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L2′s 2012 Digital IQ Index®: Beauty

By L2 | 31 October 2012

Today marks the release of the fourth annual Digital IQ Index®: Beauty. This year’s study benchmarks the digital competence of 56 prestige Beauty brands across four dimensions: site, digital marketing, social media, and mobile. Based upon more than 900 data points, brands are classified into five categories: Genius, Gifted, Average, Challenged, or Feeble.

This year Estée Lauder and Lancôme share the number one ranking and are the only two Geniuses in the Index. Both brands lead the industry with innovative digital influencer partnerships, savvy online marketing, and best-in-class websites featuring real time customer service. Clinique, L’Oréal Paris, and M.A.C. Cosmetics capture the remaining top five spots as Gifted brands.

For a full top 10 list, please see the chart below:

The study finds that the retail landscape of the beauty industry is rapidly shifting online. Both department store sales, historically the backbone of prestige beauty, and drugstore sales, the home of mass brands, are on the decline. In contrast, online sales across the health and beauty category were up 29% year over year in the first quarter. Nearly half the brands in this year’s Index also register Amazon as a top source of downstream traffic from their sites, up 36% from a year ago. Although only three prestige brands appear to be officially selling on Amazon, the disruptive retailer is already purchasing against 46 percent of prestige brand terms on Google, suggesting that the beauty industry could be its next target.

Among brands’ own e-commerce pages, we also found that competition is evident across the industry. 75% of brands in the study now incorporate user reviews, 39% support auto-replenish sites, and 18% promote loyalty programs on their sites. Among the 15 brands (primarily mass) whose e-commerce strategy still relies primarily on online retail partners, 27% have invested in tighter shopping cart integration over the past year.

For more information on the Digital IQ Index®: Beauty, download an excerpt of the report here and watch the video below:


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