Most professional skin care outlets in the United States have been closed since mid-March due to the coronavirus pandemic, with no clear indication of when reopenings will occur. In fact, COVID-19 may mark a permanent closure for many of these outlets, particularly in the spa channel. For aesthetic physicians, tele–dermatology and taking out a small business loan to stay afloat will hopefully preserve businesses.
Previously forecast to grow at a CAGR of 6.1% through 2024, the U.S. professional skin care market has revised its forecast for the $2.8 billion market due to the unfolding developments. New forecasts, published by Kline in a special report on the topic, indicate a decline of 9% in 2020 as the most–likely outcome, with the best-case scenario reflecting flat sales growth and the worst-case scenario at a 15% drop. Given the current state of the pandemic, with lockdowns now inching closer toward summer months, our current worst-case scenario may, in fact, become the most-likely scenario.
The golden goose for the market during this crisis will undoubtedly be digital platforms, including Instagram, Instagram Live, and e-commerce, which should help cushion setbacks for medical care providers and retail channels. Marketers that have prioritized their online distribution through their own websites or e-retailers such as Dermstore and Amazon will undoubtedly see a payoff.
Medical care providers are projected to experience declines, but perhaps their digital efforts, many of which were already in place pre-crisis, will help soften the fall. Additionally, many doctors have moved to a telemedicine model. Aesthetic derms, many of whom also treat more serious skin ailments, are shining brightly with free advice and live streaming chats discussing treatments for stress-induced conditions such as rosacea, eczema, and shingles.
By engaging consumers via YouTube, Instagram, and Zoom, an entire new layer of tele-aesthetics has emerged to educate current and would-be consumers. Brands that have partnered with dermatologist influencers, such as Alastin, will benefit from having such initiatives in place. Allure magazine has introduced its House Call series, featuring New York City-based dermatologists dispensing advice on how to cope with skin care conditions during this trying time.
Spas, which will be hit the hardest during the pandemic, have made small initiatives to promote curbside pickup of take-home products. Some of these outlets are reaching out to their clients with DIY facials using products that are for sale. It’s questionable what percentage of the thousands of spas in existence will be able to re-open and when.
Kline’s scenario forecasts were generated using expert judgement, based on a thorough review of channel performance through the previous recessionary period along with what is currently known about the unfolding pandemic and economic situation. Detailed scenario forecasts and commentary are provided for medical care providers, spas and salons, and the retail sale channel in Kline’s Impact of COVID-19 on the Professional Skin Care Market report.