What: Major US department stores are redesigning beauty floors and investing in interactive services as TikTok, Amazon, and specialty retailers reshape the beauty market.

Why it is important: Department stores’ investments in beauty reflect broader industry trends, where experiential retail and exclusive services are key to regaining market share from online and specialty competitors.

US department stores are responding to the disruption caused by social media, e-commerce, and specialty beauty retailers by transforming their beauty departments into immersive, technology-driven destinations. Macy’s and Nordstrom have revamped flagship beauty floors, introducing luxury brands, interactive technology, and exclusive services such as robot-applied treatments and virtual reality fragrance experiences. These innovations are designed to create a compelling in-store environment that can compete with the convenience and inspiration offered by digital platforms like TikTok and Amazon, which now dominate beauty discovery and sales. Despite these efforts, department stores continue to face declining market share as consumers increasingly turn to influencers, AI-powered recommendations, and specialty chains for beauty advice and purchases. The challenge for department stores is to blend the best of physical and digital retail, using experiential concepts and personalised services to attract shoppers and rebuild their authority in the beauty sector. Success in this area is becoming a critical differentiator as the competitive landscape intensifies and consumer expectations evolve.

IADS Notes: Department stores in the US are intensifying their efforts to reclaim relevance in the beauty sector by investing in experiential retail and advanced technology, as highlighted by WWD (October 2025). Macy’s and Nordstrom have renovated flagship beauty floors, introducing interactive features, luxury brands, and immersive experiences to differentiate from e-commerce and specialty competitors. However, Retail Dive (September 2025) and BoF (August 2025) note that the rise of TikTok, Amazon, and AI-powered shopping tools is fundamentally altering how consumers discover and purchase beauty products, eroding department stores’ traditional authority. The shift from in-person advice to influencer and algorithm-driven recommendations has resulted in declining market share for department stores, with digital-first platforms and social commerce gaining ground. NRF (November 2025) reports that department stores are targeting higher-spending customers with redesigned beauty departments and exclusive services, aiming to boost foot traffic and sales during the crucial holiday season. Meanwhile, Euromonitor (December 2025) underscores the intensifying competition, as specialty chains, mass retailers, and social commerce platforms continue to capture share from traditional department stores, forcing them to innovate rapidly to remain competitive.

Department stores fight TikTok and Amazon for beauty shoppers