In this extract from Ragtrader's 2023 Fashion and Beauty Report, chief digital officer Amy Hoare and CEO Scott Evans reveal how Mosaic Brands' online beauty sector has changed post-COVID.
“Beauty is one of our top-performing and fastest-growing online categories,” Mosaic Brands CDO Amy Hoare says. “We have over 50,000 products within the category available and are continuing to grow.
“We have new additions to our sites almost every week, especially in the hair, skincare, and fragrances categories.”
Including its recently acquired EziBuy, some of Mosaic Brands’ subsidiaries also sell beauty products, including Millers, Katies, Noni B, Rockmans and its pureplay online brand Beme.
Hoare adds that hair tools and accessories (eg. hair removers, trimmers, shavers) are the best-performing categories right now, with continued growth in skincare.
“We feel skin care will further accelerate as consumers continue to shift their perception and focus on self-care and anti-aging.
“With the increase in sales across hair and beauty tools in particular, we believe this trend is a result of consumers now venturing out of the house given no more COVID lockdowns.
“In addition, given the rising inflation and cost of living pressures, some consumers may be sticking to being an ‘at-home’ beautician or hairdresser rather than visiting the salon.
“The challenges are not unique to the beauty space, however, as cost of living pressures continue, consumer spending as a whole may tighten further.”
According to Hoare, only a very small range of beauty products are available in-store, making its digital arm a key channel for the category.
Mosaic’s largest subsidiary EziBuy attracted the largest amount of site visitors in FY22, at 21.3 million, with an email database of over 2 million and 2.7 million members.
Its second-largest subsidiary to offer beauty products is Millers, with 11,1 million visitors in FY22, 1.9 million in its email database, and 5 million members.
Online now contributes around 36% to overall group revenue, according to its FY22 report.
Hoare says its online department store strategy has allowed the group to now offer over 8 million SKUs spanning 60 categories. This is up 229% against the first half of FY22.
According to CEO Scott Evans, Mosaic Brands’ online sales grew to $223 million in FY22, up from $151 million in FY20.
“This growth not only highlights that older consumers are shifting to online but also that the Group is strongly positioned to serve an emerging cohort of customers for whom online shopping is becoming second nature,” Evans says.
He says the company has already implemented a ‘Big Strategy’ to adjust to changing consumer demands post-COVID.
Mosaic has invested in a new distribution centre to tackle rising online sales and continued to close stores with unrealistic rental expectations.
From these initiatives, the group reported a 195% increase in earnings for the first half of FY23, with consumers aged 50+ driving post-pandemic growth.
Its total sales increased by 23% to $267 million for the first half to January 1, with a 12% lift in comparable store sales and a 0.3% growth in online.
Evans claims the strength of its core customer base drove the result.
“Although the over 50s largely missed out on JobKeeper and other subsidies from the Government during the pandemic, they have accumulated significant savings on hand of up to $200 billion,” Evans says.
“They are amongst the most resilient in the face of interest rate rises with relatively lower exposure to mortgage pain and, in Australia, they are emerging as one of the most powerful consumer segments in retail.”
This perhaps explains why skincare is being pinpointed for growth online, as Mosaic’s aging consumer base strives for youthful looks.
Hoare says Mosaic will continue to expand the beauty category online, noting it complements its fashion apparel and footwear offering.