As e-commerce continues to evolve, consumers expect greater personalization, especially in categories like beauty and cosmetics. And technology can help. Over the past year, retailers and brands have been able to use a new lever to improve the customer experience: generative AI.
With investment in generative AI expected to grow this year, Alice Chang, CEO and founder of Perfect Corp., says technology and augmented reality will play a key role. Here, Chang provides insight into the technologies and how they can best be used.
More from WWDWWD: How generative AI and AR are transforming retail and beauty?
Alice Chang: Mobile commerce and e-commerce have become the favorite shopping channels for many beauty and fashion consumers today. As more consumers turn to online channels for product advice and inspiration, it is becoming increasingly important for brands to equip themselves with e-commerce solutions that immerse and engage shoppers while offering personalized advice and recommendations. Especially with products like makeup and foundation, it's difficult for a customer to know what will match or compliment their skin tone without being able to visualize the product on their own skin.
This is where the convergence of beauty and technology comes into play. This combination has led to innovative solutions that not only change the way consumers shop, but also improve their overall experience. Generative AI and AR are reinvigorating the consumer experience by delivering beauty and fashion inspiration in exciting and creative new ways.
Thanks to the power of precision AR and generative AI, technologies such as virtual product try-on allow consumers to try out beauty products, accessories and even clothing styles. This technology enhances the e-commerce experience by providing shoppers with personalized visualizations of products, helping them choose the best products for their preferences. This not only increases consumer confidence, but also reduces the number of dissatisfied customers, leading to more purchases and fewer returns.
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WWD: How are these technologies used?AC: The use cases of AI and AR-powered beauty and fashion technology are extensive. From virtual consultations and fittings to complexion analysis, personalized skin analysis and even AI-powered clothing fittings, AI and AR have the power to match consumers with the best products for their style preferences and beauty needs.
Shopping online for beauty and cosmetics can be quite tricky. Without virtual trial tools, consumers are faced with a guessing game to decide whether a foundation really suits their skin tone, or whether a color is right for their lips. One of the biggest benefits of deploying AI and AR-powered virtual try-on is giving consumers confidence in their purchasing decisions. Companies such as Nars Cosmetics, Avon and Clinique have reported that the integration of virtual try-on solutions has resulted in significant increases in customer engagement, satisfaction and conversion.
Consumers are increasingly choosing to shop online for clothing and fashion, jewelry, accessories and even wedding dresses. Brands are seeing significant benefits from integrating AI and AR technologies into their online platforms to guide customers through the decision-making process while offering them the same fun and exploratory experience as in a physical store.
Not only has AI and AR technology done wonders for the beauty and fashion industries, it has also completely revolutionized wellness and personal care - a global market that is expected to generate a turnover of 646 by 2024. 2 billion dollars. Solutions such as AI skin analytics and skin simulations provide personalized, near-instant insight into skin concerns, skin types and skin age. These solutions are used by skincare brands that want to offer the right products to their customers, and medical spas that want to leverage emerging technology to improve the skin consultation experience. Additionally, validation by the medical community, such as the Journal of Cosmetic Dermatology, demonstrates the effectiveness of these solutions.
WWD: What is the value proposition of deploying these technologies? And the ROI?AC: Technologies such as virtual try-on, AI skin analysis and generative AI can help brands deliver personalized, inspiring and valuable experiences to consumers at scale. These technologies help shoppers visualize styles, shades and results, ultimately increasing purchasing confidence and customer engagement. As beauty and fashion shoppers look for personalized experiences from brands and retailers, these technologies will be essential for brands to compete and effectively engage consumers in the future of beauty.
In terms of ROI, by leveraging AI and AR, brands can attract new customers, improve conversion rates, and reduce return rates, all of which contribute to a positive ROI. Many brand partners of Perfect Corp. have seen up to 2.5 times higher sales conversions and an average of 8 percent decrease in product returns after implementing these technologies.
WWD: What should retailers and brands consider before investing in this technology?AC: The whole world is excited about how AI will transform our lives, and the potential of AI to improve the lives of consumers is limitless. But as with any new technology, it can cause skepticism and hesitation.
However, brands and retailers must embrace AI as a tool to delight and inspire customers while personalizing the shopping experience in new and exciting ways. When shopping for beauty and fashion products, consumers encounter a major pain point when trying to identify which products are right for their unique needs. These technologies solve that pain point, making it easier for consumers to discover the products that are right for them. With interactive experiences like virtual try-on, AI can create a more seamless and customized shopping journey for consumers.
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