In a presentation by Listrak, Jamie Elden, chief revenue officer, gave an overview of the beauty retail landscape for 2025 and a look into the future at the WWD Beauty Inc Catalysts event.
As the beauty and wellness space has expanded, e-commerce has seen a massive boom alongside it. “In the U.S., e-commerce revenue in the beauty sector is expected to deliver about $90 billion of revenue. Globally, it’s nearly a $700 billion market — and growing,” said Elden, highlighting Listrak’s annual survey based on the insights and consumer data of its partner brands, with more than $2.75 billion in e-commerce sales for beauty and wellness.
Within that, Generation Alpha is key. “Generation Alpha are the fastest growing spender within [the beauty] category — accounting for nearly 40 percent of sales in skin care — and it’s only going to increase.”
Notably, the luxury fragrance sector is also seeing massive consumer spending, with the average purchase price of a bottle being more than $200 — and growth for the fourth quarter of 2025 seeing an increase of 14 to 17 percent.
This year, the major concerns in the beauty and wellness landscape were the rising costs and tariffs, supply chain delays, tighter spending, dupes, artificial intelligence replacing roles and TikTok. Meanwhile, many brands focused on continued growth, AI-driven campaigns, cross-channel orchestration, growing into new markets and personalization at scale.
“We’ve seen a huge surge in our client base globally entering into new markets,” explained Elden. “New domains and testing out in new markets in [Middle East and North Africa], emerging markets in Europe, [Asia-Pacific] and [Latin America]. We’ve seen surges of brands testing there this year.”
Looking ahead at what’s been dominating strategies in the beauty commerce space, it’s AI tools providing brands with search, on-site personalization, automation and domain expansion.
“[Brands] are adopting AI and trying it out for the first time,” said Elden. “Whether that’s a small direct-to-consumer brand who’s doing $5 million in year up to the large holding companies who are doing billions of dollars a year. It’s new and they’re testing it out. They can make search more relevant to that customer who frequently comes to the website.”
Listrak also shared what’s new for the beauty space going into 2026: metabolic and wellness beauty for inside and out, youth skin care becoming the fastest growing demographic and category, men’s personal care, skin and luxury fragrance, retailers growing their beauty presence such as Gap’s new beauty line and AI for beauty routines with AI models driving sales on social media and emerging marketplaces.
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