Consumers haven’t stopped spending on beauty. They’ve become much more discerning about which products have earned the right to command a premium.
The beauty consumer is difficult to define by a single price point. She may invest heavily in a clinically backed serum or a fragrance she loves, while buying her cleanser, mascara or body wash at mass. Circana describes consumers as shopping across price tiers and selectively investing in the products that deliver the greatest emotional or functional value—a behavior helping beauty remain remarkably resilient despite continued economic pressure.
That makes “trading down” too simplistic a description of what is happening. Consumers are trading up and down within the same routine. Fragrance offers an interesting example: prestige consumers continue to spend on luxury and higher-concentration formats, while lower-priced minis and discovery formats are also growing. Elsewhere, value-driven alternatives and dupes continue to gain attention. The common denominator is not price. It is whether the consumer believes the product is worth it.
For brands, that raises a more important question than What is our price?: What are we giving the consumer permission to spend more on? It may be visible efficacy, meaningful innovation, emotional desirability, extraordinary sensoriality, convenience or an experience that simply cannot be replicated elsewhere. The pressure is greatest on products sitting somewhere in the middle—neither clearly accessible nor meaningfully differentiated. In today’s market, premium pricing increasingly has to come with a premium reason.
Our KSJC POV
The consumer is not abandoning premium beauty—she is becoming far more selective about what deserves the premium. Brands that can clearly communicate why they are worth the trade-up will continue to win.
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