Hair by Bezos: Amazon steps up its assault on the beauty industry

The beauty vloggers of YouTube have a new obsession.

"I have a problem and…That problem, I think, might be an Amazon addiction," a sprightly Patricia Bright tells her 2.89m subscribers before introducing them to a niche French beauty brand that works "amazingly" on dry skin.

Bright is just one of a growing number of influencers ditching products from traditional retailers in favour of bargains offered on Jeff Bezos’ retail empire.

Today, the $1.6 trillion company has thousands of beauty brands listed, many offering exclusive deals on the site.

Amazon has also launched its own make up brands, Find and skincare line, Belei, sparking competition concerns in Europe over the “dual-role” the company plays in selling its own products in direct competition with third-party sellers.

But a retail offering isn’t enough. Amazon on Tuesday revealed it is stepping up its assault on the $500bn (£358bn) a year beauty industry by launching its own salon.

Based in east London, the Amazon salon will act as an "experiential venue" for visitors to try new technologies such as augmented reality hair consultations, where they can peer into "magic mirrors" and see what they'd look like with a different hair colour.

Point-and-learn technology will also use sensors to understand when a shopper is pointing at a product so it can display background information on a nearby screen.

Set over two floors and taking up more than 1,500 square feet, the Amazon salon will initially be available to Amazon staff only but will take bookings from the general public "in the coming weeks".

"We want this unique venue to bring us one step closer to customers, and it will be a place where we can collaborate with the industry and test new technologies," says John Boumphrey, UK country manager at Amazon.

What Amazon will do with this technology, which has been developed by a series of unnamed "partners", remains unclear. Analysts say the company is likely to either sell them onto retailers or embed them in its own business, with that latter prospect putting competitors on edge.

While the concept seems innovative, the technology Amazon is using isn’t new. Sephora has been "teaching" its consumers how to shop for beauty online using technologies like augmented reality (AR). Sephora customers have been able to try makeup on virtually, using the brand's app, for more than four years.

L'Oreal-backed Modiface operates an app that lets users virtually change their hair colour and Snapchat lets users try on makeup from brands including Estée Lauder using the app's filters.

L'Oreal Chief Digital Officer Lubomira Rochet, told The Telegraph last year, that when the company allowed online consumers to try on makeup or hair colour using AR technology, it saw the number of people making purchases triple.

“Amazon is a major driver of innovation but not in the way you might think,” says Victoria Woollaston, founder of tech and science-led beauty sites mamabella and MBman.

“When you look back at Amazon’s history of innovations, a significant proportion of them haven’t been its own innovations at all. Amazon has an eye for recognising rising trends and then acquiring businesses that have already put in the legwork.”

Such trends within the industry have been sped up thanks to the pandemic, according to Simeon Siegel, senior ecommerce analyst at BMO Capital Markets.

"Clearly the pandemic has accelerated e commerce's reach into beauty, given that there were no other options in the absence of stores," he says.

"With everyone on Zoom, cosmetics continued to be important, [just] the means of getting them shifted pretty dramatically."

Before coronavirus, in-store shopping accounted for up to 85pc of beauty product purchases.

But with major retailers wrestling with shuttered physical stores as well as shipping delays, consumers flocked to buy makeup online.

Amazon saw beauty sales rise 7pc in the US and according to retail analysis firm Mintel, 22pc of UK adults bought beauty products via the company in the last year.

Meanwhile McKinsey reported that Boots saw its overall sales drop by two-thirds during 2020's first lockdown, with beauty revenues contributing to the plunge.

But will retail stores bounce back once lockdowns lift? Whether beauty is "Amazon-proof" is the "burning question for our industry", says Elizabeth Kopelman, founder of consultancy Frisson Beauty.

Purchasing products, like make-up, has long been a sensory experience that consumers can only carry out in-store, where they can see how colours and textures sit against their skin, under natural light.

Woollaston believes the physical experience is here to stay. “Covid has also shown that digital services can only get you so far,” she says. “The need for such skills and talents will always be in demand. What the beauty industry needs to do to stay relevant, however, is to embrace innovations alongside these traditional techniques.

“I don’t see VR and AR competing against bricks and mortar beauty sales, I see them being highly complementary. All it needed was a major retailer to make these innovations more accessible; to show what’s possible and that’s what the Amazon salon promises to do.”

Some may not see it that way. The Amazon salon is being regarded as a challenge to the beauty industry at a key time, as Covid-19 restrictions lift and stores reopen.

Kopelman of Frisson Beauty says the company's salon presents a threat but also an opportunity for brands to adopt a model that is growing in popularity in other parts of the world, such as Asia.

"Click and mortar [is] where you have these really immersive, tech-enabled brand experiences in brick and mortar that become a seamless shopping experience for the consumer," she says.

The Jeff Bezos empire has demonstrated its ability to drastically change the standards consumers expect from delivery times and the ease of online shopping.

At worst, beauty brands that fail to adapt the "Amazon-effect" risk following the path of the brick-and-mortar bookshops that were unable to offer customers a reason to keep coming.

Whatever's next, Kopelman says, "Amazon is certainly here to stay".

Would you get your hair cut in Amazon's hair salon? Tell us in the comments section below