Personalization As The Digital Strategy For Beauty Commerce
By Sampo Parkkinen, Revieve
Beauty is one of the most personal verticals of all of retail, if not the most personal. After all, in beauty, we are talking about products that you as the consumer put on your face, quite literally. In physical brick-and-mortar stores, the personal nature of the beauty industry is clearly evident in the important role the in-store beauty consultant plays in helping consumers discover, evaluate, try on and ultimately purchase beauty products. And it’s no wonder that consumers need assistance in this category. If you’ve ever wandered into a beauty retailer’s store or lost yourself in the beauty section of a department store, you know all too well the endless number of alternatives the consumer faces when trying to figure out which beauty products to purchase.
This extreme personalization of the in-store beauty customer experience can be seemingly difficult to replicate across digital channels, where consumers are increasingly looking to be serviced to the same, if not a better, degree as they currently are in stores. And quite honestly, they have every right to that expectation. The vast troves of digital footprints left by consumers across the digital realm should make it easier for retailers and brands to create a uniquely personalized customer experience in digital channels — especially in a vertical of retail that is already so personal.
In addition, advances in modern technologies like computer vision, AI and AR greatly assist in providing an experience that’s even more personalized than that of the experience consumers receive through the in-store beauty consultant, making this type of ultimate personalization or even individualization of the customer experience more than possible. In fact this level of personalization should be the driving force of a digital strategy for any beauty brand or retailer.
The general benefits of personalization in other key retail verticals, like fashion, are well understood by brands and retailers. Moreover, consumers in fact expect personalization as part of their digital experiences. In a vertical like beauty, where the usage of products themselves is of a highly personal nature, the importance of personalizing the customer experience is highlighted even more.
Rest assured, there are real, significant benefits to personalizing or even individualizing the beauty customer experience. These benefits range from pure brand-related soft benefits to tangible, immediately measurable revenue-generating benefits. Having had the fortunate opportunity to work with brands and retailers across four continents in helping create individualized customer experiences in beauty, we’ve highlighted several advantages of personalizing the beauty customer experience, leveraging modern technologies that can provide your brand with a sustained competitive advantage. These key benefits of individualizing the beauty customer experience include:
- Increased customer retention: Personalizing the beauty customer experience helps position you as an expert in beauty in the eyes of your consumers, a trusted partner who understands their needs. This expert status increases customers’ trust in you and creates tangible customer retention, with consumers returning to benefit from this expertise time and time again.
- Brand Leadership and Innovation: Providing a personalized customer experience for your beauty customers with the help of modern AI and AR-technologies leads to consumers perceiving you as an innovator — someone who they can count on to receive a customer experience that improves over time, and someone who doesn’t shy away from continuously improving the experience you provide to them.
- Conversion and Revenue: Personalizing the beauty experience also leads to tangible business results. Increased conversion and average shopping basket size are direct, tangible indicators that you will receive as a result of personalizing the customer experience that are immediately visible and have a real, measurable impact on your bottom line — an ROI no CFO can disagree with.
If the benefits of personalization aren’t enough for you to consider providing your shoppers with a superior customer experience, let me leave you with a leading thought. Besides being the most personal vertical of all of retail, beauty is also the most lucrative. Beauty products command margins like no other category.
With high margins comes elevated competition. Over the last years, not only have the channels through which consumers can purchase beauty products increased from brick-and-mortar stores to online to mobile apps to marketplaces, but so have the number of available service providers in each of those channels. Beauty brands have moved direct-to-consumer, department-stores are organizing their growth efforts around beauty, pharmacies are looking for beauty to drive growth in the future, digitally native beauty influencers are starting their own beauty lines and even fashion retailers are embarking on a journey into the beauty category.
In the middle of all this elevated competition for consumer attention and spending power, if you’re not looking to compete by providing a personalized customer experience for your beauty shoppers and placing personalization as THE key digital strategy for your beauty brand or retail chain, how will you stand out?
Sampo Parkkinen is the CEO and Founder of Revieve, a leading beauty-technology company and the creators of the Digital Beauty Advisor, the ultimate form of personalization in the customer experience for beauty shoppers. As a serial entrepreneur in helping retailers and brands leverage technology in order to gain a competitive advantage, Parkkinen is a sought-after guest speaker and expert in providing solutions that create tangible long-term value to consumers through the customer-experience, resulting in increased operational results for retailers and brands. As the author of several patents, Parkkinen is also well versed in understanding the very cutting edge of technological innovation.