L’Oréal’s makeup sales are set to bounce back to pre-COVID-19 pandemic levels, the French group’s new chief executive said on Friday, with women opting for brighter colours in their post-crisis makeovers.
Cosmetics groups were hit by shop closures and consumers shunning makeup during pandemic lockdowns, with many people spending online instead of on items including premium skincare.
Nicolas Hieronimus, a L’Oréal veteran has become CEO just as vaccinations alter the landscape again, prompting not only a return of products like mascaras but other changes the firm may have to adapt to as people try to break with the crisis.
Women have recently been opting for bolder shades of hair dyes such as blue, Hieronimus told Reuters, a potential sign that brighter makeup colours could also be on the cards.
“It’s a clear indicator people want to indulge themselves, they want to have fun, and express their differences and their individuality,” Hierominus said. “It’s a good omen.”
Makeup sales in countries such as China and Israel, where shops are open and COVID-19 constraints have largely lifted, have yet to reach 2019 levels but could do so this year, Hieronimus added in an interview.
“We’re monitoring online and social network conversation topics, and in the United States recently the volume of conversations around makeup reached an all-time high.”
The cosmetics slump hit 2020 revenues at L’Oréal and its consumer products division, home to brands like Maybelline, with group sales falling 6.3 percent to 28 billion euros ($34 billion), although they began to pick up in the second half.
The world’s largest beauty company will try and maximise the bounce-back with product launches, including a planned cosmetics range for Italian luxury label Valentino, Hieronomus said.
Some brands also shook up product development mid-pandemic.
Nyx’s “Shine Loud” lip gloss, rolled out earlier this year, was designed as non-transferable onto surfaces such as clothing, but face masks were also taken into account in marketing campaigns, Hieronimus said.
Hieronimus, 57, who started out at the Garnier shampoo brand and has run L’Oréal in Mexico and later its luxury products, faces other challenges, including rising demand for natural ingredients in beauty products.
L’Oréal is also investing heavily in “beauty tech”, which ranges from platforms allowing customers to try on looks virtually, shopping models where hairdressers or dermatologists connect with consumers online, channelling data to predict trends, and using tech to shorten research timeframes.
“It will be an accelerator for the development of formulas,” Hieronimus said, citing the way artificial intelligence will help sift through stored data on ingredients and textures.
L’Oréal and other major cosmetics groups such as Estée Lauder face competition from small brands that have succeeded in recent years with attention-grabbing product changes and nifty social media campaigns.
E-commerce, at just under 30 percent of L’Oréal’s revenues, is likely to reach half of sales before the decade is out, the group has said, or within three years Goldman Sachs estimates.
This milestone has already been achieved in China, but will require investment in the group’s supply chain, Hieronimus said.
By Sarah White, Editing by Alexander Smith via BoF