How L’Oréal uses digital technology to become a ‘beauty life companion’

It blends data, creativity, and cutting-edge technology to reshape consumer experiences.

INTEGRATING technology with personalised customer experiences is crucial nowadays where digital innovation and changing consumer behaviours are driving change. L’Oréal is responding to this need by moving from “phygital” services to “beauty life companion,” with e-commerce serving as a key touchpoint.

In an interview with Retail Asia, Lex Bradshaw-Zanger, chief marketing and digital officer for L’Oréal in South Asia Pacific, Middle East, and North Africa (SAPMENA), discussed how the company is pioneering the future of e-commerce in the beauty industry by combining data, creativity, and advanced technology to transform consumer experiences.

Emerging technologies

“Our high ambitions for e-commerce require an adaptable supply chain and a vigilant eye on emerging online opportunities such as analytics and Gen AI,” Bradshaw-Zanger said.

The company is looking to shake up e-commerce by using advanced analytics and generative AI.

It is targeting improvements across the board — from understanding consumer behaviour and crafting content to marketing strategies.

So, expect a revamped online shopping experience, with smarter insights, fresh content, engaging marketing, and interactive features like virtual livestreaming and new shopping interfaces from L’Oreal.

A significant part of this strategy is to create a seamless integration of online and offline channels, whereas the company argues the need for a robust supply chain and strategic partnerships to redefine the industry landscape.

E-commerce performance

L’Oréal has stamped its e-commerce efforts with success: 27% of global sales derived from online channels in 2023 and, of course, a 9.5% net growth. The group also held the top spot in global e-commerce market share within the beauty sector last year.

The SAPMENA region, characterised by its youthful and digitally savvy population, has been particularly promising.

With 43% of the population under 25, L’Oréal has seen significant growth through digital services and strategic partnerships. In fact, the company saw over 50 million interactions with its Beauty Tech services in SAPMENA last year, resulting in more than a twofold increase in conversion rates.

Digital services and consumer-centric events, such as the Maybelline New York Chromaverse activation, have further strengthened engagement and sales.

“Consumer-centric events in partnership with e-commerce platforms also play a big role to engage consumers, recruit new customers, and increase appetite for beauty products,” said Bradshaw-Zanger.

As technology reshapes shopping habits, L’Oréal offers integrated brand interactions across physical, digital, and virtual spaces.

The company’s digital transformation, ongoing for over a decade, now sees e-commerce representing a quarter of its global sales. In 2023, L’Oréal managed 255 direct-to-consumer websites for 33 brands, ensuring an optimal consumer experience regardless of the shopping medium.

Bradshaw-Zanger pointed out that consumers now interact with brands in various ways, including watching #GRWM TikTok videos about our products, researching benefits and ingredients on our website, visiting physical stores, or making purchases online or in-store.

“Marketing hasn’t changed but marketers must,” he noted. “All marketers have to understand how our products, services and experiences we bring to consumers can be applicable in the digital age.”

Innovating for Gen Zs

To connect with Generation Z, L’Oréal invests heavily in digital innovations. Bradshaw-Zanger said virtual try-on (VTO) technologies, which have seen extensive use globally, are particularly appealing to this demographic.

Tools like BeautyCam, which has amassed 100 million uses across Southeast Asia, and livestreaming options for real-time product recommendations, are central to engaging this audience.

L’Oréal also launched the Big Bang Beauty Tech Innovation Program, an open competition seeking startups with cutting-edge solutions in augmented tech and digital services, culminating in a grand finale in Singapore this October.

A decade of experience

L’Oréal’s digital strategy leverages over a decade of experience to enhance brand visibility and consumer engagement. The company focuses on offering unique brand experiences on its direct-to-consumer websites like La Roche-Posay’s AI-based Spotscan for personalised acne solutions.

Additionally, data is a critical asset for L’Oréal. In a cookie-less environment, their digital services provide high-quality data that helps drive traffic and conversions.

“We leverage on data for traffic and conversion and use these insights to be more responsive and compete better,” said Bradshaw-Zanger.

AI-driven tools, including the newly introduced Beauty Genius personal beauty assistant, further refine this approach by providing tailored recommendations and support.

Moreover, successful collaborations have also played a pivotal role in strengthening L’Oréal’s e-commerce presence. The acquisition of ModiFace in 2018, an augmented reality application, has been instrumental in delivering realistic virtual try-ons and skin analysis across various brands.

Looking ahead, L’Oréal plans to continue pioneering in Beauty Tech with innovations that are inclusive, personalised, and sustainable. Upcoming advancements include an AI-powered makeup applicator for those with limited motor skills a personalised lip color maker. Also, the group is focusing on sustainability with technologies like the Water Saver shower head and the AirLight Pro hair drying tool, which reduce water and energy consumption.