L’Oréal Is Bringing Beauty Online With the Help of Augmented Reality and AI
Testing products is a quintessential element of the beauty buying experience. There's a reason the shelves at Sephora are lined with tester tubes, after all. But up until recently, the bulk of that trying-out experience has occurred in person, in brick and mortar retail locations.
L'Oréal wants to change that. The beauty giant, which owns a slew of cosmetic, skin and haircare brands, ranging from luxury lines like Kiehl's and Urban Decay to drugstore mainstays like Maybelline and Garnier, has been investing in a digital transformation that will take the in-person experience and bring it online.
In March of last year, L'Oréal acquired ModiFace, an augmented reality beauty company, which has allowed it to roll out features like virtual makeup and hair color try-ons, as well as an online skincare diagnostic, that will help people bring the experience of trying a product onto a screen. Earlier this year, L'Oréal announced that it would be bringing ModiFace's AR technology to Amazon to create the first virtual cosmetics try-on experience for the behemoth retailer.
“The thing we're trying to do here is solve consumer problems and to help them decide the right products, the right colors, the right routines, and dig deeper in this era of personalization,” Lubomira Rochet, L'Oréal's chief digital officer, told Adweek.
The purchase of ModiFace is just one of the moves that L'Oréal is making when it comes to evolving digital strategy and capabilities at the brand. Rochet said that in recent years, becoming a digital-first company has been a top priority. It's a trend necessitated by numbers: According to Rochet, ecommerce makes up $3 billion of L'Oréal's annual sales, and 50% of its annual growth. Eighty percent of the brand's content is done with digital in mind.
“As a company, we put digital first. Even in our meetings within the company, everybody starts by the digital execution,” she said. “As a cultural shift, it's pretty impressive.”
Increased digital capabilities isn't the only modern facet of business that L'Oréal is embracing: The beauty giant is also doubling down on direct-to-consumer sales, particularly when it comes to its more luxury brands, because, as Rochet said: “The luxury business is more prone to DTC, because of lower distribution in offline business, higher price points and the necessity to stage the experience and the brand equity in the best way, which we often don't find in other platforms.”
L'Oréal is also creating new DTC brands, like Color&Co, a personalized hair color brand it rolled out this past May from its tech incubator, which it has run in partnership with London-based leading global digital accelerator and incubator Founders Factory since 2016. That incubator also helps L'Oréal to discover new digital-savvy businesses and technologies to work with. This year, two new startups, Sampler and Riviter, a product sampling strategy company and a visual search engine that operates with AI technology, respectively, will join the incubator.
Teaming up with startups offering new technologies with the capabilities helps L'Oréal nurture the natural relationship the company believes beauty has with the internet.
“Beauty and digital is such a perfect match,” said Rochet. “It's so visual, it's so social, you want to share your new look, your new style, your new color.”