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How AI is revolutionising skincare & beauty industry

Artificial Intelligence

After AI has taken over the skincare and beauty industry no one goes out to shop for their makeups & foundations ranging from shades to moisturizers to the glittery nail paints or anything.

Beauty & skincare e-commerce has given us an alternative mode for shopping – sitting at our couches, matching & choosing the best products, and ordering them straight to our homes.

The adoption of online store shopping in beauty & skincare industry saw a much steadier rise in last decade.

skincare and beauty industry saw a steady rise in adopting online store shopping

This was mainly because of the gradual advancement of efficient home delivery, improved user experience, ease to shopping, and gradual trust-building. 

Although it is pretty comfortable to shop for your cosmetics online, there had been some constant drawbacks. One, the level of personalization which the salesperson used to provide at the brick and mortar stores, got missing in the online shopping. Second, the advantage of trying out products is not an option online. 

Consequently, the volume of returns for these products increased which has directly impacted the user experience. Not to forget, user experience is one of the most important parameters for e-commerce sales.

This entailed the necessity to introduce technology that can rectify/improve these issues on scale and increase the user experience.

The world’s largest beauty companies including Estée Lauder, L’Oréal, and Procter & Gamble are all embracing the latest emerging technologies, from artificial intelligence to augmented reality, to give customers a more personalized, tailor-made approach to beauty.

J.P. Morgan Research

In the last few years, introduction of technologies like – Machine learning, Augmented reality, Artificial intelligence has revolutionized the beauty industry.

Beauty Industry during COVID

The pandemic hit the world in 2020 and no one was left unimpacted by it. The skincare and beauty industry had also taken a massive toll. Revenues had shrunk, losses were made. The main reasons for that were –

a. Lockdown

There were strict lockdown restrictions from time to time which neither allowed shoppers to move out of their homes nor the store owners to open their shops. It became even harder for stores that were not online.

b. Delayed deliveries

There was some instance where there was lockdown relaxation during the pandemic. But there were several issues from shipping to distribution plus cut-short employees to minimize losses made the deliveries delayed most of the time.

c. Reduction in revenue

Since stores were not open most of the time, the offline sales had stopped for quite some time, and online was the only channel. And since offline sales had always been the majority sales for the skincare and beauty industry, there was a significant drop in global cosmetics sales.

d. Mandatory use of facemasks

Maintaining distance and using of face mask was also seen as one of the problems to try out products in the stores.

This led the offline channel for the beauty industry to contract by 1.2% in 2020. But this was a blessing in disguise for the online sales. Let’s be honest, the use of skincare and beauty products to stop is not possible. If it was not offline, then it had to be online. Many brands that were just selling at offline stores, started coming online. The pre-existing brands on online platforms made this channel the focus of attention. And hence the online channel for beauty in the U.S. grew by 5.6% in 2020. (Source)

Surfing through different brands on phones and laptops is so easy. Therefore, competition amongst brands there is cutthroat. Since online sales became the focus of attention, brands tried to put more emphasis on the user experience to make sure maximum visitors convert to loyal shoppers. It was not that it started after the pandemic started. It had been in slow-paced progress which accelerated this pandemic.

Virtual Try-on in Beauty Industry

The first major step taken towards AI in beauty industry was seen with the launch of Makeup Genius by L’Oreal in 2014. Makeup Genius was an augmented reality app. It allowed customers to do a virtual try-on of cosmetic products without going into the store. This is something that’s even more needed since COVID. The virtual try-on app had so many options and features. But they were not able to convert the sales which they were hoping for. So, L’Oreal then started using artificial intelligence to target customers more effectively with the big data they collected.

Virtual Tryon
Using AI in Beauty - Virtual Try-on

Face Mapping 

Following this, many other cosmetics companies have adopted their own versions of augmented reality virtual try-on apps. Another exciting use of AI in beauty has been the development of skin diagnostics through face mapping and product recommendations.  Just by a single selfie, extracting a lot of information is possible. One can understand what the customer’s skin type is, what undertones they have and whether they have common skin issues such as acne, rosacea, dryness, pores, and much more. Beauty companies can use this valuable information to tailor product recommendations. 

Shade finder quiz 

A valuable part of knowing your customer’s exact skin type is to make your marketing costs lower. So, companies nowadays try to get this by adding skin quiz/foundation quiz/ shade finder. Whatever way you want to market it. Here is Tangent’s AI-powered shade finder. Customers just need to upload a selfie and answer a few questions about their skin and the types of products they are using. This gives a beauty company valuable information. Landing pages and email campaigns can now leverage this data to directly increase revenue.

Future of AI in the beauty industry

Even though the pandemic issue is resolved to a large extent, shoppers have adopted online shopping more and more. This does not mean that people will stop shopping offline. But the percentage of online sales will definitely grow rapidly. Online sales are projected to make up 48% of all beauty sales by 2023. This means that more and more investments will be made in the field of AI by the skincare and beauty industry.

 

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