Cyber Monday is not only a popular e-commerce shopping day on the Monday after Thanksgiving in the US, but it was also announced that 2022’s campaign was the single largest retail sales day in US history with sales hitting a record USD11.3 billion - a 5.2% increase from 2021 according to Adobe Analytics. The same study also noted a significant rise in online discounting up from 2021 levels. With inflationary pressures top of mind for consumers heading into the holiday season, promotional campaigns are critical for companies, but aggressive discounting can cut into already thinning margins as well as dilute brand image. With Euromonitor International’s e-commerce tracking tool, Via, online data for stock keeping units (SKUs) can easily be analysed to identify trends in the market and provide key recommendations. This piece specifically examines anti-agers in the US to highlight:
- The frequency at which leading players promoted their products on Cyber Monday
- What was the average discount for SKUs of leading players?
- Which brands were the most aggressive with promotions?
Leading players continue to combat inflationary pressure
Inflationary pressures continue to rise in the US due to commodity prices, labour shortages and ongoing supply chains issues. According to Euromonitor International’s Voice of the Industry: Beauty and Personal Care survey (fielded October 2022), 48% of beauty and personal care industry professionals stated that their companies raised prices on some products and services, while 34% raised prices on all products and services.
However, in some categories there is optimism that inflation is reaching a peak due to tightening consumer spending. In the above chart, online median prices for anti-agers showed some stability in the 6-month period leading up to Cyber Monday. In the online sample monitored, prices for the entire range of 18,271 SKUs showed a -3.3% decline in median SKU price. However, prices of the leading four players (accounting for 51.9% of retail value sales in 2021) varied over the same period with the more expensive products of Estée Lauder and L’Oréal declining, while the portfolios of Procter & Gamble and Johnson & Johnson saw average SKU prices rise. This is expected, given that L’Oréal and Estée Lauder are reliant on beauty-focused luxury portfolios, which are expected to be negatively affected by consumers’ increasing price sensitivity. In contrast, Procter & Gamble and Unilever have wide portfolios spread across various both beauty-focused and personal care categories, with recent business activity centred around acquiring premium brands to increase competitiveness with premium players. Nonetheless, with pricing concerns always top of mind, Cyber Monday is a critical opportunity for players to build stronger relationships with consumers and fend off competition with the right balance of promotions.
Incidence of promotions and discounts increase significantly on Cyber Monday for leading players in anti-agers
Analysing the rate of promotional events provides an understanding of the number of SKUs that are labelled as on promotion by retailers compared to the total number of products available to purchase. Studying the previous Monday before Cyber Monday highlights how aggressive players and retailers are in promoting their products during one of the busiest shopping days of the year. In many cases, players and retailers start to intensify their promotions in the days leading up to Cyber Monday with the aim of attracting consumers before the big sales day.
The above sample shows that promotional incidence rates rose by nine percentage points from 21.2% the Monday before Cyber Monday to 30.2% on the latter. Of the leading four players within anti-agers, Johnson & Johnson’s SKUs saw the most aggressive increase over the week, due to promotions for brands such as Neostrata and Neutrogena. While Estée Lauder and L’Oréal saw similar promotional increases within the week compared to the average for the industry, Procter & Gamble’s SKUs saw a minimal increase in promotional incidence, based on the decision to maintain promotional frequency for the Olay brand across retailers.Analysing the average discount of products on promotion provides insights into how aggressive players chose to be with discounting their products. For the leading players, the average percentage discount of the four largest players in anti-agers in the US was 19.5%, with Estée Lauder promoting products offering the largest discounts with an average 22% off a pre-sale price of USD102 per SKU. Conversely, Proctor & Gamble and its retailing partners offered an average 18% discounts for anti-agers from pre-Cyber Monday. Players need to closely monitor their competitors’ average discounts to ensure their brands are not “over” discounted so that they can maintain manageable profits, given the multitude of challenges with inflationary cost-push and demand-pull drivers.
Smaller brands more aggressively promoted online for Cyber Monday
While leading players represent a large share of sales within anti-agers, it is important to take a wider look at how aggressive certain brands were in 2022 with their promotional strategies. Analysing brands with a minimum of 20 SKUs, Biopelle and Obagi showed the largest increase of SKUs on promotion on Cyber Monday compared to the previous Monday levels. While only 6% of Biopelle SKUs were labelled as on promotion the Monday before Cyber Monday, 96% of SKUs were on promotion for the big sales day, an increase of in 90 percentage points as indicated on the chart above. In addition to the large increase in promotional incidence, the pricing discounts were also significantly higher than the average for leading players - SKUs for Biopelle on average were 26.5% lower than the non-discounted price. Often brands will aggressively promote their products on special occasions to create a strong sense of urgency and reach new consumers with a more affordable price; this is an important strategy for competing with the leading brands of larger players with greater marketing resources.
While this article focuses solely on anti-agers in the US, learn more about how Via can support businesses and help them unlock key strategic and tactical insights with its standardised online product coverage across 80 countries, 1,500 online retailers, and 11 consumer goods industries.
Note: Sample based on SKU prices found in Euromonitor International’s e-commerce tracking tool Via with data extracted in November 2022. Please note that due to ongoing improvements to the AI-led product matching of SKUs to categories, players, and brands, data and SKU counts can be revised based on system updates. SKU counts used for the analysis include: median price sample of US anti-agers, June-November 2022 SKUs = 18,271. Cyber Monday promotional sample = 3,715 SKUs. Information extracted from the following e-commerce retailers: amazon, Asos, Birchbox, Bloomingdale's, Blue Mercury, Boohoo, Clinique, Costco, Credo Beauty, Dillard's, Estée Lauder, Feel Unique, Giant Eagle, Harris Teeter, H-E-B, iHerb, Kroger, Lancôme, Lookfantastic, Macy's, Meijer, Net-A-Porter, Pavilions, Rite Aid, Safeway, Saks Fifth Avenue, Sally Beauty, Sephora, Skinstore, Space NK, Target, TJ Maxx, Ulta, Walgreens, Walmart, Wegmans.