Hopping on a viral social trend can bring short-term visibility, but it’s the innovations that tap into customer behavior and address emerging needs that have staying power. The rise of livestream shopping and social commerce has transformed online shopping from a transactional experience to a more interactive and personalized journey. These shifts, driven by the demand for convenience, connection, and tailored recommendations, highlight how certain trends become embedded in customer expectations, ultimately shaping the future of e-commerce and influencing how brands must operate to remain relevant in an evolving digital landscape.
In a panel on the current state of e-commerce at BeautyMatter's 2024 NEXT Summit, BeautyMatter co-founder and President John Cafarelli sat down with Alexandra Keating, founder and CEO of Uni; Jeff Lee, co-founder and CEO of DIBS Beauty; and Carina Chaz, founder of DedCool to discuss the e-commerce strategies that are working today and what’s next for the industry.
Chaz and the team at DedCool view its retail landscape as an interconnected ecosystem, blending digital and physical channels. Although the brand started on Instagram, its initial growth relied heavily on small, local shops, with consignment sales funding its digital expansion. In fragrance, DedCool focuses on creating unique, experiential stories online, enhancing brand storytelling and consumer engagement through digital content, user-generated testimonials, and brand moments. This digital presence is essential for driving awareness and supporting its retail partnerships, like Sephora, where consumers can have a tactile experience that complements DedCool’s digital engagement.
"We view everything as a means of building awareness and driving growth, ultimately establishing a digital brand presence that exists within an omnichannel ecosystem,” says Chaz.
Shifting to cosmetics, Lee discussed the challenges of selling color products in an online-only environment. He acknowledges that it's impossible to fully resolve the differences in how colors appear on various screens compared to real life. To tackle this issue, DIBS focused on creating an experience that emphasizes "stress-free shade selection" by offering easy-to-use and blendable products like blush and bronzer sticks.
Despite these challenges, Lee emphasized the importance of an omnichannel approach, noting that DIBS’ recent launch in Ulta significantly impacted its e-commerce business. "We don't believe that we exist in a universe where shade selection can be fully solved,” he stated.
In contrast, Uni is almost entirely online-focused. Keating explained the advantages of this strategy, particularly for emerging categories like fragrance and bodycare. "We really knew that in order to come out of the gate strong and win, we had to be digital-first," she said. This allowed Uni to deeply understand its customers and use first-party data to drive its retail growth.
"I know my customer. I know exactly what they want [and how] they'll transact, so I can essentially make sure that I'm profitable and use that digital business to drive retail when I go there, which is a huge advantage to be able to rely on that," says Keating.
The discussion then turned to the challenges brands face on social and search platforms. Lee acknowledged the saturation and high costs of influencer marketing, noting that the customer is so much more discerning now. He emphasized the importance of creativity and personalization in this space, rather than relying on traditional tactics like promo codes.
Chaz echoed these sentiments, highlighting the difficulty of both acquiring and retaining customers in the digital space. "You always have to look to the consumer, where they're shopping, and the trends that they're looking at. And for us, it's harder than ever not only to acquire but to retain," she said.
Keating, on the other hand, has found success by using influencers as the foundation of Uni’s entire marketing strategy.
"Everything starts with influencers,” she explained. “We use them to identify creators, who then run all of our ads and become integral to our advertising strategy.” This has allowed Uni to identify high-performing creators and build deeper relationships with them.
The panelists delved deeper into the role of influencer marketing, with Lee revealing that his company's largest full-time department is dedicated to this channel. "We invest in it as a means of communicating because the fact of the matter is, we have not cracked the code on standard paid media," he admitted. “We don't believe we are getting the ROAS [return on ad spend]. The fact of the matter is, we don't believe that those strategies will bring the ROAS that we need to propel the business, and we know our native strength, which is the creator community.”
Lee emphasized the importance of nurturing personal relationships with creators, noting that every team member is tasked with engaging with the brand's community. "Every single member of this team is dedicated to nurturing some level of relationships with our creators," he shared.
The conversation then shifted to the role of collaborations and brand partnerships in the panelists' strategies. Chaz explained how these types of initiatives have been a major success for her fragrance brand, allowing them to activate and capture a consumer that they may not have been able to reach through digital channels alone.
"Not only is it a fun way to engage with brand ‘friendlies,’ but as you all know, the beauty world is quite small. Collaborating with larger brands allows us to learn from them and create buzz in this saturated market. We view these partnerships as halo-building opportunities to generate products that spark conversation.”
DedCool collaborated with OUAI to create a laundry detergent featuring their iconic Melrose Place scent, which helped the brand reach consumers it may not have accessed digitally without significant investment.
She emphasized the importance of finding the right brand partners that align with their brand ethos and can help them reach new audiences. "Ultimately, we want to work alongside people we sit on the shelves with at Sephora and capture a consumer with the same ethos."
The discussion then turned to the critical topic of customer retention, with the panelists acknowledging the high customer acquisition costs in the current e-commerce landscape. Chaz explained that her brand has a full team dedicated to retention, and its product strategy is heavily focused on creating consumable items that drive repeat purchases. Consumables obviously have a longer lifetime value with the consumer. In our category, specifically, people are very, very loyal to their scent, so we’re lucky. People can ultimately create more of this full-scope experience within their favorite fragrances.”
Lee emphasized the importance of customer service and personalized experiences in driving retention, including "surprise and delight" elements for their top customers. "We have a full-time CX [customer service] person who is a superstar in her role. Our digital team dedicates half of its efforts to hypersegmenting our customer base through Klaviyo. We're also implementing a CDP [customer data platform] program to delve deeper into the various customer profiles."
Keating also highlighted the role of subscriptions and surprise and delight programs in her brand's retention strategy, noting that they've found it more effective to push customers into subscriptions on their first purchase rather than trying to upsell later.
Looking ahead, Keating predicted the rise of personalized websites and the use of AI to create custom sales channels and improve retention. "I think you'll have personalized websites, [similar to] how I'm approaching landing pages. We’ll reach a point where we can tailor experiences for individual customers or cohorts, understanding their aspirations—what they wear, the jewelry they choose, and the brands they prefer. This approach will create a seamless journey throughout the entire process."
Lee and Chaz highlighted the promise of personalized customer experiences, with Lee pointing out the limitations of AI in product formulation. "The potential for personalized customer experiences is the most immediate opportunity we can expect in the next few years. However, I'm less optimistic about AI's ability to transform product formulation and customization—we're not quite in that era of agility yet."
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