The insight: Walmart and Amazon are strengthening their hold on the beauty market. The two retailers dominate purchase intent clicks for the beauty and personal care category with 45.9% and 32.88%, respectively, according to our Industry KPIs data provided by MikMak.

Why it matters: Amazon and Walmart are growing their shares of the beauty market thanks to a variety of tactics, including expanding their selections of premium brands and holding beauty-specific sales events.

Amazon in particular is winning over shoppers: The company is expected to overtake Walmart as the top beauty retailer in the US by 2025, with 14.5% market share to the latter’s 13%, according to Morgan Stanley.

• Its efforts to woo upscale brands like L’Oréal, Clinique, and Kiehl’s to its platform are helping it narrow the gap with specialty retailers like Ulta and Sephora.
• Amazon’s prestige makeup offerings have a 16% brand overlap with Ulta, and 9% with Sephora, per Jefferies’ estimates cited by Women’s Wear Daily.
• Nearly 3 in 5 (57%) of premium beauty customers are somewhat or very likely to purchase premium beauty or personal care brands from Amazon, per CivicScience—although they prefer to shop from official brand storefronts rather than from third-party sellers on its marketplace.

But Walmart isn’t sitting idly by.

• The retailer now offers a much wider selection of brands online thanks to its marketplace expansion efforts, and is using its accelerator program to incubate exclusive brands to grow its reputation as a beauty destination.
• Rather than selling the same selection of brands as Sephora, Amazon, and Ulta, Walmart’s premium beauty strategy relies on having a wide range of products across price points, allowing it to appeal to both the growing numbers of high-income consumers who shop at its stores as well as its core customer base.

Our take: While stores remain the primary avenue for beauty spending and product discovery, consumers are shifting more of their spending to retailers like Amazon and Walmart that can not only deliver the items they’re looking for, but also do so quickly and conveniently.

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