The beauty industry will undergo a fundamental shift due to the cost-of-living crisis as consumers demand fairer pricing, greater product efficacy and more open and honest business models, according to a new report by premium beauty and wellness company, Beauty Pie.
The ‘Beauty Futures 2025: Beauty, Beautility and the Rise of the 'Question Everything' Economy’ report, released in partnership with The Future Laboratory, reveals that a period of financial uncertainty, increased free time during the pandemic, and greater access to information has created a generation of hyper-knowledgeable consumers expecting brands to provide more honest about their products - from efficacy to supply chain.
Consumers are demanding that beauty brands be more open around supply chain ethics and carbon footprint, as well as radical fairness and financial inclusion, explains Beauty Pie, spurred on by the growing cost of living and climate crises.
The report reveals that whilst fifteen of the leading beauty brands source products from the same three manufacturers, post-manufacturing hyperinflated markups are causing many to pay higher prices for products with the same base ingredients.
As people continue to re-evaluate their spending habits and become more knowledgeable about these varying cost structures, Beauty Pie believes that consumers will demand radical fairness in the industry across everything from price point to product efficacy. This shift will fundamentally change associations of higher price being linked to quality, placing more pressure on brands to prioritise shared values and demonstrate fairness and functionality. Customers are now 20 percent more likely to invest in a brand that is honest about its pricing.
Consumers looking for beauty brands to be more honest and open
Beauty Pie adds that consumers are no longer looking to be 'sold' a product, but are instead demanding the facts, from ingredients to proof of product effectiveness. As consumers become better educated, they are approaching products with the same eye that they bring to their nutritional choices by focusing on base ingredients, their scientific benefits and where they are sourced. As a result, searches for ingredients climbed by around 229 percent in 2021.
Marcia Kilgore, founder of Beauty Pie, said in a statement: "We commissioned this report to explore the evolving attitudes to luxury and fairness, and the growing consumer instinct to be part of something bigger – and to see if our instinct that overpaying is officially over is correct.
“Our customers, who are juggling mortgage payments and petrol prices, and school fees, can surely find something better to spend their money on than mark-ups. And we believe that being ‘the fairest of them all’ when it comes to our members’ pricing gives us lasting power and loyalty that mainstream beauty brands are in it to lose.”
The Future Laboratory's co-founder Chris Sanderson added: "Across generations and across the world, people are now looking for experiences, services and products that help them become better versions of themselves. This mission to be healthier, wealthier and happier is leading to the rise of the transformation economy, putting new demands on brands to deliver more meaning to their customers.”