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Digital Technologies Shape New Business Models Of Cosmetic Firms

May 23, 2018: 12:00 AM EST
Digital technologies and applications, including social media, continue to shape new business models for cosmetic firms, challenging established brands to adapt to changing consumer behavior. There is a growing need for cosmetic brands to shift from a product-based to an experience-based model. L’Oréal, for instance, is using artificial intelligence to map out market trends and personalize its service for consumers while Elizabeth Arden partnered with YouCam Makeup app to let customers try products virtually using their phones' cameras. Other brands, like Fenty Beauty by pop star Rihanna, bank on the inclusivity of their products: Its ProFilter Foundation line aims to cater to every skin color with its 40 shades. Social media influencers also present opportunities for brands to reach out to new markets. In 2017, beauty-related YouTube videos recorded 88 billion views, a 60% increase from the preceding year. Consumers won’t accept a one-size-fits all approach from brands, which can leverage consumer data to offer a more targeted service. A recent Accenture Interactive study found that consumers prefer to buy online from retailers that know their previous purchases and can recommend products based on them.[Image Credit: © Kendo Holdings]
Georganna Simpson and Edward Craig, "How digital has changed cosmetics and what this means for consumers", Campaign UK, May 23, 2018, © Haymarket Media Group Ltd
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