Keating, the chief customer officer of leading beauty incubator Maesa, to discuss the top trends beauty retailers should tap into in the year ahead. Keating warned that beauty executives must remain agile to keep up in this increasingly competitive market. This includes diversifying product formulations to keep up with consumer preferences, such as clinically-centered formulations, and integrating technologies such as artificial intelligence (AI) to stay ahead of the curve.  Inside Retail: What do you believe are the biggest trends we can expect to see come out from the beauty retail industry in 2025?  Erin Keating: As beauty retail continues to evolve, it’s quick to address consumer behaviour.  With that, we will continue to see some key trends play out in the beauty space in 2025, including: Category-agnostic lifestyle brands We’ve already been seeing indications of blurring of the categories in and outside of traditional beauty, with brands taking inspiration from food, beverage, pet and other categories. As we go into 2025 and beyond, there will be an uptick of both mass and prestige brands successfully combining multiple categories to give their product offerings more depth, paving the way with a lifestyle approach.  Hyper science beauty In 2025 and beyond, we’ll continue to see a shift from “clean” to “clean-incal” across all beauty channels led by skin care.  Being “clean” is no longer enough and consumers are showing a heightened demand for science-led products, unbiased clinical results and potent ingredients.​​ Across beauty and personal care, we see desire for proven claims, performance, long-lasting results that offer consumers optimal value from their product, led by skincare but influencing all categories [across the beauty industry]. Personalisation Gen Z and Alpha crave a higher level of uniqueness from products that feel made for them and brands they see themselves in, driving the explosion of niche and indie across beauty categories.​  As the beauty industry continues to evolve, personalisation becomes more about creating a sense of belonging and connection to brands, ensuring that consumers feel understood.​ This evolution is driven by the latest in digital engagement and AI technology, including immersive and inclusive experiences. IR: What are some consumer-specific trends beauty retailers should tap into in 2025? And how should retailers take these trends into consideration? EK: Despite being the smallest category in beauty, fragrance posted the highest growth of any beauty category in 2023. Fragrance will continue to explode across beauty and personal care segments, whether it’s in your everyday personal care items or specialty bath and body products.  Niche fragrances are expected to be among the biggest drivers of growth within this category, and craftsmanship and ingredients are set to play an important role in brands’ positioning and storytelling.  Seasonality and virality of trends are going to play critical roles across both big and small brands. It’s important for retailers to stay attuned to these trends, building in flexibility to be able to capitalise on these moments. The speed at which the retailers notice, acknowledge and react to the trends will be key to success in 2025.  IR: What do you think are the biggest challenges facing beauty retailers in 2025? Please elaborate. EK: Agility has always played an important role; however, it will become one of the biggest challenges the retailers will have to solve in 2025 and beyond.  With the level of virality and growth in digital sales we’re observing within the beauty industry, ensuring you’re reacting quickly from both an engagement and execution standpoint will be key to success. From identifying those trends to getting the products into the hands of consumers to capitalising on these moments from a marketing perspective, speed to market is going to be a critical success factor. IR: Following up on the previous question. How should beauty retailers and brand owners navigate these challenges? EK: When it comes to agility, there’s no specific roadmap, it all comes down to retailers’ and brands’ flexibility to explore different tactics.  In 2025, it will be essential to lean into experimentation when it comes to consumer behaviour. Taking the scientific approach to what consumer behaviour will look like, and then calibrating tactics will be an integral driver of strong performance. While not everything will work, business as usual will not be the key to success. To capitalise on these growth opportunities, brands and retailers alike need to leverage the latest technology and tools, including AI. IR: What new or emerging technologies are you excited about at the moment? How should beauty retailers integrate this tech into operations in 2025? EK: Within the industry, it’s essential for us to be experimenting with the AI space to improve agility.  From the operations/execution side, it could start with forecasting. From the marketing side, it could continue with digital and social listening.  It’s important to note that the adoption of AI technology won’t happen overnight, it’s a gradual, ever-evolving process and we need to test and learn now. [For example] at Maesa, we’ve been experimenting with AI in the marketing space for Fine’ry, our fragrance brand, creating content and phygital experiences that propelled brand awareness and overall sales performance over the past few months. We plan to take a deeper dive and hone in on our adaptation of AI space as technology continues to evolve. IR: As we close out 2024 and dive straight into 2025, what is your biggest piece of advice for more established and novice beauty retailers alike? EK: My advice for beauty retailers would be to start planning for the future now knowing that you won’t get there tomorrow. It’s important to see your business through the lens of consumers, where they are going to be and how they are going to shop in 2-3 years. With that, it’s essential to ensure that your strategy and messaging that you’re consistently landing with them will still be relevant.  This is why it’s incredibly important to invest in agility, expand your capabilities, and capitalise on technology today.