The beauty industry is undergoing a dynamic transformation in how consumers interact with brands. With digital and omnichannel touchpoints playing an increasingly critical role, beauty retailers are investing in personalization, AI, and enhanced customer service to meet rising expectations. Findings from the 2024 Omnichannel Retail Index (ORI) reveal how top brands are leading this evolution—and where opportunities still exist.
Personalization: A Key Differentiator in the Beauty Industry
Personalization continues to drive engagement and conversions. In 2024, 94% of benchmarked brands display recommended products on their Product Detail Pages (PDP), using prompts like "May We Suggest" or "Customers Also Viewed" to encourage cross-sells and relevance.
Despite this strong focus on personalization within PDPs, there is still untapped potential in other areas of the customer journey. For example, 47% of brands now offer personalized product recommendations to repeat visitors on their homepage, a slight increase from 45% in 2022. This is an area where more beauty retailers can step up their game, leveraging data to create tailored experiences for loyal customers and returning visitors.
Cart Recommendations and Order Confirmation Emails
Cart-based product suggestions are now offered by 81% of brands, up from 65% in 2018, streamlining the discovery of complementary products. Moreover, a newer trend in order confirmation emails is also gaining momentum, with 46% of retailers now showcasing product recommendations in these communications. This feature provides an additional touchpoint for beauty brands for engaging customers and encouraging repeat purchases post-purchase.
AI and Personalization
AI continues to transform personalization efforts across industries, and the beauty sector is no exception. According to the ORI, 82% of commerce organizations report at least moderate improvements in personalization efforts thanks to AI. For beauty brands, AI can help create highly personalized shopping experiences at scale, whether by recommending products based on a customer's previous purchases or offering search results that are customized to their preferences.
In fact, 49% of brands now use AI to remember and display shoppers' previous search terms, a significant leap from 29% in 2023, making discovery faster and more relevant.
Geolocation for Localized Experiences
Geolocation continues to play a pivotal role in personalizing the shopping experience. In 2024, 76% of benchmarked brands correctly geolocate users (vs. 45% in 2020). This enables beauty brands to tailor offers and store locations based on the customer's proximity, enhancing the relevance of their interactions.
AI-Driven Fit Tools
Generative AI and fit tools are helping shoppers visualize how beauty products might look or feel. As of 2023, 15% of brands offered a fit tool or product visualization, helping customers get a better sense of how the product would look on their skin, thus improving confidence and reducing returns.
Customer Service: Enhancing Support for Higher Conversions
Customer support remains key to conversion. In 2024, 39% of brands offered persistent customer service elements in the header of their websites, allowing customers to quickly access help as they browse. As generative AI continues to develop, chatbots are expected to become more advanced, offering quicker, more effective solutions to customers at any time of day.
Improved Customer Service at Checkout
In the checkout process, 66% of brands now provide easy access to customer service, whether via live chat, phone, or email. Easy access to customer service can also extend beyond traditional methods, such as offering SMS for order status updates, which 56% of brands now provide. This tactic can help beauty brands cut through the clutter of email and offer immediate, trackable updates to customers.
Looking Ahead
The 2024 ORI reveals that brands prioritizing AI, personalization, and seamless support are setting the pace in beauty retail. As the industry continues to evolve, staying agile and customer-focused will be key to sustained growth.
Stay tuned for the 2025 ORI report, where we’ll uncover the latest trends and innovations shaping the future of omnichannel retail in the beauty industry.
