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<\/a><\/p>\nDuring early trials, ModiFace ran an assessment of its technology on a broad set of social media users, scanning a sample of 1.6 million photos across 364,012 users to accurately identify a user\u2019s skin tone. The scan accurately detected skin tone with 98.3% accuracy2<\/sup>.\u00a0This kind of feature recognition is critical in a consumer\u2019s beauty journey, especially in categories like foundation and concealer, where a key consumer concern in the shopping process is how a brand\u2019s new product offerings fits that consumer\u2019s specific skin type and skin color. Retailers and brands spend significant time and resources training in-store staff to approximate those same details for consumers in store to better facilitate the decision-making process.<\/p>\nL\u2019Or\u00e9al Acquires ModiFace<\/strong><\/p>\nL\u2019Or\u00e9al, the largest global beauty conglomerate with \u20ac26.02 billion in sales in 20173<\/sup>,\u00a0acquired ModiFace in March 2018 because of machine learning technology\u2019s growing role in the beauty industry. \u201cWe see technology bringing so much innovation in the consumer decision journey for beauty,\u201d says chief digital officer Lubomira Rochet4<\/sup>. \u201cIt\u2019s the first time L\u2019Oreal acquired a tech company, a non-beauty brand. So it\u2019s really very significant from a strategic standpoint. And what we have in mind with ModiFace is to create the heart of our digital research and development.5<\/sup>\u201d<\/p>\nBeauty has historically been one of the later adopters to technology trends, but with the rise of hugely successful digital-native brands like Kylie Cosmetics, the industry is actively seeking ways technology can give their brands a \u2018boost\u2019 in the consumer ecosystem.<\/p>\n
In the short-term, ModiFace is currently being integrated into L\u2019Or\u00e9al\u2019s new digital arm, the Digital Services Factory, a network that creates digital solutions for the portfolio of brands under management. Before the integration, the revenue model hinged on the number of platforms (e.g., mobile, online, in-store) a brand or retailer wished to purchase, roughly $200,000 to $500,000 per year for use of the technology. Integrating new categories, from hair dye to new tools like live streaming, applied to all brand partners, with no \u2018pay-to-play\u2019 discrimination between brands6<\/sup>.\u00a0The business model fits an odd niche in the L\u2019Or\u00e9al portfolio \u2013 many of its customers are either direct competitors to the L\u2019Or\u00e9al family of brands or retail partners, like Sephora. Historically, ModiFace has powered technological offerings for many of L\u2019Or\u00e9al\u2019s direct competitors including augmented reality mirrors for MAC stores, virtual try-on services for Bobbi Brown Cosmetics\u2019 mobile and web sites \u2013 two brands owned by the Est\u00e9e Lauder Companies7<\/sup>.<\/p>\nIn the long term, diversified data is critical to the evolution and continuous learning principles of machine learning \u2013 the ability to serve brands and retailers beyond the L\u2019Or\u00e9al portfolio is critical to maintaining ModiFace\u2019s leading position in the beauty technology marketplace. Competitors have faced similar organizational challenges and succeeded \u2013 LVMH has managed to keep its brand incubator Kendo Brands (creator of brands like Rihanna\u2019s Fenty Beauty, Kat Von D and Marc Jacobs Beauty) a separate business line from its retailer, Sephora, by maintaining rigorous guidelines on innovation to prevent imitation.<\/p>\n
Future of the Consumer Journey<\/strong><\/p>\nThe ModiFace deal has triggered key competitors to think more critically about how machine learning and augmented realty technologies will complement brand portfolios, like Coty\u2019s acquisition of YouCam Makeup in 20175<\/sup>. Partnerships with technology giants like Samsung give L\u2019Or\u00e9al significant access to consumer behavior data. ModiFace\u2019s embedded software in Samsung\u2019s Bixby vision camera create new opportunities for L\u2019Or\u00e9al to integrate its marketing prowess with this new source of data.<\/p>\nThe future success of the L\u2019Or\u00e9al-ModiFace partnership hinges on a few key questions: how exactly will the consumer beauty experience evolve online and offline with AI in the industry spotlight? What changes will beauty conglomerates make to the shopper experience given this wealth of new consumer behavior data?<\/p>\n
How consumers and industry players react to the increasing presence of AI and personalization technology will certainly shape the future of the beauty industry.<\/p>\n
(Word Count: 761)<\/p>\n
<\/p>\n
[1] ModiFace, \u201cProducts,\u201d www.modiface.com, accessed November 2018.<\/p>\n
[2] \u201cApp Scans Your Social Media Photos for Optimal Skin Tone,\u201d Global Cosmetic Industry<\/em>, Vol. 184, No. 2 (March 2016): 6.<\/p>\n[3] L\u2019Or\u00e9al, 2017 Annual Report (Paris: L\u2019Or\u00e9al, 2017), p.1.<\/p>\n
[4] \u201cAI technology to take beauty to new reality,\u201d Chain Drug Review<\/em>, Vol. 40, Issue 9 (March 4, 2018): 28-28.<\/p>\n[5] Jack Neff, \u201cL\u2019Oreal buys ModiFace to get edge in beauty augmented reality and AI,\u201d Ad Age<\/em>, March 16, 2018, https:\/\/adage.com\/article\/cmo-strategy\/l-oreal-acquires-modiface-edge-beauty-augmented-reality-ai\/312764\/, accessed November 2018.<\/p>\n[6] Hilary Milnes, \u201cModiface is becoming the go-to provider of augmented reality to beauty brands,\u201d Glossy<\/em>, October 6, 2017, https:\/\/www.glossy.co\/new-face-of-beauty\/modiface-is-becoming-the-go-to-provider-of-augmented-reality-to-beauty-brands, accessed November 2018.<\/p>\n[7] Allison Collins and Adriana Lee, \u201cBeauty Brands\u2019 ModiFace Dilemma: Other AI and AR providers are seeing an influx of inquiries from beauty companies following the deal\u201d, WWD: Women\u2019s Wear Daily<\/em>, April 12, 2018, https:\/\/wwd.com\/beauty-industry-news\/beauty-features\/beauty-brands-modiface-dilemma-1202644840, accessed November 2018.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":"
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<\/a><\/p>\n