Economic pressures shape holiday spending: What beauty brands need to know



Holiday sales growth for 2024 is expected to drop 1.7%, down from 4.7% last year, said Stern. Such declines are partly attributed to ongoing household spending pressures and “a shorter shopping season with fewer days between Thanksgiving and Christmas”, she highlighted a resilient labor market and anticipated interest rate cuts that “support consumer confidence levels.”

This slowdown has significant implications for the cosmetics and personal care industry, which depends on holiday spending to drive sales. Stern shared her insights with CosmeticsDesign into how beauty manufacturers, suppliers, and brands can navigate shifting consumer behaviors and align strategies with value-driven trends to remain competitive during the 2024 holiday season. 

Value perception takes centerstage

Economic pressures are compelling consumers to prioritize value overindulgence. “This season shows an incremental slowdown in holiday spending trends as consumers increasingly focus on value amid easing yet persistent inflationary pressures,” Stern said.

She further explained that “value perception will separate retailers” this year, with thriving businesses leveraging “smart pricing and advertising strategies” to appeal to cautious shoppers. Big-box and off-price retailers are expected to benefit from this trend, capturing the attention of consumers looking to stretch their dollars.

Cosmetics and personal care brands may need to collaborate with such retailers or emphasize their affordability in their product lines and marketing.

Higher-income consumers, however, present a nuanced opportunity. “Despite economic concerns, higher-income consumers are likely to spend but with a more selective approach,” Stern observed. She emphasized that this group will remain attentive to promotions, creating openings for brands to highlight quality and value.



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