With the global cosmetics industry on the rise, large consumer-products players are scrambling to evolve and meet the new demands of their Millennial consumers. While traditional industry leaders buy up smaller competitors and launch new products, smaller, niche-market entrants have taken away market share as they woo a more eco- and health-conscious cohort.

The booming global cosmetics industry is now worth an estimated $56.7 billion, with skincare making up 36.1% of the whole. As the industry is still dominated by major companies such as L’Oreal (LRLCY), The Estee Lauder Companies Inc. (EL), Procter & Gamble Co. (PG) and Unilever (UL), startup brands have multiplied quickly. The number of brands to chose from has catapulted the success of Birchbox, a monthly subscription-based business that sends costumers an array of personalized beauty samples to their door. (See also: The Economics of Birchbox.)

Luxury Meets Affordability

A recent Benziga piece by Brett Hershman analyzes the growing prevalence of “luxury brands” offering skin care products at an affordable price. For example, an old-time skincare industry leader Ciminelli Glow, once reserved for star clients at a price of $300 per in-house treatment, now touts a new product named 123 Glow that costs just $30. As approximately 50% of all Millennial woman prefer natural or organic beauty products over synthetic alternatives, market players are finding success in the intersection between premium quality and affordability.

Valuing Authenticity

Hershman also highlights a Millennial favorite, online beauty startup Glossier, which has recently raised another $24 million in Series B funding for its line of direct-to-consumer facial products.

Glossier founder Emily Weiss says the company has gained its cult following due to its unique focus on engaging customers and keeping communication channels open while valuing transparency and “voice.” For example, in an interview with TechCrunch, Weiss explained the firm’s marketing strategy: “We like to think that whenever we talk to our customer through captions on Instagram or through email or through copy on the site, that we’re writing text messages to a friend.”

Traditional cosmetics leaders are taking note. In Revlon Inc.’s (REV) first major marketing push since its acquisition of Elizabeth Arden Inc. last year, the cosmetics giant is teaming up with Amazon.com Inc. (AMZN) in order to reach Millennials who increasingly chose ecommerce over traditional in-store shopping. Amazon will stamp Revlon’s name on 10 million shipping boxes as Revlon attempts to boost its social media and digital technology initiatives.

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.