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According to a report by Statista, Global retail sales are predicted to reach USD $28 trillion by 2020 — up from $22 trillion in 2016. With such huge spending power available, companies across different retail industries are working to remain at the top of a competitive retail market, and direct-to-consumer brands are targeting niche groups within it.

In the beauty industry, technology is an important driver for change, and for the success of companies in this competition to tap into purchasing power. The key drivers of new technology are firstly to create new solutions to customer demands; and secondly, to enhance customer experience and connection.

AR Beauty & Market Trends

At the cutting edge of customer-driven technology is the increasing use of Augmented Reality experiences in retail. Zion Market Research suggests that the AR industry as a whole will be valued at $133 billion by 2021; an incredible growth of 85.2% from $3.33 billion in 2015.

Vegan cosmetics brand Lime Crime have launched an app using AR to create an immersive experience. Their customers can experiment in a “magical world of color”, marketed as a way to express themselves and discover what makes them unique. Users scan Lime Crime products within the app, and then the brand’s signature character, Venus, speaks to customers about the product’s features and benefits, and also offers tutorials and demos centered on the chosen item.

It’s unsurprising that brands are turning their attention to virtual interaction with their customers, in the light of data indicating that Millennial and Gen Z beauty consumers spend more time interacting with others online than in the physical world. A report by LivePerson found that 61.8% of consumers around the world, aged from 18-34, would rather leave their wallet at home rather than leave their phone. Sixty-five percent communicate with others more online than in person. And people within this age range treat their phones as an extension of themselves, with 70.1% sleeping with their phone within arm’s reach. Crucially, a large majority of 69.5% can see a future in which 100% of purchases take place online.

With such dependence on digital devices, it logically follows that today’s consumers expect a high level of ease and online interaction with the brands they buy from. But customer experience isn’t the only area in which brands are using technology to drive change — and sales.

Beauty tech creator Shiseido has developed a skincare system called Optune, which blends digital technology with skin science and beauty research. It uses an app, informed by unique algorithms, to meet skincare needs in real time. The app assesses the skin type of the user and the conditions of the immediate environment to find the best products to support optimum skin condition. The technology monitors a range of different factors affecting skin — from temperature and humidity to mood and menstrual cycle — and then sends a product recommendation for the day. The app is coupled with a special device that loads a cartridge with the recommended product.

Beauty Brands Must Make The Most Of Tech

Big beauty name Rimmel takes a simpler approach to promoting products with technology. The brand offers a 3D AR ‘Get the Look’ experience, allowing users to apply makeup digitally to a photo of their own face. Similar ‘try before you buy’ tech is used by numerous other brands, including bareMinerals, Estée Lauder, and Sephora. These apps additionally collect data about consumer preferences and needs, thus enabling more effective and targeted advertising.

The news of Ford’s partnership with Agility Robotics could also have an impact on the back-end logistics of beauty companies. It’s possible that beauty purchases will soon be delivered by two-legged robots and self-drive cars; potentially increasing delivery speed and efficiency. Changes in the retail market driven by technological innovation are likely to occur exponentially over the coming years.

The takeaway for beauty brands is this: it’s increasingly clear that technology has to be part of your broader brand strategy. Brands must be vigilant when it comes to tech development, and maintain an awareness and curiosity for new advancements to leverage consumer interest, trust, and sales. Care/of, a brand offering personalized vitamins and supplements, sells its products in conjunction with a tracking app which monitors the supplements each customer is using, and provides recommendations for different products based on health changes.

Beauty brands who make the most of tech are doing so with great success. Along with try-before-you-buy apps, brands are using a variety of new advancements to offer unique services and tools to their customers. For example, Neutrogena has launched the Neutrogena Skin360, a skin-scanning device which uses sensors to measure the properties and needs of user’s skin. And HiMirror, first launched by the New Kinpo Group in 2016, is an Amazon Alexa voice-controlled smart mirror which speaks to users. It gives beauty advice based on skin analysis from integrated AI technology, as well as offering AR tech to enable users to virtually try on makeup in the mirror.

The unique experiences and opportunities that brands can offer customers using tech open up a new world of closeness between beauty company and beauty consumer. Some of the tech now available, such as the HiMirror, has the potential to create a whole new market of beauty consumers to bridge the divide between makeup and skincare, and tech devices. Beauty no longer has to take place in the bathroom; it can become a positive and memorable experience both at home and in physical stores.

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