The beauty industry has recently experienced a surge in prices, with drugstore beauty brands being no exception. Between March 2022 and March 2023, cosmetics prices rose by 4.2% and personal care prices grew 8.7%, according to the U.S. Consumer Price Index. This increase in prices has led to widespread discussions on social media platforms like TikTok and Reddit, where users express their shock at the rising costs of once-affordable products.
One notable example is Olay’s new SPF 30 mineral sunscreen for sensitive skin, which was reportedly found to retail for $49.99 in stores. Houston-based dermatologist Andrea Suarez shared her disbelief in a recent TikTok post, stating, “OMG $50 is insane.” The video quickly gained traction, with many users echoing Suarez’s sentiments and expressing their frustration with the escalating prices of drugstore beauty products.
@drdrayzday Would you pay $50 for a #drugstore #mineralsunscreen #spf30 ?? Olay is reaching here with that price! #drdrayzday ♬ original sound – Dr Dray
Experts attribute these price hikes to various factors, including inflation, rising costs of shipping and raw materials, and the premiumization of drugstore beauty brands. Inflation, in particular, has a significant impact on consumer spending habits, as unevenly rising prices reduce the purchasing power of consumers, leading to an erosion of real income.
Some brands, like The Ordinary, have chosen to be transparent about their price increases, announcing an average price hike of $1.12 per item in 2023. However, the case of Olay’s sunscreen seems to be more complex. However, the official manufacturer’s suggested retail price for the product is $29.99 (MRSP), but pricing is ultimately at the discretion of the retailer to price at or above this recommended price. The sunscreen is listed at $24.99 on Olay’s direct-to-consumer site, although it is currently unavailable for purchase. This means that the retailer, who has been identified as Walgreens, is the ultimate culprit for the 100% price hike from $24.99 to 49.99, not Olay.
As consumers become more aware of the rising costs of beauty products, thanks in part to beauty influencers and online discussions, the demand for affordable alternatives is likely to grow. In response, drugstore brands may need to reassess their pricing strategies and find ways to maintain their appeal to price-conscious consumers while navigating the challenges posed by inflation and other market forces.
Jeanel has 15 years of retail, marketing and brand management experience. She has started an ecommerce business in 2019, after working in corporate retail and real estate as a senior managing director and former consultant. She's traveled all over the world, speaks at world renowned trade shows and events, holds a Bachelor’s of Commerce (B.Comm) and a Certificate in Commercial Real Estate. You can connect with her on Linkedin.