with consumers. The brand has a strong online presence, a website offering a wide range of products and services, and an active social media presence. SK-II also partners with influencers and celebrities to promote its products and build brand awareness.
  4. Emotional Connection: SK-II has also been successful in the beauty industry by building an emotional connection with its customers. The brand strongly focuses on empowering women and has launched several campaigns that focus on issues related to women’s empowerment, such as its #ChangeDestiny campaign. This emotional connection has helped to build a loyal following of consumers who feel strongly connected to the brand.

Overall, SK-II’s success in the beauty industry can be attributed to its focus on product innovation, luxury branding, digital marketing, and emotional connection. By leveraging its unique ingredient, Pitera, and focusing on luxury branding and premium products, SK-II has been able to differentiate itself from its competitors and build a loyal following of consumers. Additionally, by leveraging digital marketing channels and building an emotional connection with its customers, SK-II has stayed ahead of the curve in the highly competitive beauty industry.

In conclusion, understanding consumer behaviour is essential for product marketing managers in the beauty industry. By understanding the demographics and psychographics of their target audience, brands can create more effective marketing strategies and better tailor their products to meet the needs of their customers.

Additionally, by understanding consumer behaviour models, purchase decision factors, and consumer segmentation, companies can better target their audience and create more effective marketing campaigns.

Lastly, by staying up-to-date on current trends in the beauty industry and analyzing successful case studies, brands can adapt their strategies to meet the changing needs and preferences of the market.

Key Takeaways:

  • Understand the demographics and psychographics of your target audience
  • Use consumer behaviour models to understand your audience better
  • Identify key purchase decision factors that influence consumer behaviour in the beauty industry
  • Use consumer segmentation to target your audience better
  • Stay up-to-date on current trends in the beauty industry
  • Analyze successful case studies to adapt your marketing strategies and product offerings.

Want to learn more about the latest beauty, cosmetics, and personal care trends? Download our report About Face here

beauty-trends-report
Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

The year is 2033, and the field of medicine has changed significantly. Wearable med-tech devices are everywhere, providing real-time monitoring of patient health and enabling healthcare providers to detect potential issues before they become serious. Innovative technologies such as artificial intelligence and robotics are used to improve diagnosis, treatment, and patient outcomes. Welcome to the future of med-tech.

According to a recent report, the global medical technology market is expected to grow at a compound annual growth rate of 5.6% from 2021 to 2028, driven by the increasing prevalence of chronic diseases, technological advancements, and rising healthcare expenditures. As the med-tech industry continues to evolve, so do the challenges and opportunities for growth.

The Current State of the Med-Tech Industry

The med-tech industry has been undergoing a rapid transformation over the last few years, driven by technological advancements, changing patient needs, and increasing healthcare expenditures. 

One of the major trends in the med-tech industry is the increasing adoption of digital health solutions. With the rise of smartphones, wearables, and other connected devices, patients are more engaged in their health than ever before. This has created a growing demand for digital health solutions that allow patients to monitor their health, track their progress, and communicate with their healthcare providers.

Another trend in the med-tech industry is the increasing focus on patient outcomes. As healthcare shifts from a volume-based to a value-based model, providers increasingly seek solutions that can improve patient outcomes and reduce costs. This has created a growing demand for technologies that can improve diagnosis, enhance treatment options, and streamline operations.

Despite the many opportunities in the med-tech industry, there are also significant challenges that need addressing. One of the biggest challenges is regulatory compliance. Med-tech companies must comply with complex regulations, including the FDA’s Quality System Regulation and the European Medical Devices Regulation. This can make it difficult for companies to bring innovative products to market quickly and cost-effectively.

Another challenge in the med-tech industry is cybersecurity. With the increasing use of connected devices and digital health solutions, there is a growing risk of cyberattacks that can compromise patient data and disrupt operations. This has created a need for med-tech companies to invest in cybersecurity solutions that can protect their systems and data.

Despite these challenges, the med-tech industry is poised for continued growth in the years ahead. According to a report by Grand View Research, the global medical device market will reach $612.7 billion by 2025, driven by factors such as increasing healthcare expenditures, aging populations, and the growing prevalence of chronic diseases.

Med-tech Timeline

The term “med-tech” is believed to have been coined in the late 1990s, around the time when the med-tech industry was undergoing rapid transformation due to the rise of digital health solutions and other technological advancements. However, the roots of the med-tech industry can be traced back centuries, with the development of various medical devices and technologies that have revolutionised healthcare over the years.

  • 1895: The X-ray is invented, revolutionising medical imaging and diagnosis.
  • 1928: The discovery of penicillin marks the beginning of the antibiotic era.
  • 1952: The first artificial heart valve is developed.
  • 1960: The development of implantable pacemakers leads to significant advances in the treatment of cardiac arrhythmias.
  • 1979: The first MRI machine is developed, providing non-invasive imaging of the body’s soft tissues.
  • 1980s: The development of laparoscopic surgery allows for minimally invasive surgery, reducing patient recovery times and complications.
  • 1998: The first wearable defibrillator is approved by the FDA for use outside of hospitals.
  • 2001: The first continuous glucose monitor is introduced for at-home monitoring of blood sugar levels in patients with diabetes.
  • 2004: The first remote patient monitoring systems were introduced, allowing patients to be monitored at home.
  • 2006: The first wireless fetal monitor is introduced, allowing expectant mothers to monitor their baby’s heartbeat at home.
  • 2010: The rise of digital health solutions and mobile health technologies leads to a new era of patient engagement and personalised healthcare. Wearable fitness trackers and smartwatches have gained popularity, allowing users to track their fitness and monitor their health data, including heart rate and sleep patterns.
  • 2014: The first at-home genetic testing kits are introduced, allowing consumers to analyze their DNA for ancestry and health information.
  • 2016: The FDA approves the first at-home artificial pancreas system for patients with type 1 diabetes, allowing for automated insulin delivery.
  • 2017: The FDA approves the first digital pill, which contains a sensor that can track when the medication is ingested.
  • 2020: During the COVID-19 pandemic, telemedicine and remote patient monitoring technologies increase dramatically, as patients seek to avoid in-person visits to healthcare providers.

The Role of Technology in Driving Growth

In recent years, technology has played a significant role in driving growth in the med-tech industry. From artificial intelligence (AI) to the internet of things (IoT), a wide range of innovative technologies are transforming the way healthcare is delivered. 

One of the most promising technologies driving growth in the med-tech industry is artificial intelligence (AI). With its ability to analyze vast amounts of data and identify patterns, AI is well-suited for a range of applications in healthcare. For example, AI-powered diagnostic tools can help healthcare providers to more accurately diagnose and treat a range of conditions, while AI-powered predictive analytics can help identify patients who are at risk of developing certain conditions before symptoms appear. AI is also being used to develop more personalised patient treatment plans based on their unique genetic and environmental factors.

Another technology driving growth in the med-tech industry is the internet of things (IoT). With the proliferation of connected devices, there is a growing opportunity to leverage the IoT to improve patient outcomes and reduce costs. For example, IoT-enabled medical devices can monitor patient health in real-time and alert healthcare providers if there are any concerning changes. This can help to prevent hospital readmissions and other costly complications. The IoT is also being used to optimise hospital operations by using real-time data to manage patient flow, reduce wait times, and improve patient satisfaction.

Other innovative technologies driving growth in the med-tech industry include machine learning, blockchain, and virtual reality. Machine learning, like AI, analyzes large data sets and improves healthcare outcomes. Meanwhile, blockchain is used to create more secure and efficient healthcare data exchanges, while virtual reality trains healthcare providers and provides patients with immersive therapy experiences.

As the med-tech industry continues to evolve, we will likely see even more exciting developments in the years ahead.

Examples of Innovative Med-tech products

Medtronic’s Micra Transcatheter Pacing System

This tiny pacemaker implanted directly into the heart eliminates the need for leads or a surgical pocket under the skin. The device is only 1/10th the size of a traditional pacemaker and has a battery life of up to 14 years. The Micra system has been shown to have a lower risk of complications compared to traditional pacemakers and has been used to treat over 100,000 patients worldwide.

Philips’ Lumify Ultrasound System

This portable ultrasound system can be used with a smartphone or tablet. The small and lightweight device makes it easy to transport to remote or rural areas. The Lumify system provides ultrasound imaging in emergency rooms, critical care units, and in the field during disaster response efforts.

Prosthetics by Open Bionics

This is a UK-based company that develops prosthetic limbs using 3D printing technology. Open Bionics’ prosthetics are lightweight, affordable, and can be customised to fit each individual patient. The company has developed a range of prosthetic limbs for adults and children, including arms and hands, and has received several awards for its innovative products.

Best Practices for Leveraging Innovative Technology

Leveraging innovative technology is essential for driving growth in the med-tech industry. However, it’s important to approach the selection and implementation of technology solutions strategically to ensure they are effective and aligned with business objectives. 

The first step in leveraging innovative technology is to assess the needs of your target audience. This requires a deep understanding of the challenges faced by healthcare providers and patients and the opportunities for improving patient outcomes and reducing costs. For example, suppose you are developing an AI-powered diagnostic tool. In that case, it’s essential to understand the specific diagnostic challenges healthcare providers face and ensure the device is user-friendly and easy to integrate into existing workflows.

Another important consideration is identifying key performance indicators (KPIs) for measuring the success of technology solutions. This requires a clear understanding of the business objectives that are driving the adoption of technology. For example, if your objective is to reduce hospital readmissions, your KPIs might include the number of readmissions per month or the average length of patient stay.

Building a solid technology infrastructure is also critical for leveraging innovative technology. This requires investing in the right hardware and software and developing a robust data management system that can support the collection, analysis, and storage of large amounts of data. It’s also important to have a team of experienced technology professionals who can manage the implementation and maintenance of technology solutions.

To ensure the effective implementation of innovative technology, it’s important to have a strong focus on user adoption. This requires engaging with healthcare providers and patients to understand their needs and preferences and designing technology solutions that are intuitive and user-friendly. This approach has been shown to be effective in increasing adoption rates and improving outcomes. For example, a study published in the Journal of the American Medical Association found that an AI-powered diagnostic tool was more effective when healthcare providers were engaged in the development process and provided with training and support.

Case Studies from Around the World

Innovative technology is transforming the med-tech industry worldwide, with companies using advanced solutions to improve patient outcomes, streamline operations, and drive revenue growth. In this section, we will showcase some case studies from around the world that illustrate how innovative technology is driving growth in the med-tech industry.

United Kingdom

Sensyne Health is a UK-based healthcare company founded in 2018 by Lord Paul Drayson. The company uses artificial intelligence (AI) to develop innovative healthcare solutions that improve patient outcomes and reduce costs. Sensyne’s clinical AI technology is used to create predictive algorithms to help healthcare providers identify patients at risk of developing certain conditions. By analyzing patient data in real-time, Sensyne’s technology can help clinicians to identify patients who may benefit from early intervention, ultimately leading to better health outcomes and reduced costs.

Sensyne has partnered with several UK-based hospitals and research organisations to develop and test its solutions. One notable partnership is with the University of Oxford’s Big Data Institute. Sensyne is working with researchers to create predictive models for conditions such as heart failure and sepsis. Using AI to analyze large datasets, Sensyne, and its partners can develop highly accurate predictive models to help clinicians make better decisions and improve patient outcomes.

In addition to its partnerships, Sensyne has also reported impressive financial results. In 2020, the company reported a 43% increase in revenue, driven by strong demand for its technology solutions. Sensyne has also secured several large contracts with UK-based healthcare providers, including a partnership with Chelsea and Westminster Hospital NHS Foundation Trust to develop a digital early warning system for patients with COVID-19. 

By developing predictive algorithms and using AI to analyze patient data, Sensyne is helping improve patient outcomes and reduce costs, securing impressive financial results, and establishing partnerships with leading healthcare providers and research organisations.

Europe

Ada Health is a Berlin-based company that has developed a mobile app that uses AI to help patients diagnose their symptoms. The app asks users questions to determine the possible causes of their symptoms and provides personalised health recommendations. Ada Health partners with several European health systems, including the UK’s National Health Service (NHS). It is helping to reduce the burden on healthcare providers by empowering patients to take a more active role in their healthcare.

USA

Atrius Health is a US-based healthcare organisation that is at the forefront of using virtual care technology to improve patient outcomes and reduce costs. The organisation was founded in 2004 and is headquartered in Newton, Massachusetts. Atrius Health provides a wide range of healthcare services to patients in the New England area, including primary care, speciality care, and behavioural health services.

By leveraging virtual care technology, Atrius Health can connect patients with healthcare providers remotely, reducing the need for in-person visits and improving patient access to care. In recent years, the organisation has reported significant improvements in patient satisfaction, clinical outcomes, and cost savings.

One example of Atrius Health’s success is its implementation of virtual group visits, which allow patients with similar conditions to receive care together remotely. By connecting patients with each other and with healthcare providers, virtual group visits have been shown to improve patient engagement and satisfaction while also reducing the need for in-person visits and improving health outcomes. According to Atrius Health, patients who participated in virtual group visits for diabetes management had a 5.9% reduction in HbA1c levels, compared to a 2.4% reduction for patients who received usual care.

Atrius Health has also reported significant cost savings due to its virtual care initiatives. According to a recent report, the organisation saved more than $15 million in 2019 using virtual care technology. In addition to cost savings, virtual care has allowed Atrius Health to expand its reach and provide care to patients in rural and underserved areas.

By implementing innovative solutions like virtual group visits and focusing on patient engagement, Atrius Health has established itself as a leader in the med-tech industry, with a strong track record of success and a commitment to improving patient outcomes.

India

Practo is an Indian healthcare company that has developed a mobile app that allows patients to book appointments with healthcare providers, access their medical records, and communicate with their healthcare team. The app allows patients to save time and improve their access to care. Practo has also developed a telemedicine solution that enables patients to consult with healthcare providers remotely, improving access to care for patients in rural areas.

Japan

Sony is a Japanese electronics company expanding its presence in the med-tech industry. One of Sony’s recent developments is a wearable device that can monitor vital signs, such as heart rate and blood pressure. The device uses advanced sensor technology to provide real-time patient health monitoring, allowing healthcare providers to detect potential issues before they become serious.

In 2018, Sony announced the release of its wearable device, the Wena Wrist Pro. The device has sensors that can detect heart rate, blood pressure, and other vital signs. It also has an NFC chip, allowing users to make payments and access public transportation. The device can connect to a smartphone app, allowing users to monitor their health data and share it with healthcare providers.

The Wena Wrist Pro has been used in several hospitals in Japan to improve patient outcomes and reduce costs. For example, in 2019, Sony partnered with Osaka University Hospital to conduct a pilot study using the Wena Wrist Pro to monitor patients with congestive heart failure. The study found that the device was effective in detecting changes in patient health, allowing healthcare providers to intervene before serious complications occurred.

Toshimoto Mitomo, Deputy Senior General Manager of Sony’s AI Robotics Business Group, says, “We see healthcare as a very important business domain for Sony. We are committed to developing technology that can help people lead healthier, more fulfilling lives.” In addition to the Wena Wrist Pro, Sony is also developing other healthcare technologies, such as a biometric sensor that can measure stress levels and a robotic pet that can provide companionship for elderly people.

Overall, Sony’s development of the Wena Wrist Pro is an example of how wearable technology can be used to improve patient outcomes and reduce costs in the med-tech industry. With its advanced sensor technology and smartphone connectivity, the Wena Wrist Pro has the potential to revolutionise the way patients and healthcare providers monitor and manage health.

China Ping An Good Doctor is a Chinese healthcare company that has developed a telemedicine platform that connects patients with healthcare providers remotely. The platform uses AI to provide diagnosis and treatment recommendations and has been used by millions of patients across China and Southeast Asia. The company has reported significant growth in recent years, driven by increasing demand for telemedicine solutions in the region.

Singapore 

Holmusk is a Singapore-based healthcare company at the forefront of using innovative technology to improve mental health services. The company was founded in 2015 by Nawal Roy and has since established itself as a leader in the med-tech industry, focusing on using AI to provide personalised therapy for patients.

Holmusk’s mental health platform, “Big White Wall,” uses AI to analyze patient data and provide customised treatment plans. The platform can identify potential risk factors for mental health issues, such as depression and anxiety, and provide early intervention to prevent serious complications. The platform also includes a community feature, allowing patients to connect and share experiences.

Holmusk has partnered with several healthcare providers in Singapore to improve access to mental health services. One notable partnership is with National University Hospital (NUH), where Holmusk provides its mental health platform to patients with chronic illnesses. According to NUH, the partnership has resulted in a 30% reduction in hospital admissions and a 60% reduction in emergency department visits among patients with chronic illnesses.

In addition to its partnerships in Singapore, Holmusk has expanded to other countries in the region, such as Malaysia, Indonesia, and the Philippines. The company reported impressive growth in recent years, with a 50% increase in revenue in 2020 and a valuation of over $100 million.

According to Nawal Roy, Founder and CEO of Holmusk, “Our mission is to improve mental health outcomes for millions of people around the world. By using AI to provide personalised therapy, we are helping to address the global mental health crisis and improve access to care for those who need it most.”

Canada 

MindBeacon is a Canadian mental health company that has developed an online platform that provides personalised therapy for patients with mild to moderate mental health concerns. The platform uses AI to match patients with licensed therapists and provides access to interactive exercises and guided meditations. MindBeacon has partnered with several Canadian employers and health plans to improve employee access to mental health services.

Thailand

OmiseGO is a Thai fintech company that has developed a blockchain-based payment system for healthcare transactions. The platform allows healthcare providers to securely and efficiently manage payment and insurance transactions, reducing administrative burdens and improving patient experiences. OmiseGO has partnered with several Thai health systems to implement its payment system.

Indonesia

Halodoc is an Indonesian healthcare company that has developed a mobile app allowing patients to consult remotely with healthcare providers. The app provides access to various healthcare services, including telemedicine, pharmacy delivery, and lab tests. Halodoc has partnered with several Indonesian health systems to improve access to care for patients in remote areas.

Vietnam

eDoctor is a Vietnamese healthcare company that has developed a telemedicine platform allowing patients to consult remotely with healthcare providers. The platform provides access to various healthcare services, including online consultations, prescription delivery, and lab tests. eDoctor has partnered with several Vietnamese health systems to improve access to care for patients in remote areas.

Philippines

HealthNow is a Philippine healthcare company that has developed a telemedicine platform that connects patients with healthcare providers remotely. The platform provides access to various healthcare services, including virtual consultations, e-prescriptions, and lab tests. HealthNow has partnered with several Philippine health systems to improve access to care for patients across the country.

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

What does the future hold for med-tech?

Futurists predict that technological innovations will significantly impact the med-tech industry in the next decade, with several advancements expected to transform the way healthcare is delivered. Here are a few predictions:

  • Increased Use of Artificial Intelligence (AI): AI will play an increasingly important role in healthcare in the next decade, with the potential to improve diagnosis, treatment, and patient outcomes. AI-powered tools can analyze large amounts of data quickly and accurately, allowing healthcare providers to make more informed decisions.
  • More Personalised Medicine: Advances in genomics, wearables, and other technologies are expected to enable more personalised medicine. Healthcare providers can tailor treatments to each individual’s unique needs by analyzing a patient’s genetic makeup and other factors.
  • Greater Use of Robotics: Robotics will play an increasingly important role in healthcare, with the potential to improve surgical outcomes, assist with rehabilitation, and provide remote care. While robots are unlikely to replace doctors entirely, they will assist with certain tasks, such as surgery, and provide support for patients in areas such as physical therapy.
  • Telemedicine and Remote Care: The COVID-19 pandemic has accelerated the trend toward telemedicine and remote care, which will continue to grow and evolve. Telemedicine and remote care enable patients to access healthcare services from anywhere, reducing the need for in-person visits and improving access to care, especially in rural or underserved areas.

The med-tech industry is undergoing a period of rapid transformation driven by the power of innovative technology. From AI and machine learning to wearables and telemedicine, technology solutions are improving patient outcomes, streamlining operations, and driving revenue growth. 

As the med-tech industry evolves, companies must stay up-to-date with the latest trends and best practices. By assessing the needs of their target audience, identifying key performance indicators, building a solid technology infrastructure, and focusing on user adoption, brands in the med-tech space can position themselves for success in the years ahead.

Want more insight into the world of med-tech? Download our comprehensive trend report “Feeling Good: Powering the Next Gen of Fitness and MedTech” here.

According to a report by MarketsandMarkets, the wearable technology market is expected to reach $54 billion by 2023. Understanding consumer behaviour related to wearable technology is more important than ever. Analyzing consumer behaviour can provide valuable insights for product marketing managers and research executives, enabling them to design products that meet different consumer segments’ needs and preferences and develop effective marketing and pricing strategies. 

This blog will examine the various facets of consumer behaviour related to wearable technology, including purchasing habits, usage patterns, and perceptions of the technology. Through this analysis, we can better understand the needs and preferences of different consumer segments and how companies can cater to these needs to stay competitive in this growing industry.

Wearable technology refers to electronic devices worn on the body, typically as accessories or clothing items. These devices are designed to track or collect data related to the wearer’s health, fitness, and daily activities, among other things. Examples of wearable technology products include smartwatches, fitness trackers, and augmented reality glasses.

The benefits of wearable technology from a consumer perspective are numerous. Wearable devices can help individuals track their fitness goals, monitor their health metrics, and stay connected to their digital lives on the go. A recent study by Grand View Research estimated that the global wearable technology market size is expected to reach $104.39 billion by 2027, with the health and fitness segment being the largest market.

However, there are also drawbacks to wearable technology that should be considered. One concern is the potential invasion of privacy, as these devices collect and transmit data about the wearer’s personal life. Another drawback is the potential for distraction and over-reliance on technology, as wearers may become too focused on their devices instead of their surroundings.

As wearable technology continues to evolve, so do its benefits and drawbacks. The late fashion designer Karl Lagerfeld once said, “Technology has to be invisible. Wearable technology must be beautiful.” This sentiment reflects the desire of consumers for devices that not only function well but also look good and feel comfortable to wear.

Despite the potential drawbacks, wearable technology is poised to continue its growth in popularity as more consumers seek to integrate technology into their daily lives. As the benefits of these devices become more widely recognised and as technology continues to advance, wearable technology is likely to play an increasingly important role in the future of consumer technology.

Wearable Technology Timeline

  • 1975: The first wearable computer, the “Wearable Computer for Computerised Conference Control,” is created by Edward Thorp and Claude Shannon.
  • 1994: Seiko releases the first smartwatch, called the Seiko MessageWatch.
  • 1999: The first Bluetooth headset, developed by Ericsson, is released.
  • 2008: Fitbit releases its first fitness tracker, the Fitbit Classic.
  • 2010: The first generation of the Apple Watch is released, marking Apple’s entry into the wearable technology market.
  • 2012: Google releases Google Glass, a pair of smart glasses that use augmented reality technology.
  • 2014: The first Android Wear smartwatches, including the LG G Watch and the Samsung Gear Live, are released.
  • 2015: The Apple Watch Series 1 is released, which includes features such as heart rate monitoring and fitness tracking.
  • 2016: Pokemon Go, an augmented reality mobile game, becomes a worldwide sensation and brings attention to the potential of augmented reality technology in wearable devices.
  • 2017: Fitbit acquires Pebble, a popular smartwatch brand.
  • 2018: Apple releases the Apple Watch Series 4, which includes advanced health features such as an ECG monitor and fall detection.
  • 2019: The global wearable technology market is valued at $32.63 billion, according to a report by Grand View Research.
  • 2020: The COVID-19 pandemic increases demand for wearable technology that can monitor health metrics, such as temperature and oxygen levels.
  • 2021: Wearable devices continue to gain popularity, with features such as sleep tracking, stress monitoring, and more advanced fitness tracking capabilities.

Wearable Tech Consumer Purchasing Habits 

Consumer purchasing habits play a crucial role in the wearable technology industry, directly influencing product design, marketing, and pricing strategies. 

Here are some of the main factors that influence consumers’ decisions to purchase wearable technology:

  • Health and Fitness Goals: Consumers who prioritise health and fitness are more likely to purchase wearable technology devices, such as fitness trackers and smartwatches, that can help them monitor their activity levels, sleep patterns, and overall health metrics. According to a 2021 survey by Statista, 53% of wearable technology users in the United States use their devices to track fitness and health.
  • Fashion and Style: Wearable technology designed to be stylish and aesthetically pleasing can appeal to fashion-conscious consumers. For example, luxury watch brands such as TAG Heuer and Fossil have introduced smartwatches that combine fashion and technology to cater to this market.
  • Compatibility with Other Devices: Consumers who already own other devices, such as smartphones or laptops, may be more likely to purchase wearable technology compatible with their existing technology. This can include devices that use the same operating system, such as Apple’s ecosystem of products, or devices that integrate with popular apps and services.
  • Price: The cost of wearable technology devices is important for many consumers. According to a 2021 report by PwC, price was the most important consideration for 60% of respondents considering purchasing a wearable device.

Consumer purchasing habits also vary depending on the demographic and psychographic characteristics of different consumer segments. For example, younger consumers may be more likely to purchase wearable technology as they are more likely to be early adopters of new technology. Similarly, consumers with higher incomes may be more likely to buy luxury wearable devices, while consumers who prioritise environmental sustainability may be more likely to purchase eco-friendly wearable technology.

According to a 2020 report by IDC, the top five wearable technology vendors in market share are Apple, Xiaomi, Samsung, Huawei, and Fitbit. These companies cater to different market segments and offer a range of products at different price points. For example, Apple’s high-end smartwatches and earbuds appeal to consumers who prioritise technology and style, while Fitbit’s fitness trackers cater to consumers who prioritise health and fitness.

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

Wearable Technology Usage Patterns

Wearable technology has a wide range of applications and features that make it appealing to consumers. Here are some of the ways that consumers use wearable technology and the features and functionalities that are most important to them:

  • Fitness Tracking: Wearable technology is popular for fitness tracking, with features like step tracking, heart rate monitoring, and calorie tracking. According to a 2021 survey by Statista, 57% of wearable technology users in the United States use their devices for fitness and exercise.
  • Health Monitoring: Wearable technology can also be used for health monitoring, with features like blood pressure monitoring, sleep tracking, and medication reminders. This is especially important for ageing populations or individuals with chronic health conditions.
  • Communication and Connectivity: Wearable technology can be used for communication and connectivity, with features like phone calls, messaging, and social media integration. This is particularly useful for busy professionals or individuals always on the go.
  • Entertainment and Gaming: Wearable technology can be used for entertainment and gaming, with features like music streaming, video playback, and augmented reality games. This is popular among younger consumers who prioritise entertainment and technology.
  • Workplace Applications: Wearable technology can be used in workplace applications, such as industrial settings where workers need to be hands-free or in retail environments where workers need to access inventory and customer data quickly.

The features and functionalities that are most important to consumers vary depending on the device’s intended use. For fitness trackers and smartwatches, consumers prioritise features such as battery life, accuracy, and ease of use. For workplace wearables, consumers prioritise durability, connectivity, and compatibility with existing systems.

Usage patterns also vary among different consumer segments. For example, according to a 2021 survey by YouGov, men are more likely than women to use wearable technology for fitness and exercise purposes, while women are more likely to use wearables for health monitoring. Similarly, younger consumers are more likely to use wearable technology for entertainment and gaming, while older consumers prioritise health and fitness tracking.

Brands that have successfully tapped into different usage patterns and consumer segments include Fitbit, Apple, and Samsung. Fitbit’s range of fitness trackers and smartwatches cater to consumers who prioritise health and fitness, while Apple’s high-end smartwatches appeal to consumers who prioritise technology and style. Samsung offers a range of smartwatches with features such as cellular connectivity and long battery life, which appeal to consumers who prioritise connectivity and convenience.

Overall, wearable technology is a versatile and multi-functional technology that appeals to a wide range of consumers. Understanding the different usage patterns and preferences of different consumer segments will be critical for companies in this industry to continue innovating and meeting the evolving needs of consumers.

Perceptions of Wearable Technology

Consumer perceptions of wearable technology play a significant role in the success of these devices in the market. Here are some of the attitudes and beliefs that consumers may have about wearable technology:

  • Convenience: Many consumers perceive wearable technology as convenient, allowing them to access information and stay connected without pulling out their smartphones.
  • Health and Fitness Benefits: Consumers who prioritise health and fitness perceive wearable technology as a tool for improving their overall health and fitness goals by tracking their activity levels, sleep patterns, and other health metrics.
  • Fashion and Style: Consumers who prioritise fashion and style may perceive wearable technology as an accessory that complements their personal style and reflects their personality.
  • Privacy and Security Concerns: Some consumers are concerned about wearable technology’s privacy and security implications, as these devices can collect and transmit sensitive data about the wearer’s personal life.
  • Stigma and Social Acceptance: Some consumers may perceive wearable technology as stigmatised or socially unacceptable, especially if the devices are bulky, unattractive, or otherwise conspicuous.
  • Limited Battery Life: Many wearable devices have limited battery life, which can be a source of frustration for consumers who need to use them throughout the day.

Factors influencing consumers’ perceptions of wearable technology include product design, marketing messaging, and media coverage. For example, Apple’s sleek and stylish smartwatches have helped to rebrand wearable technology as a fashion accessory. In contrast, Fitbit’s focus on health and fitness has helped to position wearable technology as a tool for self-improvement.

In terms of concerns and misconceptions, wearable technology companies have worked to address issues such as privacy and security by implementing data encryption and user consent measures. For example, Fitbit’s privacy policy states that user data is encrypted and anonymous and that users can choose whether or not to share their data with third-party apps and services.

Media coverage and public perception also play a role in shaping consumer attitudes toward wearable technology. For example, the Google Glass project was ultimately discontinued in 2015 due to negative media coverage and privacy concerns. However, other products, such as smartwatches and fitness trackers, have continued to gain popularity as consumers become more comfortable with the technology and its benefits.

Overall, understanding consumer attitudes and perceptions towards wearable technology is crucial for companies in this industry to design products that meet consumers’ needs and preferences and address concerns and misconceptions that may impact adoption rates. As wearable technology continues to evolve and become more integrated into daily life, consumer perceptions and attitudes will be key factors in its success.

Understanding consumer behaviour related to wearable technology can provide valuable insights for product marketing managers and marketing executives. Here are some recommendations and implications for these professionals based on the analysis of consumer behaviour:

  • Design products that meet the needs and preferences of different consumer segments: Consumer behaviour analysis can help brands identify the segments of consumers likely to purchase wearable technology, as well as the features and functionalities that are most important to them. This information can be used to design products that meet these segments’ specific needs and preferences.
  • Address privacy and security concerns: Privacy and security concerns are among consumers’ top concerns about wearable technology. Brands should address these concerns, such as implementing data encryption and user consent measures and communicating these measures clearly to consumers.
  • Emphasise the benefits of wearable technology: Consumers are more likely to purchase when they understand its benefits. Brands should emphasise the convenience, health, and fitness benefits, and other features that make wearable technology a valuable addition to consumers’ lives.
  • Innovate with new features and functionality: As wearable technology continues to evolve, brands should look for new features and functionality that can enhance the value and appeal of these devices. For example, advances in biometric technology and augmented reality has the potential to open up new possibilities for wearable technology.
  • Use pricing strategies that cater to different consumer segments: Consumer behaviour analysis can also help product marketing managers and executives to identify the different pricing strategies that are most effective for different consumer segments. For example, luxury smartwatch brands may be able to charge higher prices for their products, while budget fitness tracker brands may need to compete on price to attract price-sensitive consumers.

According to a report by MarketsandMarkets, the wearable technology market is expected to grow at a CAGR of 15.5% from 2021 to 2026, highlighting the importance of developing effective strategies to stay competitive in this growing industry. By considering these recommendations, companies can develop effective product design, marketing, and pricing strategies that cater to the needs and preferences of different consumer segments. 

As technology continues to evolve, so will the world of wearable technology. As Steve Mann, a pioneer in wearable computing, once said: “Wearable computing is the next stage in the digital revolution. Combining technology with fashion can make our devices more personalised and integrated into our lives.”

Understanding consumer behaviour towards wearable technology is crucial for brands to design products that meet the needs and preferences of different consumer segments and to develop effective marketing and pricing strategies. 

As the wearable technology market continues to grow, companies in this industry will need to stay vigilant and continue to innovate to meet the evolving needs of consumers.

By analyzing consumer behaviour, addressing concerns and misconceptions, and emphasising the benefits of wearable technology, companies can position themselves for success in this dynamic and rapidly-growing industry. As wearable technology becomes more integrated into daily life, the potential for innovation and growth in this field is limitless.

Learn more about the wearable technology industry in our comprehensive trend report Feeling Good: Powering the Next Gen of Fitness and Medtech. Download here.

If you want a crocheted sweater or a bespoke engraved cutting board but need help finding an artisan, you might turn to platforms like Etsy that connect buyers with artisans on their eCommerce platforms. 

The last decade has brought a massive consumer shift in mindset. Consumers today care about where their products come from, who produced them, and under what conditions they were made. They care about the impact of everything they purchase —on the workers and the environment. 

Many trends are responsible for the maturation of the artisan economy around the globe, such as the rise of e-commerce, a growing interest in the environment and sustainability, the demand for rare, unique, personalised items, and a desire to support the local economy and small businesses. 

Consumers care about sustainability, ethical consumption, and small-batch production and are looking for unique pieces with a story to add to their lives. 

There has been a massive demand for handmade products globally. Handmade or artisanal products are high quality and unique, making them desirable for people looking for one-of-a-kind products with a strong narrative. 

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

The need for personalization and the recent movements supporting local businesses and artisans have also helped promote bespoke brands or handmade products.

Unlike mass-produced goods, handmade products have certain deviations, and no two products will be the same, adding to the uniqueness consumers seek in the products they purchase.

When consumers purchase a handmade product, they are also buying into the story and history behind it and building a deep connection with the artisan making the product while supporting craftsmanship and local businesses. Consumers are avoiding off-the-shelf pieces, and artisan goods are becoming a staple. 

According to a U.K. Crafts Council report, 73 percent of U.K. adults had bought a craft in 2019 —which amounts to almost 25 million handmade items. About 32 percent of today’s buyers are under 35 years of age, making the younger populations of Millennials and Gen Z the biggest craft shoppers today. There are 11,620 craft businesses in the U.K., with over 43,000 employees. 

Consumers often save crafts and techniques that face extinction and erasure by purchasing artisanal goods. And now, many big brands want to add a piece of the traditional method to their products. For instance, independent watchmaker Daizoh Makihara decided to use the traditional Japanese glass-cutting technique called Edo-kiriko for the dial of his first watch. He found eight companies that specialised in the method, but only one agreed to do it. This was Kyosuke Hayashi, the president of Mitsuwa Glass Kogei. 

In English, Edo-kiriko means “cut glass from Edo”: Edo is an old name for Tokyo, and kiriko is the name of the cutting technique. This partnership gave birth to the first edo-kiriko watch in the world in 2018. 

The weavers and artisans work hard to keep the rich Indian arts and crafts heritage alive. According to IBEF, the total handicraft exports from India reached $3.5 billion in FY20. With over 200 million artisans, India’s handicraft sector is the second largest employer after agriculture. 

While fast fashion is pressuring the environment with its heavy carbon emissions, water waste, and poor working conditions and treatment of workers, consumers are hungry for a better model that offers trendy essentials and accessories without harmful environmental and socio-economic impact.

eCommerce has enabled many skilled artisans and hobbyists to profit from their passion and talent. 

Consumer obsession and interest in handmade products have also seeped into reality T.V., and craft reality T.V. shows have become quite the rage. 

British reality show Handmade: Britain’s Best Woodworker is a furniture-making competition similar to a cooking contest that has captured the hearts of audiences worldwide. Every major network and various streaming platforms are in on the trend. Other similar shows include BBC’s All that Glitters, Netflix’s Blown Away, NBC’s Making It, HBO Max’s Craftopia, ITV’s Bling, and Channel 4’s The Great Pottery Throwdown.  

The pandemic spurred the demand for handmade goods. Online platforms have fuelled much of this growth: in December 2018, Etsy, a U.S.-based online platform for artisans to buy and sell handmade goods, reported that there were 220,000 active sellers in the U.K. with a further 9,000 makers on Folksy, a U.K.-based online platform to purchase handcrafted gifts and original artwork, sold directly by the artists and designers who have created them.

Top handmade product categories on Etsy 

According to a report, the top handmade product category on Etsy in 2020 was home and living, with a 25 percent seller share, followed by art and collectables (21 percent), jewellery (15 percent), clothing (11 percent), accessories (8 percent), bath and beauty (6 percent), toys and games (4 percent), bags and purses (3 percent), weddings (2 percent), and books, movies and music (2 percent).

Etsy has three main sections in its online marketplace: Handmade, Vintage, and Supplies. Handmade represents 85 percent of sellers, Vintage represents 6 percent, and Supplies represent 12 percent of sellers.

Etsy, founded in 2005, now has more than 1.4 million sellers and 19.8 million buyers. Etsy focuses on handmade and vintage items and features over 5.4 million craft supply items.

Handmade gifts provide a personal touch and make the gift unique and personalised. This unique factor has driven platforms and brands that offer handmade products as popular choices during the Holidays. 

There has been an 80 percent jump in searches on the creator-driven platform Etsy for Holiday gifts in the past three months compared to last year. In 2020, CNBC reported that Etsy saw a 156 percent increase in search traffic during three months compared to the year prior for custom gifts.

Case Study: How Etsy carved a niche for the handmade sector using an e-commerce platform

The Overview

Based in Brooklyn, New York, Etsy is the largest online marketplace globally, connecting buyers to sellers of handmade and vintage goods and craft supplies. Etsy is built on a smart revenue model: it charges sellers a listing fee and a commission and upsells advertising services to push a seller’s products to boost reach. The company expanded through acquisitions, including Blackbird Tech for USD 32.5 million, Reverb in 2019 for USD 275 million, and the fashion resell marketplace, Depop in 2021 for USD 1.63 billion.

The company has competitors like Amazon Handmade, Big Cartel, Folksy, iCraft, and eBay. 

The Approach

Etsy took the value creation approach and narrowed its product offering to handmade or artisan-made products. While it has created a community of buyers and sellers, it moved its focus to buyers as the core market when eBay vet Josh Silverman took over Etsy’s reins. A year after hitting an all-time low in 2017, Etsy’s stock rebounded and grew; today, it stands at USD 119.74 a share. Defining and focusing on its key audience helped the brand grow. 

Once the brand identified its core audience, the buyers, it hiked the fees it charged its sellers from 5 percent to 6.5 percent. Even though 20,000 of its sellers went on strike, the company did not budge, and the results showed in the most recent third-quarter earnings in 2022, reporting a revenue bump of 11.7 percent over the same quarter of 2021, to USD 594.5 million. 

Etsy is also attracting more buyers to its platform via the mobile app. In 2021 alone, the brand reported a 45 percent increase in app downloads bringing 5.7 million new shoppers to download the app. The brand also leverages targeted, compelling email offers based on items favourited or shops browsed. The brand funded discounts and sent them to 18 million shoppers in 2021, and also provided discount technology allowing shoppers to discount goods from their shops. The brand also encourages buyers to follow more shops through sweepstakes and contests. 

The brand also offers multiple additional services to facilitate communication with sellers, on-platform transactions, and access to ratings and reviews. 

Etsy allows its sellers to voice their concerns with congress members and local and federal governments. And lastly, the brand continuously invests in retail technologies like machine learning via acquisitions. The brand has designed convenient distribution channels, upgraded buying and selling software and merchant services, and improved its social media presence to boost brand awareness. This month, Etsy rolled out a new image search feature to allow shoppers to find an object faster than with a keyword search. Users on iOS can now tap the camera icon and search for images by uploading a picture. Etsy then scours its platform to find products visually similar to the ones the user is searching for. Etsy plans to expand image search to Android app users soon.

The Results

Etsy’s impact on the artisan economy is robust. The most recent quarterly earnings report disclosed revenues had risen to USD 198 million, a 31.64 percent increase year over year. Etsy currently holds a market cap of just under USD 5.5 billion – quite a climb from its USD 1.1 billion market cap back in March 2017. The brand attracted 6.3 million shoppers in the third quarter of 2022, ending with 88.3 million active buyers on the Etsy marketplace.

In most developing nations, the handicraft industry is fragmented, lacking legal Intellectual Property laws surrounding its products, and artisans not getting fair compensation for their craft. 

In most countries, handcrafts are highly valued because of the high skill level and talent required and are sold in luxury stores at premium prices. However, although India has a rich culture and many categories of handicrafts, they still need to be given their deserved value and place. Ramesh Menon founded Save the Loom, a nonprofit community group to revive, restore, and restructure the handloom industry in India.

Many other such organizations are helping artisans overcome the many challenges they face. However, online platforms and eCommerce websites like Etsy, Folksy, Amazon Handmade, and others have helped create a viable worldwide path forward for the handmade industry. 

While not every product fits the artisan-made model, the lessons from this growing trend apply to all categories. Consumers want to feel connected to the story behind the product, how a product is made, and the feel-good impact on the environment and people after purchase.

For more insights into the shifting trends in online shopping and consumer behaviour around the globe, download our complete report, “The Future of Online Shopping.” 

Digitization has reset the online shopping game board, and the pandemic has accelerated technology adoption by both brands and consumers. Today, the most successful retailers have adopted technology at warp speeds. With breakthrough technology complementing every step of the retail process, where are we headed? 

Download our complete report, “The Future of Online Shopping,” to find out.

Here’s a summary of the most significant trends shaping the future of online shopping worldwide. 

Trend 1: The Future is ‘Phygital’ — Reinventing the retail experience. 

At the intersection of physical and digital is a connected retail environment where consumers are placed at the centre. In this consumer-centric, channel-agnostic, connected environment, consumers can buy online and pick up from stores.

They can try clothes and accessories virtually, in-store or online, browse large touchscreens for product information, dispense products from vending machines, and even scan an aisle in a grocery store to view an overlay of information about products. 

The future of retail is omnichannel, an approach providing customers with

 a unified shopping experience. This approach connects experiences across multiple touchpoints, including brick-and-mortar, web, and mobile apps. 

Discover how Singapore’s NTUC grocery chain increased retention and repeat business using an omnichannel approach.

Stay ahead

Get regular insights

Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter.

Online Financing Options – “Buy-Now-Pay-Later.”

Retail brands are removing barriers to make the shopping experience as frictionless as possible, including easy financing terms. 

Apps Making Online Shopping Seamless.

Mobile apps offer retailers an engaged audience they can easily connect with to sweeten their shopping experience, building loyalty and driving in-store sales. 

Download the complete report to discover how Shopee, the leading eCommerce online shopping platform in the Philippines, Taiwan, Thailand, Singapore, Malaysia, Indonesia, and Vietnam, and Sephora, a multi-brand beauty retail store, leading the way in making the shopping experience seamless. 

Trend 2: DTC brands are booming worldwide.

Direct-to-Consumer (DTC) has disrupted the eCommerce industry. As more brands manufacture, design, market, sell and ship their products directly to customers, they are more agile than traditional brick-and-mortar retailers. 

Download the complete report to learn how Nike tapped into the DTC space along with other legacy brands.

Social media advertising significantly contributes to DTC sales; however, rising ad prices damper many of these brands. 

Download our report to discover how DTC brands target users in a cookieless world. 

Also, learn how a home-grown Vietnamese DTC start-up raised USD 2.3 million in the middle of V.C. winter in the country. 

Shein, another DTC brand based in China, adopted and perfected its business model and developed a massive, vibrant, international community around Shein with a customer-centric approach. 

Download our report for the complete case study and discover how Shein has tapped into a massive international market of online fast fashion shoppers in the U.S., Europe, the Middle East, and other big consumer markets. 

Trend 3: Influencers are the new sales associates.

In a crowded digital space, where media consumption is highly democratised, brands seek attention by creating entertaining content that moves the audience. 

Consumers are now in charge — and rather than listening to brands, they listen to peer-to-peer advice on products and services. Consumers are increasingly filtering content, ads, and posts that reek of brand promotions in favour of posts and promotions from people they trust, a.k.a. Influencers. 

So who are the top Instagram influencers right now? 

Download our report to find out who owns the top spot for earnings per paid promotion, and learn how Kim Kardashian sold 150,000 bottles of perfume within minutes on a live stream in China. 

Trend 4: Personalizing the online shopping experience. 

Customers have spoken. They don’t just want personalization; they expect it from brands. 

Research shows that when brands provide personalised experiences, 80 percent of customers are more likely to purchase. When brands personalise a customer’s experience, they anticipate what they want and deliver it to them, increasing engagement, improving conversions, boosting customer loyalty, enhancing the experience, and gaining a competitive advantage. 

Download our report to find out how U.S.-based grocery chain Kroger is delighting shoppers with next-level personalization strategies in our brand case study. 

The future belongs to retail brands that master the omnichannel experience.

Consumers are tightening their purse strings due to inflation and the fear of an impending recession.

High prices of fuel and food are impacting consumer spending. It’s time for brands to get more creative, and eCommerce sellers are in a favourable position to weather the economic downturn using competitive pricing software and data-rich touchpoints. 

Download our free report to find out how top retail brands are globally navigating the new online retail playing field during these uncertain times.