Think back on an average day: maybe you used Uber to book a ride, brought yourself up to speed on Brexit with your personalised Apple newsfeed, or scrolled through Airbnb in search of this ski season’s ideal chalet.
We’re becoming accustomed to the idea of Silicon Valley redefining the way we communicate, work, travel, consume news and even think. But, still rarely I’m willing to bet, do we picture Silicon Valley moguls directly influencing the way we choose a new lipstick or apply our foundation each morning.
Yet rumblings about saturation in the overcrowded social media and app space have led Valleyites to seek new marketplaces, and the beauty industry is high on their list. Firstly, they are using biotechnological research to drive exceptional new formulations. Secondly, they are harnessing digital innovations to help sell make-up, skin and haircare in ways we could barely have imagined 10 years ago. And thirdly, they are investing heavily in individual brands.
What all of this adds up to is a sense that our online and offline worlds are merging, changing the way we see not only beauty products, but how we – literally – view ourselves. Thanks to ever-advancing digital capabilities, where once we had an exclusive relationship with our reflection in the mirror, increasingly our judgement is based on interacting with virtual-reality versions of ourselves on screen. Welcome to the age of phygital beauty.
“Silicon Valley is spearheading a radical realignment of the beauty landscape,” says Victoria Buchanan, strategic researcher at The Future Laboratory. “The value chain for beauty had remained static for a hundred years, operating within the same retail model, whereby brands dictated to women what they needed. Now, just as other e-tail industries have had to adapt to an increasingly autonomous, technology-savvy consumer, so too the beauty sector is learning that, with the power of constant online feedback, it needs a new way of putting the consumer at the heart of brand and product development.”
The benefits of being part of the Silicon Valley zip code mean that where once brands might have sought investment and technologists and scientists from different places all around the world, now those various resources can often be found within close proximity. So that whatever and whoever one needs – whether it be a molecular biologist, the world’s leading dermatologists, holographers, tech engineers or e-commerce platform developers – the Bay has the solution.
Take Algenist, a brand that in 2011 aped the movements of a typical tech startup, choosing to base itself in Silicon Valley where it partnered with biotechnologists from Stanford University. Thanks to the university’s research into an alternative source of jet fuel used by United Airlines, Algenist was able to patent an active skincare ingredient previously unseen in the beauty industry. “Our location in south San Francisco – the birthplace of biotechnology – directly gave rise to the discovery and development of Algenist’s proprietary ingredient alguronic acid,” says Tammy Yaiser, vice president of product development. “Alguronic acid comes from the oil of one particular species of microalgae previously used in fuel. We adapted the technology for our Genius Liquid Collagen (£90 for 100ml), which delivers exceptional skin-hydrating benefits via the microalgae’s unusually high concentration of oleic acid, phytosterols and vitamin E. We’ve found it to boost cellular regeneration by 55 per cent, thereby outperforming other commonly used ingredients.” Certainly, the aerated, jelly-like texture feels unusual to the touch, but it glides onto the skin, absorbs rapidly and does make it appear smoother and plumper after a couple of weeks.
So, too, Biossance (whose parent company is Amyris, which began life as a Silicon Valley startup) is producing squalane for skincare from a renewable, eco-friendly and plant-based source thanks to bio-engineering. By using sugar-fed yeast to manufacture squalane on a wholesale level and combining it with familiar skincare ingredients such as vitamin C, it has produced products such as Squalane + Peptide Eye Gel ($54 for 15ml) –apparently so reliable for reducing dark circles and fine lines it sells out on the Sephora beauty website.
Yet as Zoe Leavitt, senior analyst for tech market intelligence platform CB Insights, sees it, the influence of Silicon Valley extends far beyond the actual formulation of beauty products. “Silicon Valley has changed the way that consumers discover, buy, apply and review them,” she explains. “This reflects changes in consumer tastes and means that their expectations of the beauty industry are now higher than ever.”
As with so many other sectors, if brands are to retain the competitive edge, they must now make buying a product online an experience, rather than a simple exchange of goods for money. Virtual and augmented reality provide the perfect solutions.
When launching her first perfume, Scent of A Dream, last year, Charlotte Tilbury couldn’t bring her coterie of famous friends to her customers – so she brought them Kate Moss, by means of a VR campaign video, available online and in store. This tech-centric approach caught the eye of Silicon Valley-based venture capitalists Sequoia Capital, whose portfolio includes WhatsApp, Yahoo and Google. Of the 500 or so pitches Sequoia hears each month, rarely are more than two actually funded. Yet in April this year, Tilbury was one of those few successful candidates, receiving an undisclosed amount to scale the brand globally. As a British-born brand that has quickly become one of the most well-known in its home marketplace, I suspect few of its fans would associate it with the culture or funding of Silicon Valley. Yet the benefits are mutual – from Sequoia’s perspective, to its list of traditional tech investments it adds the glamour of a beauty label and a founder who is well connected in the fashion and celebrity worlds.
For Tilbury’s part, the brand has just opened its first store in Kuwait, complete with an augmented reality Magic Mirror that combines real-time facial tracking and skin-tone detection to allow customers to “try on” her 10 signature looks. Another store opened in Doha in October and another will be launching in Dubai in early 2018.
Tilbury’s is by no means the only beauty brand to find Silicon Valley knocking on its door, signifying that beauty is entering an unprecedented era, says Leavitt. “Historically, beauty has sat in the arena of private equity rather than venture capital, which tended to shy away from consumer goods startups in the belief that they scale less quickly than those of software companies. Now, though, recent success stories are drawing more venture capital firms into the space.”
Victoria Buchanan cites American brand Glossier – a beauty and make-up line launched in 2014 by Emily Weiss, founder of website and blog Into The Gloss – as a case in point. The brand’s $24m Series B investment led by IVP of Silicon Valley (whose portfolio also includes Twitter, Snap and Coinbase) is, says Buchanan, a sign that investors are increasingly attracted to a direct-to-consumer beauty model. “Being digitally native, with more than two million people reading and commenting on our content each month allows us to maintain a one-to-one relationship with our Glossier customer,” says Weiss. “The fact that she buys directly from our site means we know if she’s a frequent Boy Brow Mascara (£14) purchaser, or prefers the Priming Moisturizer (£18 for 50ml), so we can tailor our editorial content to her interests accordingly.” The result is a self-perpetuating cycle of growth as blog and product line feed off one another.
And just as it crowd-sources ideas for existing products, Glossier is now developing its first candle with the help of readers, who have posted around 700 comments about their desired scent. According to Weiss, the process is indicative of a shift in the relationship between brands and consumers. “Where once brands were the experts, now we recognise that every consumer is her own expert,” she says.
So much is technology encouraging beauty brands to both empower and serve women better that even the big-name global beauty houses are now looking to Silicon Valley to help them innovate and remain relevant. The beauty sector has struggled with how to reconcile consumers’ preference for quick online purchases with the need to convey the shades, scent and tactile nature of their products – everything women can experience in a bricks-and-mortar retail setting. To an extent, digital innovation has overcome these issues by delivering convenience, a far greater degree of product personalisation and a means by which brands can educate us remotely, says Ophelia Ceradini, vice president of digital innovation and technology at Estée Lauder.
She points to the particular success they’ve had with Crème de la Mer, which has recently launched its Genaissance de la Mer The Eye and Expression Cream (£225 for 15ml), complete with a skin-cooling application tool, which together help revolumise fine lines around the eyes and mouth. “We have an online video tutorial to show people how to apply the eye cream and use the massaging applicator and we’ve developed a Facebook Messenger chatbot to help customers choose and layer products to maximise their benefits,” says Ceradini. “We can also direct customers to a live chat with a skin expert if they wish.” All this from the comfort of your desk, hotel room, or even that Airbnb ski chalet.
The convenience for today’s time-challenged consumer doesn’t stop there. Professor Parham Aarabi who obtained his PhD at Stanford University, which is widely regarded as being the – sometimes controversial – global epicentre of facial recognition technology, has developed ModiFace Try-On Studio, an augmented-reality experience adapted for the beauty industry. Estée Lauder was quick to partner with Parham, whose technology allows women to experiment with the multiple shades and matte, chrome, shimmer or cream finishes in its Pure Color Love Lipstick range (£19) without trekking around a shop, or having to wipe each one off in between. Again, the benefits are mutual: brands that use the technology, such as Estée Lauder and Smashbox, see a conversion rate in terms of sales of up to 80 per cent – because the more we “try” virtually, the more we’re likely to buy in reality.
At this point, a link to Brad Pitt might seem tenuous – but bear with me: the technology used to reverse his character’s age in The Curious Case of Benjamin Button is the very same you’ll find in Makeup Genius, L’Oréal’s answer to a platform that lets you virtually try before you buy. The sophistication of its experience has attracted 20 million customer downloads – yet is just one tech-driven solution emerging from a wider-reaching initiative: in 2012, L’Oréal announced its new Research and Innovation Technology Incubator, a startup-like environment armed with access to its global resources, as well as expertise from local universities and hard and software engineers located in the Bay area. Already, it has produced Lancôme Le Teint Particulier Foundation (£85 for 30ml) where an in-store “beauty advisor” scans one’s skin tone using a proprietary algorithm developed in the Technology Incubator. The scanner processes the data and blends a personalised formula. The promise is a shade that “fits” your skin tone, providing a far closer match than a product you might once have bought off the shelf.
“Looking to the future, we’re exploring how machine learning and AI can bring ever more personalised products and exciting tech-enabled experiences to our beauty consumers. There is so much opportunity – this is an exciting time for the industry,” says Guive Balooch, global vice president of the Technology Incubator.
So it seems that the Silicon Valley sky really is the limit. Maybe one day soon, we’ll hail driverless taxis. Maybe our wardrobes will intelligently order pieces from the Céline catwalk. Maybe there will even be an app that does our make-up and brushes our hair for us. Whatever the future holds, our human and digital lives are merging and the beauty industry is pelting full speed ahead into that space.