Club benefits: Beauty membership vital to foster long-term relationships with e-commerce shoppers

Online shopping festivals across the SEA calendar such as 11.11 or 12.12 on e-commerce marketplaces such as Lazada and Shopee have created unprecedented sales opportunities for beauty businesses in the past years.

These mega sales events have evolved significantly since their inception, especially in the last three years.

“The mega campaign landscape in SEA has seen significant development since 2021, shifting from three major annual sales mainly in the latter half of the year to a more nuanced structure. This includes mega events like 9.9, 11.11, and 12.12, mid-tier campaigns such as 6.6 and 3.3, and ongoing double-digit promotions,”​ said Richa Bagri, regional head commercial, at Intrepid; a digital commerce solutions partner from Singapore.

In response to growing competition and changing consumer demands, beauty brands are revising their promotional tactics for major sales events, said Bagri.

For instance, customer loyalty programmes are coming into play, with brands offering special deals and incentives, which also foster long-term relationship with consumer.

According to Bagri, mega sales periods have seen an uptick in sign-ups by of beauty club memberships, attracted by exclusive offerings and special deals.

“Brands and platforms highlight exclusive deals during major campaigns to encourage memberships, aiming to boost immediate purchases from current members and long-term engagement due to increased new sign-ups driven by high traffic on mega days,” ​said Bagri.

In recent years, more beauty brands have set up memberships that include e-commerce platforms in attempt to create seamless shopping experiences for consumers.

Furthermore, e-commerce players have debuted their own membership programmes.

“Both brand-specific memberships and platform-specific beauty memberships, like Shopee's Beautyholics and Lazada's LazBeauty, play a role. Smaller brands tend to benefit from the promotional tiering offered by beauty clubs on these platforms, which allows for stacking deals. Larger brands find that their own membership programs are just as effective and has broader goals,” ​said Bagri.

Festival fatigue​

The need to use memberships to attract consumers comes with the saturation of mega sales events that seem to happen almost monthly, leading to consumer fatigue.

“There is a noticeable sense of consumer fatigue in general. The excitement that once accompanied the wait for special shopping dates is fading, as discounts and deals have become almost routine. However, this sense of fatigue is more noticeable in the behaviour of repeat shoppers rather than new buyers,”​ said Bagri.

Once characterised by heavy discounts, Bagri noted that engaging in price slashing was not a viable long-term strategy for brands.

“The sustainability of discounts and promotions is a critical issue in the e-commerce sector. While consumers eagerly anticipate major sales events to secure the best deals, often delaying purchases to do so, there is a growing realisation among brands and marketplaces about the need to preserve profit margins.​

“​The challenge lies in striking an optimal balance between stimulating demand and sales through enticing offers and maintaining healthy business profitability. The strategy has evolved from broad, storewide discounts to more sophisticated campaign strategies.”​

For beauty, it is also imperative for brands to highlight product features such as ingredients, clinical or real customer results to further encourage check-outs.

Marketing efforts are increasingly focused on addressing specific beauty concerns, like pigmentation or ageing, to drive conversion rates.

Moving forward, mega shopping events will continue to be an important fixture on the calendar.

“In the coming years, mega sales events are expected to evolve, focusing on driving quality traffic to achieve higher returns, as evidenced by an approximately two to three percentage point increase in conversion rates across various marketplaces in 2023. Brands emerging stronger are those that have strategically focused on customer acquisition throughout the year,” ​said Bagri.

“Future mega sales will continue to drive similar growth as the ecosystem strives to deliver differentiated value to consumers. Key strategies will include leveraging ‘shoppertainment’, offering exclusive and tailored product and promotion strategies per channel, enhancing discoverability through optimised media spending, and employing AI and data analytics for effective cross-selling and upselling.”​