Digital beauty sales rose 14% year over year in 2016: one in every five beauty purchases online was made through Amazon Marketplace, according to new research released this week from data analytics firm 1010data.
Nevertheless, the online cosmetics market is highly populated and no brand has more than a 6% share, with only eight brands having more than 2% share.
Estee Lauder's MAC Cosmetics brand stands out as the leader in the overall market with a 5.1% share, and lip products at 13%. Overall, the No. 2 is Clinique, which is also owned by Estee Lauder. Clinique is No. 1 for face makeup.
People prefer to buy cosmetics online, according to Courtney Buechert, the CEO of Eleven, a creative agency that works with privately held beauty brand Julep. When customers have a regime of beauty brands they've tried and used, they shouldn't have to go to a physical store to get them, he said. "You know what you want. You want the ability to order it," Buechert said. An online channel allows recurring customers to buy in a more seamless way, he added.
Brands with high-conversion rates are successfully promoting and pricing their products, 1010data said. "Estee Lauder and Clinique have fewer product views than their competitors; they could boost sales even further by investing in advertising and awareness strategies," the report noted.