• by Sarah Mahoney , May 27, 2009

While sales of higher-end beauty products have been struggling in most retail channels, a new report from the NPD Group finds that at this point, beauty sales are growing on the Internet.

While the gain is small -- just 1% -- the Port Washington, N.Y.-based market research firm says it is the only channel where beauty purchases are growing, in terms of the number of women reporting mentions for beauty products.

The Internet -- while still a comparatively small channel for beauty, which has historically been something of an impulse category -- "also has a higher ratio of women saying they spent more, relative to those who said they spent less on beauty in the past year." On average, these women spend $86 annually on Internet beauty purchases.

What's more, this group of women is emphatically trading up at a time when many consumers are switching from department store brands to lower-end lines. In the NPD survey, online beauty buyers say they are buying more beauty products in general, and that they have begun stocking up on more expensive brands and products than in the previous year.

NPD attributes the change to convenience, product availability, and higher gas prices.

As in other categories, consumers are using the Internet more for researching beauty products, even when they don't make an online purchase. "About two in three Internet shoppers who shopped for beauty online, but did not make a purchase, said they use the Internet to gather information and make price comparisons."

That means there are still plenty of opportunities for sites that can determine the best way to convert those browsers to buyers.

"Consumers are clearly showing us that they value this avenue for beauty. The Internet crosses all channels from traditional brick-and-mortar stores, to TV, to direct sellers. There is still room for more Internet shoppers to buy through Web sites, instead of going somewhere else to make the actual purchases."