Gen AI Transforming the Beauty Industry? Not so fast
While AI has been around for quite a long time, this past year has been the year of Generative AI. According to McKinsey, formally, Generative AI, “describes algorithms that can be used to create new content, including audio, code, images, text, simulations, and videos.”[1] With each industry attempting to figure out how to incorporate Gen AI into their everyday business operations, Beauty as an industry has been extremely vocal about leveraging its power to better not only business operations, but also better customer experience. A recent Women’s Wear Daily article, titled, “Generative AI Will Make Over the Beauty Industry,” investigates many of these applications, and makes the argument that AI applications to this industry provide smaller brands and new entrants a way to enter the industry at a much lower cost.[2] While this may be true, the subtext of this argument is that using gen AI, a new brand can enter the game at a much lower price point and see successful performance. However, I will argue that while there are many practical and helpful applications to the beauty industry, some of which I will discuss below, generative AI should not be used as a replacement for net new companies building their brand persona, vision, and differentiating edge, if they hope to one day successfully disrupt and grow within the already massive industry.
I’ll start with describing the ways that AI is undoubtedly an asset for existing larger players in the beauty space. Gen AI helps to provide solutions to many of the problems a lot of these brands have been facing since the pandemic: meeting volatile demand in multiple global markets and facing issues of forecasting accurately,[3] adjusting products/strategy/marketing assets to meet the fickle preferences of consumers, and reaching those same target consumers with a marketing message that will resonate at the right moment. Additionally, from a product development standpoint, Gen AI can help to identify trends in efficacious active ingredients, while also providing recommendations for sustainable packaging. Gen AI is also helpful in matching customers to the right skincare for their skin type, as evident in new skin analysis tools using AI to identify areas of improvement on a consumer’s skin. To do all of this, Gen AI relies on a monstrous amount of data, that is, existing consumer data and brand data. Thus, these tools are helpful in creating a more efficient operative ecosystem at beauty brands, as well as helping customers achieve better, more tailored results based on how other consumers react.
The core piece I take issue with however, is that there is also a lot of talk about leveraging Gen AI to create content, branding, and campaign concept material. Tools like Jasper.AI have features now that allow for brands to upload sample content and style guide rules regarding how its company or brand describes its products, and Jasper.AI will generate marketing concepts that leverage past campaigns and other available data, combined with the brand’s specific voice, to generate something new.[4] Tools like Midjourney[5] similarly are able to create stylized product and campaign imagery for brands after being fed design direction, a process that can sometimes take a brand months to finish otherwise. These tools, for the beauty industry specifically, industry leaders at Beautymatter argue, “have essentially bulldozed barriers to entry (like technical expertise and capital requirements), ushering in a new era of possibility.”[6] While it is true that the pace at which content can be created is now no longer a hurdle, I’d argue the likelihood of that content being game changing enough to build a brand that breaks through an already extremely crowded space is slim to none. If we examine history, of course the new is always just a fresh perspective on something old. However, when a LLM or other Gen AI powering model is trained on only the old, where does it get the ability to generate a fresh perspective? In the past, brands gained traction because they broke the mold and stood out. If a model is simply using the point of view of founders past, it surely may be able to recognize successful patterns, but simplying respinning those patterns will not be enough to help establish a brand that will be able to disrupt an industry so heavily reliant on authenticity, connection, and human perspective.
Gone are the days that digital marketing is the key to success, especially for a new brand. Instead, one organic Tik Tok video can cause a new brand with little to know distribution to suddenly have a waiting list of thousands. Similarly, a rave recommendation from your friend’s sister about something that changed her skin for the better is more likely to send you to immediate purchase than a series of 3–5 digital marketing touchpoints with creative and copy that looks like a rejiggered version of something you have seen many times before. Doing something that is not already being done is the key to building a foundation of success in beauty specifically, and while new entrants can undoubtedly get to market much quicker than they once could, if the plan is to rely on Gen AI to create branding documents, assets, and marketing, it is almost certainly will fall flat. With this, some will argue that well of course, you can’t rely solely on AI, but it is a great starting point. To that, I’d argue that AI can, on the opposite side, serve as an unfortunate anchor for a designer. If they have a mock-up of a campaign or a potential tagline they intend to iterate on, they are forcing themselves into the bounds of what already exists, vs. thinking of something fresh and new.
This is all not to say that generative AI is not changing the game for the beauty industry. It is, as it has the ability to make the leading beauty giants even bigger, profitable, and more pervasive in every day life, and in cases, it can even propel new entrants forward in building the foundation of their brand. But, I will argue that Gen AI has not bulldozed perhaps the most critical barrier to entry in this industry: human creativity, laced with a fresh, unrecognizable perspective.
[1] “What is Generative AI.” https://www.mckinsey.com/featured-insights/mckinsey-explainers/what-is-generative-ai
[2] “Generative AI Will Make Over the Beauty Industry.” https://wwd.com/beauty-industry-news/beauty-features/generative-ai-make-over-beauty-industry-1235606447/
[3] “How Generative AI is Energizing the Beauty Industry.” https://risnews.com/how-generative-ai-energizing-beauty-industry
[4] “Generative AI Will Make Over the Beauty Industry.” https://wwd.com/beauty-industry-news/beauty-features/generative-ai-make-over-beauty-industry-1235606447/
[5] “From product personalization to customer experience, beauty brands are using AI to supercharge creativity and innovation.” https://beautymatter.com/articles/beauty-brands-using-ai-to-supercharge-creativity-and-innovation
[6] “From product personalization to customer experience, beauty brands are using AI to supercharge creativity and innovation.” https://beautymatter.com/articles/beauty-brands-using-ai-to-supercharge-creativity-and-innovation
