Boutique retailing on the rise thanks to cult-like followings

By Lucy Whitehouse

- Last updated on GMT

Boutique retailing on the rise thanks to cult-like followings

Related tags Retailing

Boutique beauty retailing are on a high-growth trajectory, according to market research firm Kline, with hundreds of new door openings seen across 2015 - 2016.

The firm pins this on the devoted followings they can inspire among their consumer base, thanks to their offering of  “unique concepts, a fun environment, and highly knowledgeable staff”​.

It is almost like a cult, the followership is often buying into the exciting concepts of these stores virtually more than the products themselves,​” explains Kelly Alexandre, analyst with the firm.

Look and feel: a physical edge over digital

While ecommerce certainly remains an ever-dominant retail channel, boutique retailing is also seeing mounting popularity as consumers look to engage with their products in a physical way.

According to Kline, which is launching a report series into the channel, vertically-integrated specialty stores that offer an immersive, single brand experience are particularly favoured by younger generations, including millennials.

Boutique retailers offer a fun and interactive environment that isn’t found in other channels, which is appealing to younger, digital consumers,​” Ewa Grigar, a fellow analyst, confirms. It is becoming a trend shaping the market on a global scale.

How to dominate in this space

Staying ahead of competitors with innovative offerings as the number of beauty boutiques begins to rocket will be essential.
The success of such stores depends on whether brands can keep up with the pace of younger consumers’ digital needs, as well as keep a store’s levels of innovation and engagement high,​” Alexandre explains.

Currently, big and small brands alike are looking to maximise on this opportunity. Large multinationals are opening their first boutiques, led by L’Oréal’s recently-acquired NYX cosmetics, which has expanded its presence from one store to 20 in a single year.

Beauty brands use this as part of an omni-channel strategy, as it offers numerous brand-building opportunities,”​ Kline explains, but cautions that the channel requires almost continuous input in terms of innovation and marketing activity.

Companies that cannot maintain a high level of innovation, keep up with the essential amount of interactivity and overall exciting experience are doomed to lower engagement and sales,”​ confirms Grigar.

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