X Files #3 Personalised Beauty
We are pleased to release our latest X Files, bringing you an exclusive review of how technologies and digital innovations impact consumer trends and behaviors.
This issue, dedicated to personalised beauty, is largely inspired by discussions that took place on 29th and 30th of October 2019, at the Personalised Beauty Summit in London organised by Kisako Research: https://www.kisacoresearch.com/#about-us.
During this event, 200 beauty professionals met for two days debating the convergence of beauty and technology while trying to assess if personalisation is just a buzz or a deeper trend disrupting the world of beauty.
1/ A question of definition
There is a lot of confusion when defining personalised beauty.
For better clarity, one can distinguish:
▸ Personalisation offering a truly personal product, ie a bespoke formula or fragrance blend based on data collected from an individual customer. Usually produced in a dedicated lab, it is sometimes manufactured at point of sale through a dedicated machine.
▸ Customisation which allows customers to play with existing beauty products. This includes layering existing products, adding a booster, creating a personally composed color palette, engraving a bottle with a unique message and many other options.
▸ DIY/Home made where consumers mix raw ingredients to create their own beauty product or fragrance.
▸ Individualized product recommendations where digital technologies such as machine learning and artificial intelligence are combined with human knowledge to help customers find the best product adapted to their needs.
▸ Tailored and exceptional experience offered at point of sales, in beauty salons and online (UX) to drive engagement and increase revenues.
2/ From custom-made to mass and indie
For centuries, beauty was actually very personal. It was made in apothecaries where custom-made preparations and fragrances were formulated for rich and individual customers.
Mass-production of beauty products appeared in the post-war 20th century. Large beauty Groups with an extensive portfolio of brands emerged and dominated the market by imposing their conditions on retailers and pumping large budgets into mass-marketing.
Over the last 20 years, barriers to entry have been falling thanks to small-batch production solutions, shifting of communication to digital / social media and plenty of venture and private equity capital available. A flurry of indie and niche brands are now competing on the market, all offering tailored ranges that respond to precise beauty needs.
3/ A definite quest for more tailored beauty products and services
There is no doubt that a growing number of consumers are shifting away from the ‘one size fits all’ approach, preferring to embrace products and services tailored to their individual needs and specific routine.
According to Mintel, a specialised research company:
48% of UK consumers are interested in personalising beauty and grooming products themselves
46% of UK consumers like the idea that the product is especially for them
33% of UK consumers are interested in personalisation because they think it gives better results
30% of UK consumers want to personalise the ingredients
30% of UK customers want to personalise the formulation
20% of UK customers want to mix raw ingredients to create their own product
22% of UK customers want to mix products to create something new
45% of UK customers are interested in technologies that measure skintone to recommend shades.
Figures for other countries confirm the same trend toward personalisation:
69% of Spanish consumers want their skin/hair analysed to identify their beauty needs
63% of Chinese fragrance buyers are interested in a personalised scent based on their fragrance preferences
68% of Italian consumers are interested in making a customized beauty product online or in store.
But not all customers agree: among UK customers not interested in personalisation 46% claim products off the shelve are just as good, 38% say it is quicker to buy existing products, 34% quote price as a real concern and 14% are worried about privacy issues.
More information can be found at: https://store.mintel.com/about-us
4/ It all starts with collecting data
Without individual consumer data there is no personalisation… but collecting beauty and wellness data from consumers raises many questions including:
▸ Privacy. As beauty is more and more associated with wellness and health, privacy and safe storage of such data is becoming a real issue for consumers and brands, especially in Europe where GDPR regulations apply and consumer’s sensitivity is the highest.
▸ Method of collecting. Some brands rely on individual questionnaires about your skin/hair, lifestyle and environment to formulate personalised products. They claim such data can be enriched over time through self-learning algorithms allowing a constant improvement in the product formulation and offer. However other brands believe individual perceptions and declarations do not correspond to the reality of skin/hair issues and must be validated by scientific measurements. For some brands, pictures taken with your smart phone are now good enough to understand your beauty issues while others offer a proper in-store diagnostic with more advanced equipment. Some of the most innovative brands go all the way to requiring DNA or blood testing for an even more scientific approach to skin and hair diagnostic.
▸ Real-time relevance. Individual data, independent of how it is collected, are only half of the solution. With at least 50% of skin and hair condition dependent on the environment, personalised beauty should be adjusted in real time based on level of hydratation, sun and light exposure, pollution and pollens, personal stress… etc. Women’s menstrual cycle is also clearly impacting their beauty regime.
▸ Data ownership. With more and more beauty brands offering beauty diagnostics, will consumers continue filling lengthy questionnaires at brand level or prefer to do it through a trusted multi-brand beauty center, retailer or app? Or will the data be actually collected and stored by large digital players such as GAFAs, mobile phone manufacturers or mobile communication operators? Google just announced the acquisition of Fitbit a clear signal it considers personal wellness as a key driver of its digital strategy. Eventually will consumers want to actually monetize their beauty and wellness data themselves to retain some of its value?
5/ Many hurdles to overcome
Formulating and manufacturing personalised products mean developing proprietary and adjusting manufacturing process regularly based on a rapidly changing volume of business.
Over a ten years period, Function of Beauty, a personalised haircare brand, developed 6 generations of manufacturing solutions, all fully protected through customised coding (but not patented to actually avoid risks of copying).
Formulation means checking the absence of toxicity, validating product stability and confirming efficacy across thousands of combinations which must all be documented to local health authorities often not familiar with this new emerging beauty category.
Any machine used at point of sale for manufacturing of beauty products falls under specific regulations related to batch recording and control of hygiene conditions.
Due to lack of buffer stock and limited production capacity, supply chain is not adapted to peaks in demand and business seasonality.
Direct-to-Consumers brands have to pursue permanent tests on their questionnaire, UX and product formulation to better experience overtime and improve their business KPIs.
For brands that work with retail partners, installing diagnostic tools or in-store manufacturing units add another level of complexity. For Ioma, a leading French brand in personalised skincare, now part of Unilever, it meant negotiating the corresponding retail space, building a proprietary maintenance solution using cloud technologies and continuously training dedicated staff to make its solution work with selected retail partners worldwide.
6/ Expect personalisation to take many forms
From engaging consumers through data-driven product recommendations and personalised experiences to improving speed of product development and offering fully tailored products, personalisation is already transforming the beauty industry.
However personalisation is not for everyone and for every product. Off the shelf products will stay, especially in categories where the benefits of personalisation are limited. Designing my own hair color dye and subscribing for regular replenishment is a great consumer innovation but sharing data to get a personalized hand cream might never become a strong consumer proposition.
If personalisation is about celebrating the individual, we can only hope advances in technology and manufacturing will make it more accessible to all budgets.
Two trends are likely to emerge: Soft personalisation, driven by pleasure, self-realisation, transparency and sustainability leading to the development of home-made beauty products and do-it-yourself cosmetics. Advanced personalisation, driven by data and science, using the most advanced technologies to create perfectly tailored high-performance beauty products.
7/ Brands to watch
This is a limited selection of brands actively involved in personalisation. From innovative start-ups to smart initiatives launched by large established Groups, expect many more to come on the market in coming years.
▸ Customized retail experience
SK2 Future X, a smart store blending digital and physical for a unique shopping experience: https://www.moodiedavittreport.com/the-future-of-beauty-retail-sk-ii-future-x-smart-store-launches-with-the-shilla-duty-free-at-changi/
Schwarzkopf professional salon lab, a digital personalised services using a connected device that measures hair condition and colour: http://www.salonlab-server.de/
Facegym personalised serums to fit your workout, skin and lifestyle needs at a Make It Bar: https://facegym.com/whats-new-at-facegym/facegym-tools/
Jo Malone offering in-store fragrance combining consultation: https://www.jomalone.com/products/3805/fragrance-combiningtm
By Terry proposing a unique palette factory: https://www.byterry.com/news/news/palette-factory-launched-in-selfridges/
▸ Customized products
Clinique Custom blend hydrator: https://www.clinique.co.uk/cliniqueid
Living Proof Body Building hairspray with a customizable nozzle to decide how much hold you want: https://www.livingproof.co.uk/buy/perfect-hair-day-body-builder
L’Oreal Powermix Shot, a customized home treatment by adding ingredients to a hair mask: https://www.lorealprofessionnel.com/int/hair-care/powermix/mask-powermix-force
Kiehl's apothecary serum preparations: https://www.kiehls.com/apothecary-preparations
▸ Personalised DTC Brands
Function of Beauty, the world’s first fully customizable hair care: https://www.functionofbeauty.com/about/
Prose, offering unique hair care preparations: https://prose.com/about
VITL, uniquely formulated, high quality supplements: https://vitl.com/
Sillages, an online and offline perfume creation atelier: https://sillagesparis.com/en/
Atolla, a new skin health brand combining data science and personal preferences to offer a serum whose formula keeps improving overtime: https://atolla.co/
Ave and Edam, a personalised cream based on AI: https://aveandedam.com/
Nomige, personalised skincare based on DNA analysis: https://nomige.com/en
E-salon, your personal online hair colorist (this successful indie brand was sold to Henkel this year): https://www.esalon.co.uk/
▸ Personalised brand sold in retail stores
Le Labo, freshly formulated fragrances: https://www.lelabofragrances.com/about-us.html
The Alchemist Atelier, a new personalized fragrance retail concept launched by Puig: https://thealchemistatelier.com/en
Codage, a fast-growing indie brand offering made to measure magisterial skincare preparations: https://www.codageparis.com/en/about-us/
Ioma, pionner and leader in personalised skincare, now owned by Unilever: https://www.ioma-paris.com/en/mon-serum/
▸ Home-made and DIY fresh beauty concepts
Aroma-Zone, the leading French DIY retail beauty concept: https://www.aroma-zone.com/info/nos-boutiques
Romy, freshly formulated personalized skincare using the Hylab device: https://romy.paris/pages/notre-mission
Rowse, a young start-up offering luxury organic home-made beauty: https://rowse.co/
▸ Diagnostic apps
Revieve, the digital beauty advisor: https://www.revieve.com/
Perfect Corp, the smart beauty system: https://www.perfectcorp.com/consumer
Olay Skin Advisor, an AI driven skin analysis tool: https://www.olay.com/en-us/skinadvisor
Beautymatchingengine, the recommendation engine for beauty products: https://www.beautymatchingengine.com/
Sommelier du Parfum, the fragrance recommandation engine: https://sommelierduparfum.com/
▸ Advanced beauty devices
Opté, precision device to solve your skin issues (by P&G): https://the-gadgeteer.com/2019/03/28/opte-precision-skincare-system-use-technology-to-precisely-cover-up-your-blemishes/
Optune, the skincare system that takes skin measurements and environmental data to dispense a single dose of customized skincare product (by Shiseido): https://fortune.com/2019/07/02/shiseido-optune-internet-of-things-ai-and-ar-skincare-system/
Nailbot: a personal nail robot to print custom nail art on your fingernails: https://www.preemadonna.com/how-nailbot-works
Ieva, connected jewels that will monitor and enhance your beauty: https://www.ieva.io/en-us
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