How the coronavirus could have a lasting impact on the beauty industry

  • As a result of the coronavirus, beauty workers and retailers across the nation are struggling to maintain their businesses as usual, according to a new report from data company Poshly.
  • Speaking to Insider, Poshly CEO Doreen Bloch said beauty service workers, like makeup artists, are facing the most difficult challenges in the industry, as many salons have been temporarily closed.
  • She estimates that, in the future, people might become less reliant on beauty professionals and high-end cosmetic brands.
  • Visit Insider's homepage for more stories.

The beauty industry is changing rapidly in response to the coronavirus pandemic.

In a new report from data company Poshly, it's revealed that both cosmetic retailers and beauty service workers are facing unprecedented challenges to keep their businesses running as usual. Salons are closing across the nation, leaving makeup artists and hairstylists without work. Stores like Sephora have also had to temporarily close.

As a result, it's becoming increasingly clear that the pandemic will likely leave a lasting impact on the billion-dollar industry.

Poshly's new report analyzes how various beauty professionals will be impacted by the coronavirus pandemic

Speaking to Insider, Poshly CEO Doreen Bloch said the data company created its report after clients began asking how the virus could impact the beauty industry over time.

"Especially in the last two weeks, every brand has been really seismically impacted by the COVID-19 crisis, and so we felt it was important," Bloch said of her company's report. "I think everyone is just adjusting and evolving hour by hour around this crisis and its implications."

The report, which analyzes responses from 872 people in the beauty industry, focuses "primarily on the US." Still, Bloch notes that the coronavirus pandemic is a "global phenomenon" that's "really devastating for people's businesses" around the world.

Beauty-service workers are currently facing the biggest obstacles

According to Poshly's coronavirus report, one million service workers in the beauty industry are being impacted by coronavirus. Salons have been closed in the tri-state area since Saturday, and other states are now taking similar precautions. As a result, many makeup artists, hairstylists, lash artists, and more are without work.

"Fom our vantage point, the biggest hit will come to the small business owner and the freelancer who literally cannot do their craft at this moment in time," Bloch told Insider.

Poshly's report says one million beauty workers are being impacted by coronavirus.
AS photo studio/Shutterstock

For the time being, many beauty workers are shifting their businesses to focus on digital classes rather than in-person makeovers. Speaking to Insider, makeup artist Shalonda Peguero said she's one of them, as she began offering digital courses once beauty services were suspended in Seattle, Washington, where she works.

"I'm teaching a lot of people how to do their own makeup," Peguero said. "I'm charging a small fee for it, and surprisingly got a lot of people who wanted to enroll in the class, so that's been helping."

Though Peguero said she is ultimately "pretty worried" about the lasting impacts coronavirus could have on her business, she believes people are "always going to need makeup," especially once they begin to reschedule their now-postponed weddings.

Consumers might become less reliant on beauty professionals as a result of coronavirus

According to Bloch, social distancing and quarantines are now leading people to get creative and experiment with their looks. For example, she noted that people who have been "reliant on going to the salon for decades" are now trying to replicate their stylists' work using at-home hair kits.

"I think the reason we're gonna see this have a long-term impact is that even once the COVID-19 crisis is over, what we expect is that people will still be very cautious about their intimate experiences with service providers," Bloch said.

"I think you're gonna see a lot of consumers take a step and say, 'Is that the cleanest, most hygienic space that I can put myself in?'" she continued. "And I think that's going to be a long-term hit."

It's likely that people may visit hair salons less frequently in response to coronavirus.
Basyn / Shutterstock

Though there's nothing wrong with people learning new beauty skills, it's worth noting that this could severely impact the businesses of beauty professionals.

"As people say, 'Oh I can do a mani-pedi myself at home,' they might start to eliminate a few services," Bloch said. "And if you see people eliminate one service every other week, that is a major — like a 50% drop — to that business."

Beauty retailers will also face obstacles as a result of the pandemic

Cosmetic retailers have taken various approaches to handling the coronavirus. For example, many have temporarily closed stores to protect employees and customers from the pandemic. As a result, some of these retailers are now offering sales and free shipping on products.

"Retailers are going to be less hit because there's a way for them to shift quickly into an online-first model," Bloch said. "That's something that the services sector simply can't take advantage of."

Retailers like Sephora are available online while physical stores temporarily close.
Wilfredo Lee/AP

Still, it's unlikely that all beauty retailers will fare the same when the pandemic slows down. According to Poshly's report, consumers are now stocking up on brands like Dove, Maybelline, Neutrogena, Cetaphil, and Elf Cosmetics. Not only do some of these brands prioritize skin care over makeup, but they're also affordable.

"We simply are not seeing people in the data saying 'Oh I'm gravitating towards La Mer,' for example," Bloch said. "That's just not happening at this moment in time."

"We have seen this trend — a skin-care moment — that is taking place in the immediate crisis," she continued. "But I think in general, people are really gravitating towards budget-friendly self-care."

To stay afloat, retailers and beauty professionals should focus on their digital businesses

At the end of the day, the future of the beauty industry is uncertain. There's no telling how consumers will actually shop for makeup and skin care once the pandemic ends, and it's equally unclear if service workers will see lasting impacts from the virus. Still, Bloch believes there are steps both retailers and independent workers can take to come out on top.

"We're hearing from consumers that about two thirds of them are not interested in new product launches right now," Bloch said. "It just doesn't feel like the right moment to say, 'Hey, we have this new palette!'"

"Although there is a third of consumers who are receptive to that, the majority right now just feel like it's off tone for the crisis that we're in," she said.

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Instead of new products, Bloch said consumers are now "very eager" to gain "actionable information." For example, people want to learn techniques for applying different products and cleaning their makeup brushes — answers to which can be provided by both beauty brands and independent artists.

"We'll start to see an expansion of online events, livestreams, chats," Bloch said. "People connecting around a topic they love is going to be very important as well, so practitioners can really lean into that."

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