Physical Stores Struggle in the Face of Digital Disruptors

Consumer shopping habits are changing in the Middle East


Retail disruptors are on the rise.

Dominant beauty incumbents and physical stores are being increasingly challenged by the disruptive force of new startups and global social media platforms. A review of statistics collated by startup facilitator Virtuzone shows that beauty tech, artificial intelligence (AI) and e-commerce are booming within the industry; and this is reflected in the market, as new brands direct their energy towards these areas.

The result is a dramatic shift in the way consumers browse, choose, purchase, use and review beauty products. In the UAE, spend by consumers on personal care and beauty products in 2018, was estimated by Euromonitor International at US $13.9billion. Fragrance, skin care, men’s grooming, colour cosmetics and hair care were the five most popular categories in terms of spend. The value of the market, along with its continued growth, has made the Middle East a viable investment for industry startups in recent years. The most successful startups in the region are those which have embraced a combination of innovative technology and social media influencer marketing.

There are a few businesses disrupting the way in which consumers shop in the Middle East. These brands are using technology and social media trends to shape customer perspectives. In a market that values convenience above all else, conventional beauty brands that resist these changes risk losing their previously stable place in the market.

Online beauty retailer Powder is one such brand. What founders Ayat Toufeeq and Amina Grimen have created with Powder goes beyond retail, it’s a community where likeminded beauty and skincare aficionados can review and recommend products, look at ingredient lists and find out about the latest product launches.

Combining convenience and expertise, the new Instaglam Beauty iOs mobile app enables customers to choose from a variety of skilled professionals anywhere in the UAE. Founder Haifa Addas brings luxury marketing experience from some of the most well-known global brands such as L’Oréal, Lancôme, Ralph Lauren, Giorgio Armani and Helena Rubinstein. She points out that beauty is traditionally played out within the home environment among Middle Eastern women and therefore it follows that an on-demand service would be preferable to a salon experience.

Like all other successful disruptors in the region, both companies offer a more personal experience and enhance consumer choice.

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