Here’s what to expect to see in the beauty industry in 2024

Last year was a dynamic one for the beauty industry, and this year, a lot of trends will likely continue to evolve from the groundwork laid in 2023. So while we’d never be able to anticipate which beauty products will go viral on TikTok or which celebrity will attempt to launch their own brand, there are a few things that beauty experts are a bit more certain about for the year ahead.

Effective immediately: The quiet luxury trend took over TikTok last year, thanks in part to the chic looks Sofia Richie donned at her much-buzzed-about wedding and the simple but expensive stylings on HBO’s Succession. While stemming from the fashion world, that trend will make its way into beauty in 2024, Clare Hennigan, senior beauty analyst at Mintel, told Retail Brew.

Not only does this mean more minimalist packaging and design, but clear communication about product efficacy. Consumers will seek out more clear info from brands on the active ingredients in products and what exactly they do, backed by scientific evidence, Mintel predicted.

• Emphasis on these luxury in tandem with efficacy will help brands with higher price points stand out among the proliferation of dupes, Hennigan said.

“It speaks to overall consumer desire for high-quality goods,” she said. “Consumers are being a bit more discerning with their budgets, particularly given these cost of living prices.”

Within the wellness subcategory, Mintel predicts that the concept of mental state impacting physical beauty will influence the types of products consumers are looking for as they turn to practices like psychodermatology and neurocosmetics. This will give rise to products for stress relief or supplements targeting specific health concerns. Beauty brands and retailers will also likely partner with mental health experts, Hennigan said, as well as other “individuals across different disciplines as a way to help better serve the consumer’s needs holistically.”

Eyes on AI: Beauty brands will also lean further in AI, but first need to ensure consumers feel “that their data is safe and cared for,” she noted. Use of AI could come in the form of creating ad campaigns, generating product concepts, and improving the quality control process to catch things that the human eye and product testing might miss.

At beauty retail, this could also mean more in-store experiences like smart mirrors and on-demand personalization. Per Mintel, 28% of US consumers are interested in trying (and possibly paying more for) hyper-personalized beauty products, and these in-store applications could also play into consumer demand for more experiential retail experiences, Hennigan noted.

Deal with it: M&A could be looking up in 2024. Last year was a more “challenging financing environment,” leading companies to be “risk-off” and transactions to be down, noted Sasha Radic, managing director of the consumer investment banking division for Jefferies and who leads its beauty and wellness practice. Still, the deals that were struck were “very well-received,” with high valuations, she noted, including L’Oréal’s purchase of Aesop and E.l.f’s Naturium acquisition. Transactional activity will likely continue within wallet-friendly mass and masstige brands along with luxury and “ultra prestige” brands, she predicted.

“There’s a lot of opportunity for brands that are really establishing themselves with their price point,” Radic said. “And there just hasn’t been a lot in the middle.”

Radic predicted that next year, investors will zero in on “recession-resilient” products tailored to recurring purchases. Compared to other categories, earnings have largely been strong in the beauty space, Radic noted, and private-equity firms are well capitalized, so it could be a stronger year for deals.

“​Going into next year…I’m optimistic for a more robust M&A market,” she said.