Consumers are no longer satisfied being sold products alone, they now expect brands to understand them intimately – and use that knowledge to go beyond traditional brand-led products and deliver devices, services, experiences and science-led products that deliver on their individual needs at the place, point in time, etc that they are at.

For beauty companies, being equipped to rapidly adapt to individual needs is crucial to gaining market share, especially given the scale of growth expected out to 2030.

Growth at the Intersection of Beauty and Science

One of the accelerating effects of the pandemic was the way people are thinking about their beauty and wellness in a more holistic way. They are seeking science-led solutions that enhance beauty from the inside out. Just look at how consumers chose products and endorsed by scientists themselves. For instance, Dr. Hauschka, Dr. Dennis Gross, Murad and SkinCeuticals were formulated by dermatologists, chemists and other beauty experts.

You just need to look at the momentum gathering pace in cosmeceuticals — cosmetic products with bioactive ingredients that claim medical benefits — for proof that growth in beauty is not being driven by growth in traditional beauty categories. In fact, the cosmeceuticals market size reached $49.5 billion in 2021 and is expected to reach $79.3 billion by 2027.

Successful beauty brands will be those that establish a culture of reinvention founded on collaboration between marketing, science and R&D and those that start to invest in innovation capabilities at a level closer to that of big pharma.

We’re already seeing some examples of companies investing in innovations that meet the growing need for science-led beauty products. For example, L’Oréal invested more than €1 billion a year in research and innovation and last year filed 561 patents.

Transforming Beauty Brands from the Inside Out

Beauty companies, therefore, need to be willing to reset their business strategies to meet the emerging needs of people while laying the foundation for future growth — and do so as part of a broader and continuous reinvention of the business — if they want to truly capitalize on the opportunities.

It means cutting across siloes to embrace new capabilities, skills, and ways of working. It means drawing on experience to continuously reimagine how they can succeed in the future. And it means using digital technology to better understand and anticipate consumers’ multifaceted, individual and nuanced needs.

There are four steps beauty companies getting started on their journey of reinvention:

1. Understand people holistically to deliver on their diverse needs.

Firstly, beauty companies should not overgeneralize when it comes to examining the drivers of consumer behavior. People are complex and each individual consumer, will have individual and ever-changing needs. Instead, beauty companies need to understand the nuances of the person holistically. Key to success will be bringing together all the data to understand, anticipate and adapt to evolving consumer needs on a much more granular level.

2. Reimagine the portfolio to be science-based.

The second important step is to scan patterns of consumer behavioral data and mindset shifts to understand how beauty consumers are defining and caring for their health, wellbeing, and beauty holistically. It doesn’t mean taking the pharma approach of investing into large research programs. Instead, beauty companies should focus on understanding what consumer needs are unfulfilled and then using the right products, the right technology and the right channels to create the best experience to meet these needs.

Just as every individual consumer is different, so is the way product marketing and commercialization should be approached. Successful brands will be those activated across multiple channels – including brand-owned direct channels and specialist beauty retailers – to build awareness and consumer engagement.

3. Operationalize the science-led makeover with the right capabilities.

The third step requires every beauty company to have rigor, speed, and precision across the board. This means having access to people with the right skills and specialist knowledge such as dermatologists or biochemists.

For others, it’s about bringing in the expertise and brand attributes from the outside. Consider how Beiersdorf AG strengthened its expertise in acne treatment through acquiring a majority stake in S-Biomedic NV, a frontrunner in skin microbiome research.

By organizing these capabilities across cross-functional processes – for instance, innovation that is informed by data and insights – beauty companies will be better positioned to rapidly respond to scientific developments, early market shifts and evolving consumer signals.

4. Technology is the enabler.

Lastly, managing and processing the data needed to deliver the level of consumer experiences, requires a strong digital core – including cloud, data, artificial intelligence (AI), machine learning and security. Consider how, with the right digital core, AI-generated content can become accessible across the business and become an essential creative partner in the development of hyper-personalized and contextualized digital content. For example, La RochePosay’s MyRoutine AI is an AI-powered, dermatologist developed, digital tool that scans a user’s skin and recommends a personalized skincare regimen and respective products.

Beauty has a new look

Beauty is going through one of the largest changes we have seen in recent decades. Successful companies will be those that use technology to better understand people’s multifaceted and ever-changing needs, continually develop science-based products and brand experiences that people want to buy, while building cultures that are laser-focused on innovation and ongoing reinvention.


About the Author
Audrey Depraeter-Montacel is managing director – Retail, Fashion & Luxury – Beauty Lead at Accenture. 

See Also:

Cosmeceuticals Do Not Exist