Piper Sandler has been conducting a semi-annual survey for 20 years on self-reported teen spending. We’ve done a beauty edit of the 40th edition of the Taking Stock With Teens Fall 2020 Survey, but if you want to know what makes Gen Z tick, take a deep dive into the full report to get context and inspiration on how to connect with the new beauty consumer.

“One distinguishing feature of Gen Z is that they are a generation that cares about social justice. Racial Equality / Black Lives Matter and the Environment are their top current issues. With Environment at the forefront of their minds, we are seeing an uptick of teens ‘thrifting’ or shopping secondhand. We believe this will be a very important trend to watch in the future,” said Erinn Murphy, Piper Sandler Senior Research Analyst.

Piper Sandler surveyed 9,800 consumers with an average age of just under 16 from 48 states, with an average household income of $67,500, from August 19 to September 22.

General Spending Insight:

• Gen Z contributes approximately $830 billion to US retail sales annually.
• Teen spending hit an all-time low during the coronavirus pandemic; Gen Z annual spending has fallen 9% YOY and 5% since the spring to $2,150.
• Reported annual spending by teens peaked at about $3,023 in the spring of 2006.

The COVID-19 Impact:

• 76% of teens went back to school either in a hybrid format or fully virtual.
• 8% of teens or an immediate member in their household have had COVID-19 (vs. national average of 6%).
• 48% of teens believe the economy is getting worse vs. 47% in spring and 32% last fall.
• 33% of teens have a part-time job—this is down from 37% in spring 2020 and 35% in fall 2019.
• 23% of teens indicated that COVID-19 has impacted their ability to find work.

General Beauty Insight:

• Skincare spending exceeded cosmetics spending for the first time in our survey history.
• Cosmetics is down 20% Y/Y as the pandemic is further altering behavior.
• Skincare for females was only down 3% and skincare for males was up 12%.
• Personal care remained the No. 3 wallet choice for females at 11%—up 100 bps from fall 2019.
• 84% of females use online influencers as a source of discovery for beauty brands and trends, which is an increase from LY.
• Word-of-mouth (“Friends”) remains the second most important decision influence when making a beauty purchase.

Top Ten Beauty Retailers:

1. Ulta 42%
2. Sephora 20%
3. Target 11%
4. Walmart 8%
5. Amazon 5%
6. CVS 1%
7. Walgreens 1%
8. Glossier 1%
9. Ipsy 1%
10. Morphe 1%

Ulta vs Sephora:

• Ulta is the No. 1 beauty destination among teens at 42% share, up from 39% in spring and 38% last fall.
• Relative to No. 2 Sephora, Ulta strengthened its lead, now 22% ahead vs. 15% last year.
• Sephora stays at No. 2 but moves to 20% share vs. 26% last year.
• Ulta took lead over Sephora among upper-income teens for the first time in the survey history.
• 86% of female teens preferred shopping for beauty in-store vs. online, down from 90% in spring.

Retail Insights:

• Since COVID-19 began its spread domestically, 84% of surveyed teens said they have visited a retailer, but going forward that share dropped to 81%.
• 54% of teens cite Amazon as their No. 1 favorite e-com site.

Top 10 Skincare Brands:

1. CeraVe 28%
2. Neutrogena 10%
3. Cetaphil 10%
4. The Ordinary 8%
5. Clean & Clear 3%
6. Clinique 3%
7. Curology 2%
8. Mario Badescu 2%
9. Proactiv 2%
10. Rodin & Fields 1%

Skincare Insights:

• Skincare spending for all female teens was $101/year—down 3% Y/Y and down 4% vs. multi-survey avg. of $106.
• Skincare spending exceeded cosmetics spending for the first time in our survey history.
• CeraVe strongly jumped to the No. 1 position from No. 10 last Fall and No. 7 in spring, likely driven by engagement on TikTok.
• Mario Badescu dropped from their stable No. 2 position to No. 8 with 2% of the vote an indication that the VSCO girls trend has slowed.
• The Ordinary shot to No. 4 while Rodan + Fields broke into the Top 10; Curology furthered its upward movement.
• Clinique’s share has dropped since spring 2019 and now represents 3% of teen share.
• Aveeno dropped out of the top 10 to No. 11 while Bioré dropped from No 7 last fall to No. 22 this fall.

Top Ten Cosmetics Brands:

1. Tarte 7%
2. e.l.f. 6%
3. Maybelline 6%
4. Morphe 5%
5. Too Faced 4%
6. MAC 4%
7. L’Oréal 3%
8. Fenty Beauty 3%
9. Sephora 3%
10. Glossier 3%

Cosmetic Insight:

• Female spending on cosmetics dropped to $84/year, a 20% contraction Y/Y and 51% since the peak of $173 in 2017.
• Teen behavior has shifted from “everyday” (22%) makeup wearers to “sometimes” (55%) or “never” (23%) makeup wearers.
• Tarte remained the top-ranked cosmetics brand (6th consecutive survey) but decreased 400 bps to 7%.
• e.l.f. moved up from No. 4 to No. 2—the highest rank seen to date in the survey.
• Too Faced dropped from the No. 2 spot last fall to No. 5.
• MAC kept its No. 6 rank, albeit with 200 bps share loss.
• CoverGirl dropped out of the Top 10 and Anastasia Beverly Hills remained out of the Top 10.
• Glossier came into the Top 10 for the first time (among all female teens).

Clean Beauty Highlights:

• 57% look at ingredients and their beauty and personal care products vs 47% last fall.
• 78% are willing to spend more for clean or “natural beauty” products, up from 75% last year.

Social Media and Video Consumption:

• Instagram continues to lead the pack in usage and engagement followed by Snapchat and TikTok.
• TikTok moved up from 62% in spring to 69% this fall.
• Snapchat was the No. 1 preferred social media platform.
• TikTok moved up to the No. 2 spot from the No. 3 spot, unseating Instagram, which moved down to No. 3.
• The average teen claims to spend 12 hours per week on social media.
• On average, teens spend 34% of their daily video consumption on Netflix, up from 33% in spring 2020.
• YouTube gained 100 bps share and remained in the No. 2 spot at 32% (vs. 31% in spring).