Is AR the solution to the sluggish growth of online makeup sales?
Many major beauty brands and retailers (including Estée Lauder, L’Oréal and Sephora) have introduced augmented reality experiences to their websites and mobile apps, allowing customers to `virtually’ try on makeup products.
These technologies began with simple coloured cosmetics like lipsticks and eyeshadows but now many apps allow users to test products like highlighters and foundations by adjusting for light, texture and shine. They also support video and photographs.
While online retail has been growing rapidly over the past decade, beauty is lagging behind other categories, especially when it comes to impulse purchases. Many consumers are reluctant to buy cosmetics online given that most beauty brands do not accept returns and it can be extremely difficult to judge a product without testing it first. This is particularly true for light-coloured products (pink lipsticks, highlighters), which can look flattering when shown on pale-skinned models but don’t work well on darker skin tones.
Consequently, adopting AR technologies can benefit beauty companies in a number of ways, the most important one being increasing online sales and conversion. By allowing users to `virtually’ try on different makeup products and experiment with new product combinations, AR apps can give customers more confidence when purchasing beauty products online. This seems to be reflected in sales, at least according to internal statistics gathered by AR apps: YouCam Makeup claims the AR experience makes customers spend 2.7 times more on beauty, while ModiFace’s data shows that its technology can double online conversion.
AR technologies can also be a source of valuable customer data. Knowing which colours and brands each user has tested and purchased, beauty retailers can create a more personalised experience for consumers and advertise more effectively. The data collected can also be used for product development by enabling brands to see which products are frequently tried on but not purchased or which colours are regularly worn together. L’Oreal, for example, uses data sourced from its AR apps to gain insight into changing consumer tastes and needs.
AR creates a range of opportunities for beauty retailers but in order to bring the desired results, it needs to be executed well. If the virtually created look appears ovedone or unnatural, customers are likely to be discouraged from making a purchase. According to ModiFace, when the virtual products do not appear correctly on the user’s face, the conversion rate drops by 22%. AR can be a highly effective tool in increasing online sales, but cutting corners or using subpar technologies can have the opposite effect.