After a COVID-induced drop in sales in 2020, the makeup and beauty products market revenue has made a resounding recovery. Here are a few trends that show the upward growth trajectory of the cosmetics market revenue worldwide:
$511 billion was the revenue of the beauty industry in 2021
4.75% is the annual growth rate of the cosmetics industry
$716 billion is the expected revenue of the global beauty industry by 2025
16% of the cosmetics market share is held by makeup products
48% of beauty products sales will be done online by 2023
$276.9 billion is the projected worth of the men's personal care market by 2030
Source: Statista, Common Thread, Allied Market Research
The figures show one thing clearly, the beauty industry is all set to register 40% growth in the coming five years. What’s even more interesting is the fact that the men’s personal care market is also growing at a great pace. And, yes, buyers are no longer relying on offline cosmetics stores to buy their beauty fixes.
This is the age of ecommerce and makeup and beauty products online marketplace is the new normal!
Table of Contents
- Top reasons to build a makeup and beauty products Online Marketplace
- How to build a makeup and beauty products Online Marketplace
- Why choose a SaaS-based ecommerce marketplace builder
- Revenue model for your Multi Vendor Marketplaces
- Must have features in your makeup and beauty products Online Marketplace
- Why choose StoreHippo to build your beauty products Multi Vendor Marketplace
Conditioned by their experiences of shopping fashion and apparel online, the new-age buyers are also experimenting with shopping cosmetics, skin and beauty products online. With online beauty marketplaces offering the most amazing product catalogues, discounts and buying experiences customers have been flocking to the beauty portals like never before.
While some enterprise brands still prefer to have an inventory based-model for their business, more and more enterprise businesses are adopting the multi vendor marketplace model to set up their beauty and makeup products marketplace website.
Here is why brands are opting for the online marketplace model:
The zero inventory model makes it easier to get started without investing in inventory, warehousing etc.
Easy to offer a rich product catalogue to customers by onboarding dealers and distributors of cosmetics products as vendors
Scale up to new markets or product lines easily, the online marketplace brand just needs to onboard relevant vendors from the new location or product line
Attract more vendors by having good vendors in the beauty products marketplace which in turn boosts brand value
Multiple vendors bring in competitive pricing which minimizes site hopping in search of better pricing
Boost revenue by implementing multiple revenue channels apart from the regular commissions on each sale
The multi vendor marketplace model is a win-all model irrespective of the industry vertical. While the customers are happy to find a wide range of products and competitive pricing, sellers are happy to reach a wider audience base. Sellers also get freedom from the burden of maintaining the IT infrastructure. The marketplace brand owners and admin(s) on the other hand do not need to worry about inventory, shipping etc. They can focus on business strategies, growth and ways to boost their brand visibility and revenue.
Now, that we understand the benefits of building an online beauty products marketplace, let us get started with the process. When starting to build an online marketplace it is essential to take specific steps to determine your business direction and the challenges to overcome. So, we will see how we can move forward.
A successful multi vendor marketplace can be built using many different types of business models. So, it is important to understand which model is more beneficial and suits your requirements. Decide which of the models, namely B2B, B2C, B2B2C or a hybrid business model suits the unique business needs of your makeup and beauty products marketplace brand.
A clear understanding of the target market and the areas to be targeted later goes a long way in the success of your business. You may identify the areas to explore by conducting various surveys and market research. This kind of research provides specific info about your target market needs and helps to optimise your business process, define your competitor, and adopt the right market strategy. As your business scales to profit, your target market is likely to expand which is why you must track market preference and behaviour, to stay updated with your target market.
Finding a niche that resonates with customers is key to defining what type of beauty and makeup product to launch for your business. Being clean, natural, green and organic is not enough these days to differentiate your beauty business. Think about how your beauty products will resolve the issues and fulfil the needs of customers. Don’t be all things to all people. Try to be unique and focus on what makes your product different from other products and what kind of customers your unique selling point might attract.
Once your business idea and market research are complete, you have to think about the development approach where the features need to be implemented. There are four approaches to consider.
Open-source marketplace solutions allow you to develop your own portal even if you don’t know to code. You get various templates and plugins to build your makeup and beauty online marketplace.
Even though open-source solutions are cheap, usually they don't offer great functionality. For extra features, you have to reach out to the service provider and go with paid extensions. The cons are it lacks uniqueness and can become tricky to handle as your brand scales up.
Saas platform is a subscription-based ecommerce solution which offers different plans and features for different stages of a growing business. With battle-tested solutions for different use cases and inherent scalability and flexibility, SaaS-based marketplace builders are the most popular marketplace solutions.
They are fully developed products with the best features where it is easy to start working with just a registration and subscription. Saas platforms often give rich functionalities to get the maximum benefit from their platforms.
Building custom marketplace software from scratch requires lots of time, resources and planning. Since it is built from scratch, it can take months if you want any changes to cover. Even if you want to extend the product functionality with additional features the development process has to be started from scratch increasing the development time.
While the brand has complete control over the code, the time taken in launching the project is usually very long.
Choosing a customisable SaaS-based multi vendor marketplace platform could be a good option compared to the other two choices, i.e., building from scratch and open-source solutions. Before choosing the platform go for a free trial and find the details about pricing, scalability and growth.
Quick release: You can able to reach the market in the shortest time
Save time and money: The required concept can be developed in less time and price without any wastage
Automatic upgrades and updates free from the burden of maintaining and upgrading the software
Easy Integration: Saas eCommerce platforms are usually easier to integrate because they have powerful APIs that make integration easier
Scalability: Saas e-commerce platforms are inherently scalable and flexible and additional functionality can be added with new applications
Security: SaaS offers multi-level security and threat mitigation is also better with SaaS
There are various monetization strategies for multi vendor marketplaces. Monetization strategy refers to the process of earning money on a platform. Choose the right one that suits your business model.
Advertisements: Ads are the common way to monetize any online marketplace business. However, they are a great way to promote the products and get more visibility for your makeup and beauty products sellers and their products
Subscription: You can offer subscriptions and memberships to your customers and offer them special offers or free shipping etc. in turn
Paid promotions and premium listing: This allows the vendor to list their products on the website at prime locations which is directly visible to a potential customer
Commission: Commission is a per cent charged by a marketplace for each transaction
Selling services: Online marketplace brands can sell services to their sellers, like discounted shipping, features ads on the portal etc
Marketplace brands can strategise and implement even more revenue sources on their portal.
Now that we have decided on all the other aspects of the makeup and beauty online marketplace, it is time to make a detailed list of the features needed to run the business effortlessly and smoothly.
The features and modules should be so aligned and working in tandem that the customers, sellers and admin(s) all get the best user experience. The below features need to be integrated to beat the competition and success in the market.
Admin dashboard: Every multi vendor marketplace should have an admin panel that controls the end-to-end features and functionalities of the website. With an intuitive admin dashboard the owners and teams of the marketplace brand can ensure smooth functioning of the business, manage and monitor vendor activities and plan different marketing strategies
Vendor management: Complete control of all activities of the vendors along with their performance
Approval flow: Admin can check and approve or reject the makeup products uploaded on multi vendor marketplace by various sellers
Order management system: To manage orders and shipment of makeup products from different vendors
Discount Engine: Ease of setting discounts from various vendors, makeup product categories or order discounts
Taxes: Easily can set up taxes for various makeup products and their sellers
Payments: Payment gateway that supports various payment options such as COD, credit cards, debit cards and e-wallets
Returns and Refunds: Admin manages the return and refund of particular makeup products
Reports: Admin can get reports that offer sales figures, stock details to commission rates
Registration: A multi vendor marketplace platform should provide the opportunity to create a personal profile. For vendors, it is the first option to create an online store and start
Vendor dashboard: It helps the vendor to manage profile page information, images, logo, shipping places, own makeup products listings and personalised reports
Seller sub store: Unique storefront for sellers where they can display all their makeup products on the multi vendor marketplace
Store Locations: Physical location of seller stores. It helps the nearest store to get more orders
Product management: To easily manage beauty and makeup products orders, inventory etc
Shipping Management: To manage the shipping and choose the shipping partners and pick-ups and returns etc
Reports and Analytics: It gives the reports and analytics of the purchases
UI/UX design: Interactive user interface design to enhance customer's buying experience
Mobile Apps and Mobile Store: Ecommerce is mostly mobile commerce. Your beauty products online marketplace should have its own mobile apps and PWA stores to reach more customers and engage them better
Authorization and security: Users sign up by providing personal details such as name, phone number, email, and password. So, the registration process should be easy to handle. A secure platform is one such important feature that customers look for on your site for safe online shopping
OTP Login and Register: This allows customers to use their mobile number to login or register with their email id and access their profile on your online marketplace website
Quick Search: Easy navigation for fast product results
Product listing: Product listing displays all the list in a category manner so it makes customers choose the makeup products easily
Custom filters: Custom filters enable granular search of the desired makeup products
Unlimited Wishlist: This allows customers to add unlimited makeup products to the Wishlist which they can buy them later
Cart customization: It helps customers to edit their orders
Coupons and discounts: Show personalized discounts and gift coupons to the customers
Payment options: Multiple digital and offline payments for secured purchases
Rating/Reviews: We all know that this feature gives credibility to the products and the services too
GEO tracking: It enables tracking of the order and delivery personnel in real-time
Live chat and call: With this feature, customers can communicate and enquire about the order, makeup products and coupons
The right marketplace platform can be the key differentiator between a successful or a failed business. With stiff competition in the market, it becomes imperative for makeup and beauty products businesses to choose a marketplace solution that makes their business future ready.
StoreHippo offers cutting-edge, plug-and-play multivendor marketplace solutions for your makeup and beauty products brands looking forward to creating a niche. StoreHippo’s tested and easily customizable solutions enable brands to build tailor-made solutions for their unique needs.
Built on cutting-edge MACH architecture and SPA StoreHippo offers comprehensive vendor management solutions. With the pure headless commerce solutions at the core, StoreHippo enables makeup and cosmetics brands to build their unique online marketplace for a variety of business models like location-based multiple storefronts, B2B, B2C, D2C, hyperlocal eCommerce, etc.
With 300+ built-in features and 120+ integrations StoreHippo helps cosmetics brands experiment with different use cases and flows for their business. Built on a mobile-ready platform, StoreHippo offers a built-in mobile app builder and PWA stores for cosmetics marketplace brands.
StoreHippo’s gamut of built-in marketing tools and SEO-friendly platforms helps in promoting the beauty products multi vendor marketplace. StoreHippo’s global eCommerce solutions mean brands can build multilingual marketplaces for international buyers they can also localise it by using local payments and shipping solutions and by onboarding local vendors to give localized experience to their buyers. With 60+ payment gateways and 30+ logistics partners, StoreHippo makes it easy to streamline the online marketplace checkout and deliveries.
For brands looking to unlock new growth opportunities for their business, starting an online marketplace for makeup and beauty products is just the right business idea. With demand for quality products in domestic as well as global markets this business idea can pay rich dividends when executed well, powered by modern tech solutions.
Ready to explore the opportunities for your brand? Get ready to launch your makeup and beauty multi vendor marketplace website with StoreHippo. Explore StoreHippo’s unique multi vendor features, start your 14-day free trial now.