NEW YORK — It’s shoppers like Quinn Kelsey who keep department store executives up at night.
The 38-year-old Denver resident gets makeup ideas from TikTok videos and other social media content, not salespeople at beauty counters. She uses an AI chatbot to get product recommendations that fit her budget and to see how a certain foundation or lipstick would look on her. When she buys, it’s usually from Amazon.
“I use Chat GPT as my personal beauty consultant,” Kelsey said. “Department stores? I’ll walk through one for the decor, but they’ve basically lost me unless I can get the same product-research experience there that I can get scrolling through my phone at home.”
Once the ultimate beauty destination, department stores lost sales and their authority as skincare and makeup trendsetters starting in the late 1990s. That was when the growth of Sephora and Ulta Beauty made shopping for cosmetics more of a playful, self-service experience.
But fast-changing consumer preferences have all types of retailers racing to outdo each other for a slice of the $129 billion U.S. beauty and personal care market. The competition is fiercer than ever due to the ease of e-commerce. Amazon, which has slowly added premium beauty brands to its massive selection, is the nation’s largest online seller of beauty and personal care products, according to market research company Euromonitor International.
Social media also has provided new sources of beauty guidance. Instead of store advisers, many consumers look to videos by influencers, beauty brand founders or dermatologists for advice. Shoppers also turn to TikTok and Instagram for information about “dupes” — drugstore versions of more expensive products.
“Stores are more of the showroom, but the spark itself is happening in TikTok,” Jake Bjorseth, founder of the Generation Z advertising agency Trndsttrs, said.
To keep up, companies with both physical and online stores are investing in upgrades that are meant to give beauty fans like Kelsey an experience they can’t get anywhere else. Macy’s and Nordstrom, for example, renovated the beauty floors of their flagship New York stores to add more space, ultra-luxury brands and cutting-edge technology. At Nordstrom, customers can book an appointment to get robot-applied eyelash extensions for $170.
The makeovers were launched in time for the holiday shopping season, which accounts for about one-quarter of all U.S. “prestige” beauty sales, according to market research firm Circana.
Department stores chasing beauty sales are introducing some of the serve-yourself features of Sephora — Nordstrom put in a “beauty bar” with brightly lit mirrors where customers are allowed to take makeup from different counters — while trying to distinguish themselves from specialty and online rivals.
Executives from Macy’s and Nordstrom said the latest changes were designed to create an engaging atmosphere that encourages shoppers to stay longer and spend more. The overhaul at Macy’s Herald Square included comfortable seating and skin analysis devices that help make the case for lotions and potions costing hundreds of dollars.
In the Parfums de Marly section, customers sample scents while wearing a virtual reality headset meant to immerse them in an 18th century chateau the French fragrance maker cites as its inspiration.
“This is the future of beauty,” Nicolette Bosco, Macy’s vice president of beauty, said, referring to the interactive technology the department store considers central to offering shoppers an elevated experience.
The company expects to redesign the beauty departments of 40 more stores. The facelifts are intended to draw shoppers of all ages, Macy’s Inc. CEO Tony Spring said.
“We’re trying very hard to take the idea of a department store and make it intimate and friendly and convenient,” he said.
Since becoming chief executive of the department store’s parent company last year, Spring has focus