You Can’t Spell ‘Beautiful’ Without ‘AI’ — How the Beauty Industry’s Innovation is Changing Consumer Sentiment Around the Technology

The entire world is buzzing about artificial intelligence, but most Americans are more concerned than excited. However, when used responsibly, AI can actually bring joy to everyday life — and chances are it’s already doing so thanks to early adoption from the retail industry.

The beauty sector in particular has quietly been ahead of the curve when it comes to AI innovation, with brands and retailers implementing the technology to solve fundamental consumer pain points. This has created a natural entry point to open people’s minds to AI and shift sentiment towards the technology. Here are three ways the beauty industry is moving towards a future that accepts — and embraces — AI.

Personalization, a Win for Both Brand and Customer

E-commerce has revolutionized the way consumers shop, but combing through never-ending catalogs with mostly irrelevant products can be frustrating. Consumers want a buyer’s journey that caters to their specific needs. In fact, 75 percent of shoppers would pay more for beauty and skincare products if they received personalized online shopping experiences.

While beauty brands and retailers have long tracked customer behavior and preferences to provide customized recommendations online, AI can take personalization to new heights. For example, Neutrogena launched the Skin360 application, which uses precise AI and dermatologist expertise to identify consumer skin goals and help customers identify the right skin care products and routines for their skin. By understanding each person’s unique needs instead of preferences, companies can more effectively surprise and delight customers with products and experiences that are tailor-made for them.

Try Before You Buy … From the Comfort of Your Own Home

The inability to try on products before buying has long been a challenge for e-commerce — and it’s especially true for the beauty category. A shopper might like a shade of eyeshadow online, but once applied they might not like how it looks on their skin. This has resulted in stubbornly high return rates for beauty products. However, the rise of AI and augmented reality-powered virtual try-on (VTO) is making an impact.

VTO allows consumers to test out different beauty products from their phone or computer and see exactly how it will look in real life based on their skin tone, face shape, and more. Though VTO isn’t new, the incorporation of AI has made the experience much more realistic and user-friendly. Almost every major beauty brand and retailer today — from Estée Lauder and e.l.f. to Walmart and Sephora — has implemented this technology within their websites and mobile apps. As a result, they’re seeing significant boosts in engagement and sales conversions, decreased return rates, and happier customers.

Customer Service That Really Understands You 

Unlike shopping at brick-and-mortar stores, it can be tough to get questions answered or concerns addressed when shopping online. It often involves engaging with chatbots with limited functionality or spending the day on hold to talk directly to a customer service representative. Even after all this trouble, there’s no guarantee the consumer's question will be answered — and, oftentimes, they simply need advice.

Thankfully, generative AI is transforming customer service and ushering in a new generation of smarter, more engaging chat tools that can address customers' needs in a more human way. Last fall, Ulta introduced a virtual beauty assistant which uses generative AI to tap the retailer's robust beauty knowledge to not only handle typical customer requests like facilitating a return, but also provide detailed product advice and recommendations based on the customer’s line of questioning. Chatbots with this type of understanding and knowledge provide an opportunity to not only answer shoppers' questions, but also to subvert their expectations and connect on a deeper level.

Alice H. Chang is the CEO of Perfect Corp., the leading artificial intelligence and augmented reality beauty and fashion tech solutions provider and the developer of the award-winning YouCam apps.