UGC and Cosmetics: A Vital Partnership

ugc and cosmetics

User Generated Content, as the name suggests, is the content created by users in the form of ratings and reviews, questions and answers, and images while using your products or services. As this content is created by customers themselves and not by brands or ad agencies, it’s considered to be 12 times more trustworthy in the eyes of everyday shoppers. The level of people’s trust is always high when they see that someone from their own league is really loving a business’s products.  And that’s precisely why UGC works in all kinds of industries and all sorts of marketing efforts. The cosmetics industry isn’t an exception–indeed, due to the intimate nature of beauty products, their sometimes-high price points, peculiarities of color and texture and more, UGC and cosmetics are a necessary combination for e-commerce. Let’s understand how cosmetics industry can be enormously benefited by the unbridled potential of UGC, and take a look at some examples.

UGC and Cosmetics: User Generated Photos

A major limitation of online buying is the lack of direct contact with the products. That luxury of touching and feeling the products lies with the physical stores. Obviously, people would prefer if they can touch and feel the product, or even try them. It is emphatically true for beauty products whose worth from the customer’s point of view depends on how it will look on him or her.

Even if the quality of the product, let’s say of a certain lipstick, is good, it doesn’t mean that every woman will buy it. Simply because the decision to buy a lipstick cannot be taken without considering her complexion and other features. That’s precisely why she needs to see a woman of her complexion and features wearing that lipstick. It will give her an idea about its suitability. This is where user generated photos can really pull the trigger by assuring her about the suitability of the lipstick!

A second major benefit of customer photos for beauty companies is that they can often work an aspirational angle. When a potential buyer sees all the different scenarios and looks that your products work in, your brand’s versatility and appeal are heightened.

One of the most straightforward ways to loop in customer photos with your marketing strategy is to use them with visual commerce software. A good visual commerce solution will automatically pull pictures and videos with a certain hashtag from Instagram and other social sources, and will also allow for direct uploads on your site. From that point, you can configure versatile galleries, use the content in marketing emails, put images on your PDPs, and more. Here’s an example from Sigma Beauty.

sigma beauty

You can also use visual commerce to enable Instagram shopping. Since Instagram is such a huge hub for beauty aficionados, it’s smart to make the journey from following to liking to buying as simple as possible.

And here’s a bonus tip: incentivize the contribution of customer photos with your loyalty program! To learn more about cosmetics loyalty programs, click here!

UGC and Cosmetics: Ratings and Reviews

The reason why ratings and reviews have always worked in every business segment has to do something with the human tendency of being cautious before buying anything. People want an assurance of the quality of the product that they are about to buy. And as we have already discussed, people cannot touch and feel the product on e-commerce websites to make even a rough opinion, they want something solid and strong as a proof. Ratings and reviews fill that void, and consequently boost conversion.

Just like with customer photos, if you have a loyalty program you should consider incentivizing the contribution of reviews. Ever since the hair care brand Ouidad started doing it they’ve seen a significant uptick in review submissions! ouidad loyalty actions

UGC and Cosmetics: Questions and Answers

Irrespective of the amount of information that you put on your product pages, certain shoppers will still want to know more. They might have questions like: What are the ingredients of the product, can it be allergic to a specific type of skin, and can it have side effects if used with other products, availability of the product, its durability and much more. If these questions remain in their minds, it’s likely that they’ll abandon their carts. Nobody buys when he/she is in doubt!

Questions and Answers effectively tackle this problem as by establishing a platform for your consumers to ask both specialists from your company and other consumers. Besides, it also helps in creating a community around your products where people can discuss and share their experiences. Naturally, it fillips the online presence of your brand. It goes without saying that the daily submissions of fresh questions and answers are key for your SEO prospects. It’s a clear cut win-win scenario!

Here’s a peek at what Murad’s Q&A solution looks like.

murad q&a

UGC and Cosmetics: Takeaways

1- Don’t let the photos shared by your customers go to waste. Put them on your social media pages, website, and other marketing campaigns.

2- Ask your customers to write what they really feel about your products. Even if some of those reviews are negative, they help in making your website authentic and boosting conversion.

3- Create a questions and answers platform where customers can ask their queries. That makes them more secure about their buying decisions and heightens engagement.

Note: For tips on referral marketing for cosmetics, take a look at this post. And to learn about cosmetics loyalty programs, don’t miss this one! 

The Beauty of Devotion: Cosmetics Loyalty Programs

makeup-beauty-lipstick-make-up

The mammoth $500+ billion per year cosmetics industry has been growing at an intense pace over the past few years and is in danger of over-saturation. While product quality is crucial for success, no one can deny the importance of marketing as well. Due to the nature of makeup and skin care products, the need for differentiation, and the necessity for customer engagement, cosmetics loyalty programs are a great bet. Let’s take a closer look.

Cosmetics Loyalty Programs: The Basic Parameters

Before running a loyalty program, a business in any industry has to look at the basic parameters that defines the feasibility of their would-be loyalty program. These basic parameters are purchase frequency, customer lifetime value and average margin. Now, let’s see how cosmetics loyalty stacks up.

Common sense and observation tell that cosmetics need to be replaced semi-frequently, as they are used on a daily basis and they have a short shelf life. Naturally, then, repeat purchase percentages are high It has been observed that once a customer has made more than 4 purchases with your store, they are likely to become a lifetime customer. Besides, a high rate of a repeat purchases ensures that the purchases will have a high order value. What it eventually means is there is a much higher customer lifetime value in the cosmetics industry than in many other industries.

A loyalty program shares a percentage of your margin with your customers. Thus, you must have margins to support this. As per the industry standard, any company with margins above 10% is suited for a loyalty program. This margin with cosmetics is 80%. It means that cosmetics loyalty programs are much more feasible than many others. In short, the cosmetics industry in general meets all the conditions that decide the feasibility of running of a loyalty program…and this is what ensures the successful proceedings of future steps.

Cosmetics Loyalty: The Switch Barrier

Unlike fine jewelry or the luxury car market, the cosmetics industry is not a niche market. It’s a cluttered and open market with a cut throat competition. Thus, if you’re marketing the same beauty brands that are available at other stores, in-person or online, customers know they can look elsewhere based on price or a better shopping experience. Customer retention here becomes an absolute necessity…almost like a sole element of survival! Of course, steep discounting is a solution. But that won’t lead you far ahead–it’s an unsustainable model.

A loyalty program, then, looks like a more logical and robust solution, as it allows you to put value at the center of your customer retention strategy via rewards.These rewards don’t necessarily have to be financial gains for the customers. It can be more than that. Of course, a discount of a few dollars may be hugely appealing to your audience. It’s worth testing and seeing.

However, you should also test to see how using products, special access to events, and more motivates them.  Known as product and experiential rewards, these are the rewards that give the feeling to the customers that they are getting more than a product from you. This will not just make them happy, but engaged too! Devising such experiential rewards doesn’t need a Herculean task. It can be achieved by very simple things…like giving free samples of your products. People are generally hesitant to spend money on a new cosmetic product, as they are not sure about it. But people will love to try it if they don’t have to spend a penny on it.

You can also offer gift cards or store credit as rewards, empowering your customers to choose whatever they want/ need to incorporate into their daily beauty routine.  And of course, other tried and tested rewards of offering an early access to your exclusive products or gifting them to your loyal customers on their special days are always there to step in. If you look at it clearly, you will realize that through these rewards, you have created a switch barrier in the customer’s mind by pinpointing the cost of switching.

The message is clear here: You will lose all those rewards if you decide to choose a competitor over me for your next purchase. It is human nature to maximize value and leaving points behind is counterintuitive to that nature. It will make customer to think twice before he decides to leave you and embrace your competitor. Cover FX’s rewards program is one such cosmetics loyalty program that doesn’t just rely on monetary rewards. It caters to the experiential level of customers too.

cover fx rewards examples

Cosmetics Loyalty: Elitism

Though many people, especially women, have made cosmetics products an integral part of their lives, you must not forget that it’s not among the basic necessities of life. Among many social circles, cosmetic products are a way to judge the disposable income of a person. Along with buying a cosmetic product, there is a hidden desire to buy a status. Of course, this statement might not apply to each and every cosmetic buyer, but while designing such programs, you have to think about collective consciousness and the majority’s thinking. And the fact of the matter is that the majority of cosmetic buyers associate certain brands with status and higher social standing. It’s perfectly possible to fan this need of elitism by creating a structured layer of rewards…where awards will be different for different people based on where they stand in the loyalty category.

MAC Cosmetics rolled out its Select Rewards loyalty program in the UK this year. The cosmetics loyalty program divides customers into three layers: Seduced, Devoted and Obsessed. The more a consumer spends, the higher he can climb up and the greater privileges he can unlock.

mac rewards

Rewards range from free product samples to limited-edition products for Seduced members; free express make-up application and complimentary two-day fast-track shipping for Devoted members ($150 spend or more in a calendar year); and first access to new products and a deluxe annual gift for Obsessed members ($500 spend or more in a year). As you can see, the customers are categorized based on their level of spending. The sense of elitism begins from this point. The higher the spending, the higher the category. Someone in an Obsessed category will feel more elite than those who are in the Devoted category. And believe it or not…it can become a motivation for many people to shop more from you.

Cosmetics Loyalty Takeaways:

1- Whether it’s purchase frequency, customer lifetime value or average margin, the cosmetics industry overall fulfills all the criteria that are necessary to decide the possibility of a loyalty program. It’s a proven fact now. So, instead of thinking about its feasibility, think about executing a loyalty program.

2- A cosmetics loyalty program with innovative and experiential rewards certainly acts as a deterrent to the customer’s decision to move away from your brand. He will think about the loss of the value proposition that your loyalty program has been offering to him through rewards.

3- Don’t forget that many cosmetics shoppers are often very motivated by prestigious status. Always keep this in mind while deciding a reward structure.

Note: For a great illustration of a cosmetics loyalty program success, check out Murad’s story. After combining UGC with a loyalty program, Murad saw an 18% increase in the conversion rate along with the acquisition of 150,000 loyal members in only 6 months.   Don’t forget to learn about the power of referrals for cosmetics, either! For even more loyalty insights, take a look at some of the following white papers and posts, too!

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