The beauty industry is moving and adapting faster than ever before. With technology innovation on the rise, consumer shopping habits shifting, and the importance of connection and transparency in a digital-first world, the evolution of beauty will continue to take shape in 2023.
 
As consumers demand authenticity and embrace virtual connectivity, beauty retailers must face the challenge of meeting the ever-changing needs of consumers while keeping up with industry advancements. To help brands and retailers remain relevant, visible, and on the cutting edge, here are some findings and trends to keep in mind:

Relationship Commerce Is the Way Forward

A recent study shows that 77% of shoppers believe retailers need to continuously invest in new technology to meet their evolving consumer expectations and 40% of online shoppers expect personalized product recommendations, leading many retailers to transform their online presence to cater to consumers' shopping habits.
 
However, this indicates that as consumers are more experience- and value-driven, beauty retailers must consider how every activity they deploy throughout the customer journey helps build a stronger connection with them.
 
This focus on relationship-building has led some beauty brands and retailers to experiment with personalized programs at-scale or early versions of the Metaverse (such as building interactive virtual 3D stores) to create new avenues for customers to experience their brand online and forge a deeper connection with their customers.

Brand Experiences that Enhance Loyalty

In the future, the winning brands are those that manage to stay top of mind of their customers, build exceptional brand experiences and enhance loyalty. This means that beauty retailers must be clear on how they deliver value to the customer in every interaction.
 
For instance, Revieve launched the first Skin Coach experience, which helps beauty brands and retailers guide customers on their skincare journey post-purchase. It allows users to set goals and trace changes in their skin over time after receiving personalized routine and product recommendations from Revieve's AI Skincare Advisor. Skin Coach emphasizes that the customer-brand relationship continues after the purchase. That is the next opportunity to build a deeper bond with the customer.
 
Moreover, some emerging companies, such as Coralai, combine available technology experiences with the professional service industry, such as estheticians. Coralai is the first e-tailer combining estheticians' customer base with the power of Revieve's AI skin analysis technology and Clientela's online appointment booking capabilities to provide customers with on-demand beauty experts and real-time beauty and skincare diagnostics.

Collecting Zero- and First-Party Data to Meet Consumer Demands

Data privacy awareness is growing daily because consumers hesitate to share their data without a clear benefit. But, on the other hand, you have data privacy regulations that are becoming more stringent and the cessation of third-party cookies from Chrome this year.
 
All this adds tremendous pressure on beauty retailers to gather quality data to build a more personalized customer journey. As a result, this year, we will see more brands and retailers shifting their data collection strategy to gather zero- and first-party data at-scale via personalized programs, which include beauty analysis experiences that provide individual data points on consumers' needs and preferences.
 
About the Author
Sampo Parkkinen, CEO & Founder, Revieve, is a Finnish entrepreneur, investor, author, and guest speaker who has leveraged his extensive experience working with digital solutions and technologies to enable unique shopping experiences for brands and retailers across the skin, health, wellness, and beauty categories. As Founder and CEO of Revieve, Parkkinen has led the AI/AR-powered beauty-tech provider to forge notable partnerships with global brands and retail partners such as Google Cloud, JCPenney, Shiseido, Living Proof, Marionnaud, among others.