BeautyMatter Mentions First Insight | Dupes and Deals Drive Dollar Store Beauty Growth
“Dollar stores, which were once considered ‘fill-in’ shops for cheap basics, have become primary shopping destinations for millions of Americans—drawing in not just low-income households, but an increasing share of mid and higher-income consumers as well,” said Viki Zabala, CMO of First Insight Inc. “These shoppers are passing up on trips to Target, CVS and Walgreens, and instead opting to shop at dollar stores more often, spending more per trip and filling their baskets with categories that go beyond household essentials, like apparel and, increasingly, beauty.”
The economy could amplify the growth of value stores. “When prices go up, loyalty goes down—and what we’re seeing now is tariffs and inflation pushing consumers to prioritize affordability over anything else. This has put value retailers in a great position to win over consumers and increase their market share,” she said.
Brands See Opportunity
Despite hurdles, several beauty companies are leaning in.
“Social media made it aspirational to score the $5 version of a $25 product, and TikTok, specifically, is filled with videos of $10 or less lashes, skincare and full-face routines framed as ‘hacks’ and dupes rather than cheap substitutes,” said Zabala.
According to First Insight’s report, The Quiet Takeover of Private Label, the data confirms this cultural change. Forty-four (44%) of consumers say they’re more likely to try store brands when marketed as dupes, and higher-income shoppers are leading this charge with 70% of households earning $150,000 actively seeking them out,” said Zabala.
The Value Proposition Ahead
Added Zabala, “Dollar beauty isn’t stealing from Sephora and Ulta — it’s stealing the basket at CVS, Target, Walmart and Walgreens. Dollar stores undercut their shelves — $3 mascara at Dollar General vs. $9 at the drugstore— and capture not only the trade-down trip, but also mid- and high-income shoppers chasing TikTok trends, dupes, and social buzz. That’s why they’re winning the same shopper their rivals are fighting hardest for. Even Five Below is climbing fast, with beauty and seasonal buys becoming core traffic drivers,” she said.
The real story isn’t about trading down from prestige — it’s about squeezing the middle, according to Zabala who added that drugstores and mass players built their advantage on “affordable beauty.” Dollar stores are dismantling that ladder by proving quality and trend can live at a $3 or $5 price point. “Once shoppers discover that, paying $9–$12 for mascara at CVS or Target starts to feel irrational,” she said.
“If the middle tier of beauty [drugstore and mass] keeps losing ground, it’s not just dollar stores that win — it’s the two ends of the spectrum. Shoppers save at the dollar store so they can splurge at Sephora or Ulta. Which means dollar beauty isn’t cannibalizing prestige; it’s funding it.”
Read the full article on BeautyMatter.
