If you own a beauty business, it is imperative that you stay up on the industry trends so that you understand the market and know how to meet the ever changing needs of your existing customer base, how to attract new ones, and ensure that you stay ahead of your competition.
A recent report from consulting agency McKinsey determined that beauty service providers such as spa and salon owners could diversify their revenue streams in 2023 and beyond, but “will need to expand product sales, develop partnerships with brands and retailers to help expand their footprints, and upskill their employees.”
Since we know firsthand how much work is involved in running a business, we dug into all of 2023’s beauty trends to find you the most important ones that you need to know about to make sure your beauty business stays ahead of the curve.
Demand For Non-Invasive Procedures Will Continue To Grow
Non-invasive aesthetic procedures like cryotherapy, microneedling radiofrequency, lasers, and other energy-based devices are becoming exceedingly more popular, and analysts don’t suspect this trend will go anywhere but up. The consumer drivers behind this trend are due to the fact that non-invasive treatments typically require less downtime, have less risk of scarring, are typically less expensive when compared to surgery (although some treatments require multiple sessions to achieve the desired results), and generally speaking have a lower likelihood of risks often associated with surgical treatments.
In fact, the global market for non-invasive aesthetic treatment market size was valued at US$ 52.57 billion in 2021 and is expected to reach over US$ 150.6 billion by 2030 with a registered CAGR of 12.4% from 2022 to 2030.
All of this is to say that if you aren’t staying ahead of the curve and offering your clients the latest non-invasive technologies that help address their skin and body concerns, you could be missing out on new revenue opportunities while also missing out on attracting new clients who are seeking these treatments.
These days everything is getting digitized and the same applies to the beauty industry. Whether it is online bookings, touchless check-ins, digital consent forms, social media, beauty tutorials, or using artificial intelligence and virtual reality to analyze the skin, visualize new hairstyles, and lashes, or even show expected results from a procedure—the digital transformation of beauty is a trend that is here to stay and is expected to grow especially since these tools can help deliver a better customer experience for your guests and help you achieve a higher level of growth for your beauty business. So, if you aren’t already adopting digital ways to market and streamline your business, you should consider doing so or risk falling behind your competition.
Retail Offers Beauty Business Owners Additional Revenue Streams
According to consulting agency Mckinsey, one of the fastest areas for growth for spa and salon owners is retail. In fact, they estimated product sales from beauty businesses to grow from $4 billion today to $6 billion by 2027. For locations that have traditionally only offered beauty services, adding complementary product offerings has helped to build better trust-based relationships with customers while also providing opportunities for education and cross-selling. On the other side of the coin, some retailers are experimenting with offering services for the same reasons.
If you aren’t selling retail products to your customers (or online) that enhance the benefits of your services, you could be missing out on an opportunity to add more value to your clients and missing out on an additional revenue stream.
Offering Premium Services To Elevate The Customer Experience
Making the customer experience an unforgettable one is one of the keys to winning in the beauty service space, like the retail sector. Providing your clientele with a luxurious environment with premium services is the foundation to building loyalty with your current customers as well as attracting new ones. If COVID taught us one thing, services like nail care, facials, and simple hair coloring could be done in the comfort of one’s home. So, if you aren’t offering premium services that can’t be done at home, your beauty business could be missing out on untapped revenue potential.
Cryotherapy Is On An Upward Trend
The practice of cryotherapy where using precise cold temperatures to benefit the appearance of the skin by increasing blood flow and enhancing cell regeneration naturally is rapidly becoming a significant trend in the world of beauty.
According to findings from Restore Hyper Wellness (Restore), consumers are certainly willing to make sacrifices in other areas to continue to afford health and wellness spending. In partnership with Wakefield Research, Restore surveyed 2,000 U.S. adults to determine the interest in hyper wellness, which is “grounded in 9 Elements everyone should incorporate into their daily lives both inside and outside of Restore’s four walls: oxygen, hydration, nourishment, cold, heat, light, movement, rest and connection. This category of care combines groundbreaking science with expert guidance to help consumers proactively improve their health.” Their findings concluded that 67% showed interest in trying at least one Hyper Wellness offering, with the most common being extreme heat and cold exposure to target fat cells and slim down (28%).
If you aren’t offering facial or body treatments that deliver cryotherapy to the skin, you could fall behind your competition.
Simplifying Skincare Routines & Products
The pandemic changed a lot of things including many choosing to wear less or no makeup at all. In a recent study, when compared to 2019, cosmetic purchases went down by 19% only making up 16%v of the global market. Skincare sales however, skyrocketed and now account for 42% of the global market, which is expected to be valued at $177 billion by 2025 in the United States alone.
Furthermore, there is a growing demand from consumers who are interested in sustainability especially when it comes to refillable packaging for beauty products that are historically known to be wasteful) and upcycle packaging. According to market research firm Mintel, the reusable packaging market for beauty and cosmetic products increased by 65% from June 2020 to May 2021 solely in the U.S. — and is expected to rise each year as customers demand transparency from product manufacturers and the businesses they patronize.
If you are selling skincare and cosmetics in your beauty location, you may want to consider creating a mission statement defining for the public what sustainability means for your business and how those values are applied in your operations. Your mission statement could also include your company’s ethos on the products you choose to use on your clients. Either way, consumers are demanding transparency and sustainable, clean products that are both good for the skin and the environment.
Major Shifts In The Service Provider Market
In Mckinsey’s latest examination of the beauty service industry, they found that the pandemic caused long-lasting disruption to the service provider market, with the pipeline of professionals with less than three years of experience being most affected out of the 75 percent of those who left the industry all together due to mandated closures. Several years later, this has led to a labor shortage, especially in the growing field of aestheticians, which has led to rising labor costs across all beauty services and an increase in the competition of talent.
This trend is important to understand since every business owner needs to know how to calculate expenses (including the cost of employees) to determine profit margins.
If you are active on social media, then you know that TikTok is a platform to find viral skincare trends and routines. If you want to stay ahead of the curve and learn what consumers want firsthand, then TikTok can be a great resource.