The beauty industry is famous for its discerning audience with their precise tastes. But how influential are its consumers really? What level of control do they wield over product success and market position?
In this case study, we aim to uncover the fact that ratings truly can be a beauty brands’ buzz kill .
Methodology:
In our rigorous analysis spanning November and December 2023, we delved into ten key subcategories within the beauty industry. The objective was to decipher the intricate relationship between consumer sentiments and brand standing amongst 7000 unique SKUs.
Within this expansive canvas, three compelling instances emerged, revealing how ranks and ratings play a crucial role on the brands’ image in the marketplace.
Sunscreen stages the spotlight:
According to Cognitive Market Research, the Global sunscreen market size is USD 12.3 billion in 2023 and will grow at a compound annual growth rate (CAGR) of 5.60% from 2023 to 2030.
North America will continue to lead, whereas the Asia Pacific sunscreen market will experience the strongest growth until 2030.
Thus , for sun proofing your brand against the perils of neglected ratings, we conducted a study of the product & the relationship between the ratings and its product ranking.
We analysed a product under sunscreen namely ‘Daily Defence Tinted Sunscreen,’ and it showcased a very fascinating behaviour that compelled us to delve deeper.
This product saw a 6% rise in its ranking from 4th November to 11th, and the ranking improved from 386 to 362.
But then around 25th November, its rank increased by almost 14%, landing the product with a rank of 310 . An interesting behaviour was that its subsequent rating grew too.
With a small fall in its rank on 2nd December, the rating is observed to move down again.
This relationship between Rank Position and Rating is explained by the concept of Correlation. The correlation measures the dependency of a relationship between two variables. A positive correlation indicates if one variable goes up its relational variable follows the same movement. On the other hand, a negative correlation showcases the relationship between variables which move in opposite directions.
The correlation between ranks and ratings in the above mentioned sunscreen example is approximately -0.9326. This negative correlation suggests that as ranks improve, ratings tend to increase, and vice versa.
What is evident is that this behaviour replicates in numerous instances!
Let’s consider the category of hair serums.
Hair Serum takes the baton:
Serums are the new buzzword in the skincare and haircare industry with many people trying them out. Hence, we included the buzzword for 2023 also for our analysis, because why not !
The product in analysis falls under a popular brand and has evidently gained popularity throughout the months of November and December.
As a result of the continuous rise in its ratings( from 3.6 to 4), the rankings have significantly increased(62 to 56) too .
The correlation between them is approximately -0.9946! This is almost an instance of perfect correlation which means the movement in one variable significantly impacts the movements in the other. Every movement in ranking is closely mimicked by a similar movement in ratings.
Better rankings helps you achieve better visibility in catalogue pages, which increases the brands’ potential revenue as more customers can have an opportunity to buy visible listed products.
Premium Realities:
Lastly we analysed products under the category of face wash.What’s unique about this product is that it falls under a premium label. Now, the question which pops in your head should be-Why Premium?
Well, because the global premium cosmetics market leads to an estimated CAGR of 6.14% in the global market during the forecast period and registers a revenue valued at US$ 116.23 Billion in 2023 and is expected to cross US$ 210.92 Billion by 2033. The growth in the market is ascribed to the following:
The demand for premium cosmetics is increasing owing to the changing fashion trends globally.
In recent years, both consumer awareness and the shift from mass-produced to luxury products have increased significantly.
We believed that premium brands generally display a higher resistance level against critical market factors. Their established reputation allows them to be at a greater advantage. But the data analysis had an altogether different story, However we uncovered a different instance.
The range of ratings under these products are extremely large. This product’s journey right from november started with a rating of 2 indicating a low level of popularity among its consumers. By the month of December , the rankings improved to almost 4.1! This rise in ratings has closely increased its popularity resulting in a strong correlation of -0.97.
Therefore it is observed that even premium brands are not immune to the discerning eye of consumers. Ratings and reviews are some of the only metrics consumers can wield in order to truly gauge a product’s utility in the market. Regardless of the brand reputation, businesses need to pay attention to the voice of its customer base.
Conclusion:
The strong correlations observed underscores the industry’s sensitivity to the authentic voices of consumers under the beauty industry. The beauty industry is highly vulnerable to its consumers in steering the success and industry standing of these emerging players.
BRIO, your AI-based dynamic pricing engine can help you with this. Its Sentiment Analysis module can help your brand understand exactly what your audience is thinking about. A review left unaddressed or ratings left unobserved can have huge implications for your brand. BRIO’s nuanced sentiment analysis can help you categorise and generate actionable insights to enhance your brand presence in the industry.
BRIO doesn’t just stop at sentiment analysis—it offers a complete 360-degree retail solution. By meticulously considering subtle factors that influence product ratings, such as listing optimization, pricing strategies, and even brand behaviour, BRIO ensures that your brand not only meets but exceeds customer expectations.
In this cutthroat industry of beauty where every detail matters, elevate your retail experience with BRIO and stay ahead of the curve.
Book a demo of our automated retail solutions or contact our optimization experts at info@sciative.com.
To see how brioanalytics.ai can empower your brand, ensuring it not only survives but thrives, visit sciative.com
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