Technologies Adopted by Beauty Retail: Technically Beautiful

TOP15
TECHNOLOGIES
Adopted by
BEAUTY RETAIL
April 30, 2015
TECHNICALLY BEAUTIFUL
• As with just about every industry these days, beauty has become digitized, and beauty is surprisingly
amenable to digital technologies
• Beauty, technology, and science are colliding and cross-‐pollinating, as technologies from diverse
industries are advancing beauty
• As the smartphone has become the hub of our digital lives, it has also become our personal beauty
consultant and beauty counter
• Consumers are taking control of their own beauty regimens, ordering at-‐home services, purchasing
subscriptions, using at-‐home beauty devices, and just printing them with 3D printers
D EBO RA H W EI N S WI G
Ex e c uti ve D ir ec to r – H ea d of G lo ba l Re tai l & Tec h n o log y
Fu n g Bus i n es s I n tel li g en c e C en tr e
d ebo ra h we in s w ig @ f un g 19 37. c om N e w Y or k : 64 6. 83 9.7 017
Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

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Copyright © 2015 The Fung Group, All rights reserved.
Table of content
Executive Summary
Global Beauty Market Overview
Part I. Convergence of Beauty and Visual Media
1. Facial Mapping
2. Magic Mirrors
3. Magic Mirror Displays for Shopper Engagement
4. Color Matching Goes High-Tech
Part II. Digital Beauty Lifestyle
5. Smartphones Double as Personal Beauty Consultants

6. Social Selling Beats Online Ads for Beauty Products
7. Subscription Models
8. At-home Beauty Devices Gain in Popularity
Part III. Convergence of Science, Medicine and Beauty
9. Genetic Testing for Customized Treatments

10. Biotech Invades Beauty
11. Medical Tech in Beauty
Part IV. The Future Is Here
12. Wearable Tech in Nail Art and Makeup

13. 3-D Printing of Cosmetics
14. Organic and Environmentally Friendly Products
15. On-Demand Beauty Services
Conclusion

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April 30, 2015
Executive Summary
As with just about every industry these days, beauty has
become digitized. The meaning here is not that beauty is
binary, represented with a one or a zero, but rather that it
has incorporated and, hopefully, become enhanced via digital
devices and processing methods. Beauty is surprisingly App
amenable to digitization, even though on the surface, there
seems to be little overlap between the worlds of tech gurus
and beauty mavens. A deeper analysis reveals that the
beauty industry actually depends on many technologies. It’s
highly visual, and the digital realm enables the easy Au gmented
Displays
recording, cataloging and manipulation of vast numbers of Reality
images. Beauty products also depend on chemistry and
biochemistry, areas that are hotbeds of scientific advance.
And, perhaps most important, the beauty industry relies on
fantasy and imagination, and digital tools are our primary means today for imaging new fantasy worlds
replete with stunning, beautiful objects. In
this report, we outline 15 technologies that
are driving the robust growth of the beauty
market, in sharp contrast to other retail
segments, which are showing slow growth or
none at all. Based on data from Statistica,
FBIC Global Research & Tech estimates that
the global digital beauty market is about
US$50 billion this year and growing about
20% annually.
A second key topic here is convergence, also
known as synergy or blurred lines. Beauty
and technology and science are colliding and
cross-‐pollinating. Facial-‐mapping technology
used in facial recognition in casinos and law
enforcement has been incorporated by the beauty industry, along with image-‐processing and virtual
reality technology from the PC and gaming worlds. Computer
graphics tools from graphic arts such as color matching have
been adapted to the artistic sensibilities of the beauty
industry enabling the creation of magic mirrors that PC S
transform the way we look and allow us to try on clothing or
makeup virtually as well as street-‐side magic displays that
can interact with us as we pass by.
We love our smartphones, and they’ve become the essential
hub of our digital lives—we use them to shop, make BEAU TY GAMING
reservations and serve as our virtual offices, as well as
provide entertainment. So, it’s logical that they would also
double as our personal beauty consultants, enabling us to
try on products, visualize ourselves wearing them in real
time and, ultimately, purchase them. As social networks have created new trends and celebrities
overnight, they’ve also become the medium for determining the success of cosmetic brands, creating
megabrands virtually overnight, and social selling has become a sales channel of its own. Retailing has
benefited greatly from gamification, the adoption of methods and elements from the computer gaming
world, and these elements are increasingly being used in retail and in marketing beauty products. With
our smartphones, we no longer have to suffer the inconvenience of going to the store or mall, and a

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April 30, 2015

multitude of businesses employing subscription models have
sprouted up, enabling us to place regular orders for everyday
or even embarrassing or intimate items to be delivered to our
homes. We can also schedule on-‐demand beauty services
SCIENCE from our mobile device.
Decades of research in the biotech field, the medical field,
and the sports medicine industries have resulted in
compounds and techniques that have found new applications
in beauty. These include products that have been customized
BEAU TY TECHNOLOGY and personalized using genetic testing for optimal
performance and to avoid allergy irritation, and others that
make our skin smoother and minimize wrinkles to make us
appear younger. At-‐home beauty devices help us to improve
our appearance without having to take a trip to a doctor’s or
beautician’s office.
Finally, other areas of science and technology have permeated beauty. Consumer consciousness regarding
what we put into our bodies has made the natural transition to what we put on our bodies, and several
companies have emerged to offer organic and environmentally friendly products. Technologies
previously seen only in Star Trek episodes have migrated to beauty. We can now sport wearable
technology on our faces and bodies to make us more beautiful, and if a store is out of a particular color of
makeup, we can just replicate our desired shade (using the correct Pantone color number) and perform
3D printing of nail art and makeup with our trusty 3-‐D printer. It’s a brave new world for beauty, fueled
by technology, and we’re just getting started!
Global Beauty Market Overview

According to L’Oréal, the global beauty market was worth approximately $239 billion in 2014 (€180
billion) and grew at a 3.8% compound annual growth rate from 2004 through 2014. FBIC Global Retail &
Technology estimates that the retail market is actually worth almost twice as much, about $480 billion.
Figure 1. Global Beauty Market (Millions)

300
EUR Converted to USD
250 $239
$231
$223
$213 $215
$204 $203
$193
200
€174 €180
$169 €167
$154 $159 €160
€147 €153
150 €141 €145
€135
€124 €128
100
50
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Source: L’Oréal and OANDA.com

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April 30, 2015

The Asia-‐Pacific region is the largest beauty market—it constituted 35% of the global market in 2014. It
was also the fastest-‐growing market last year, up 9.6%. Western Europe and North America are roughly
similar in size, and they represented 22% and 21% of the beauty market, respectively, in 2014. Latin
America accounted for 13% of the global market in 2014, while Eastern Europe represented 7%, and
declined by 7.8% during the year. Africa and the Middle East represented less than 3% of the global
market and grew by 3.6% in 2014.

Figure 2. 2014 Beauty Market: Geographical Breakdown
3%
Asia-‐Paciﬁc
7%
Western Europe
13% 35%
North America
Lagn America
21% Eastern Europe
22% Africa, Middle East

Source: L’Oreal
Skincare was the largest beauty category in 2014, representing 35% of the industry total, or $84.3 billion.
Haircare was the second-‐largest category, at 23%, or nearly $55 billion. Makeup represented about 17%
of the 2014 market, or nearly $40 billion, and fragrances nearly 13%, or about $31 billion. Finally, hygiene
products and other categories represented 11% and 1% (nearly $26 and $3 billion) of the market,
respectively.

Figure 3. 2014 Beauty Market: Breakdown by Product
1% Skincare
11% Haircare
Make-‐up
35%
13%
Fragrances
Hygiene Products
Other
17%
23%

Source: L’Oreal

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April 30, 2015
PART I – CONVERGENCE OF BEAUTY AND VISUAL MEDIA

1. Facial Mapping
Although facial recognition has well-‐publicized uses in casino
security and law enforcement, the technology is increasingly being
used in beauty, medicine and even finance. In the scientific arena,
there has been a great deal of research devoted to beauty and the
modeling and rendering of realistic-‐appearing clothing, human hair
and skin texture (including wrinkles). In beauty, facial modeling and
simulation have largely been used for virtual makeovers and to allow
users to virtually “try on” products.
Virtual Makeovers and Try-‐Ons
The main application for facial mapping and simulation is to model
the appearance of various cosmetics, which eliminates the need for
an often messy and unhygienic situation at the department store counter. Software that allows such
modeling has been developed for smartphones, tablets, web browsers and dedicated beauty appliances.
ModiFace is a Toronto-‐based
company with a background in
building 2-‐D and 3-‐D facial
simulations for cosmetic surgeons.
It claims that its technology is used
in more than 150 web and mobile
apps that have been downloaded
more than 50 million times. The
company sells a complete Mirror
package, including an iPad loaded
with its software, for $2,000.
In 2013, ModiFace launched the
Vogue Makeup Simulation iPhone
app in Japan. The app enables the
user to try on hundreds of cosmetic
products from popular brands that include ADDICTION, Chicca, Clinique, Estée Lauder, RMK, Shiseido and
Shu Uemura. Once the user is done with her makeover, she can purchase products on her phone or share
the results via Facebook, Twitter or email.
L’Oréal Makeup Genius, launched
in June 2014, is a free virtual-‐
makeup-‐testing app for iOS
devices that enables users to try
on and buy various combinations
of makeup as well as the curated
looks of selected celebrities. The
app was developed in conjunction
with Image Metrics, a developer
of facial-‐recognition software for
video games.

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Facial mapping and augmented reality have been used in haircare and nailcare as well. For its Matrix
brand, L’Oréal teamed up with Google Glass (which is currently on hiatus) to provide in-‐depth hair-‐styling
tutorials offered from the stylist’s point
of view. Colorist Madison Reed offers a
voice-‐operated virtual reality app that
lets users shop for the best hair color and
guides them through the process of
either touching up their gray hair or
performing a salon-‐quality coloring.
And Maybelline created a demo with the
makers of UK-‐based image-‐recognition
and augmented reality app Blippar. With
it, consumers can take a photo of their
own nails, decorated with Maybelline’s
Color Show Nail Lacquer, and then upload
the images to social media networks,
including Pinterest, Facebook and
Twitter.

2. Magic Mirrors
The magic mirror started as an
augmented reality tool that shoppers
could use to virtually try on different
clothing items; the mirror was outfitted
with sensors that enabled a motion-‐
triggered virtual change of clothing.
When the customer moved her arm,
she would see a new shirt or pair of
pants superimposed over her own live
image. Product information was fed
into the mirror from a linked tablet that
the customer could then use to swipe
through color palettes, share new looks
with friends and even make a purchase.
Retailers have been experimenting with magic mirror technologies since 2010, when Macy’s rolled out its
smart dressing room. Body-‐scanning and measurement devices—such as Me-‐Ality, which can create user
profiles for better-‐fitting clothes but requires a scanning machine, and Styku, which created a portable 3-‐
D body-‐scanning platform—have been interesting on a designer level, but not easily adopted for
consumer use. However, the basic technology has spurred the development of enhanced smart mirrors,
such as Intel’s Magic Mirror, which takes 360-‐degree video and provides sizing data. It’s being rolled out
in a pilot program with Neiman Marcus. Another interesting application that’s sure to gain traction for a
multitude of uses is facial recognition. ActiMirror is a magic mirror that employs facial recognition by
analyzing 25 facial features to determine age, gender and ethnicity.
Magic mirrors’ uses range from driving fashion to enhancing the fitting-‐room experience. The ultimate
goal is to provide the customer with a fully integrated retail experience while giving the retailer and brand
the ability to pull and track data, expand their customer loyalty programs and better monitor inventory.

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The applications for this technology have evolved
over the last few years, with today’s key uses being:
1. Attracting customers with visual suggestions
and options for complementary fashion, style,
wardrobe or makeup.
2. Expediting the fitting-‐room process and
providing a hassle-‐free experience, enabling
better customer-‐associate interactions.
3. Theft protection (in the case of RFID-‐tagged
items) and inventory tracking and
management.
4. Data collection (the most important thing on
this list), expanding loyalty programs, tracking
sales and enabling social media sharing.
While there are many variations in the application of
this technology, most products that use it can be
grouped into one of two categories: magic mirror
displays and fitting-‐room enhancements. Some
crossover does exist, based on a brand’s customized
user experience.
3. Magic Displays for Shopper Engagement

In order to compete with Internet retailers, brick-‐and-‐mortar retailers must make the shopping
experience more entertaining. While retail shops have always created interesting window displays, they
now can use existing large-‐panel LED displays and new 3-‐D motion detection and/or RFID technologies to
create immersive, interactive experiences. Large-‐scale displays have been available for several years, and
prices have come down steadily, making large panels and custom displays more affordable.
Moreover, 3-‐D motion detection has moved into the consumer sphere. Examples include Microsoft’s
Kinect technology for gaming and Intel’s new RealSense 3-‐D camera technology, which was announced at
the Consumer Electronics Show in January 2015. LEGO installed a large display in Chicago that used a
Microsoft Kinect sensor to sense the movements of passersby, in effect creating a large video game in
which people can participate. By offering a free game, LEGO is reinforcing the idea of the store being a
place for fun, rather than just a place for a dry shopping experience.
Bloomingdale’s installed a series of large
LCD screens combined with cameras,
each associated with a different designer
(Marc Jacobs, FENDI, Roberto Cavalli,
Miu Miu or Gucci), that let passersby
virtually try on pairs of that designer’s
sunglasses. The shopper positions
himself in front of the sunglasses. If he
likes the glasses’ appearance, he can hit
the “print” button, and then pick up the
printout at the Sunglass Style Bar, where
he can try on the actual sunglasses
before buying them.


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BMW worked with Google’s
Creative Sandbox to design a
display in which all passing
vehicles along 6th Avenue in
Manhattan were transformed
into either a BMW i3 or i8.

In its FuelStation interactive
store in London, Nike used
Kinect to enable shoppers to
create a game where they
jump up and down and can
receive an email with a 30-‐
second video clip.

4. Color Matching Goes High-Tech

Sephora teamed up with color specialist Pantone to create Color IQ, a
handheld device that captures color-‐pitch intensity. By focusing on skin
physiology, Color IQ eliminates variables that distort shade selection.
Unlike traditional cameras that require ambient light to take pictures, this
handheld device takes pictures in darkness. The technology allows the
picture to focus on the true skin color and avoid color distortion by light.
After they are assigned a color IQ number, which captures skin’s surface
tone and undertone after the scan, customers can find a selection of
precise foundation products. Pantone’s CAPSURE cosmetic color devices
can download, store and retrieve color information instantly. They can be
charged via a USB interface and carried by beauty consultants inside a
store.
The Pantone Color Institute has mapped out 110 skin tones for its Color IQ
library. Capturing skin tones and undertones, Color IQ also supports
improved foundation matching. It’s only a matter of time before this
functionality is applied to create colored cosmetics that complement skin
tones and apparel choices.
For shoppers who don’t have time to go to a store, IMAN Cosmetics has developed an app that
determines one’s “color signature” after taking a headshot. The app uses color-‐matching technology to
analyze the color of eyes, hair, skin and lips. After an analysis, the app offers a wide range of product and
look recommendations.

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PART II—DIGITAL BEAUTY LIFESTYLE

5. Smartphones Double as Personal Beauty Consultants
Smartphone apps today are capable of conducting skin analysis, making product recommendations and
performing virtual cosmetic testing. Using facial-‐mapping technology, the new L’Oréal Paris Makeup
Genius app turns a smartphone into a magic mirror. The app allows customers to see L’Oréal products and
view them in video in real time. This technology is a step
forward from previous makeup simulators that displayed
products on static pictures. The Makeup Genius app draws on
a patented tracking algorithm system that enables precise
facial recognition via a live mirror camera. It can capture 64
facial points and up to 100 expressions while tracking head
movements of up to 60 degrees.
The beauty magazine Allure teamed up with developer
SkinBetter to create an app that applies dermatologist-‐grade
scanning technology to identify skin issues. The results are
available within seconds. After personal skin analysis, the
mobile app recommends skin products based on the
individual’s needs.
6. Social Selling Beats Online Ads for Beauty Products

According to Google, 50% of beauty shoppers rely on beauty videos on YouTube when making a purchase.
YouTube has helped to establish the brands of beauty content creators, including Michelle Phan’s. E-‐tailers
provide beauty products to website owners in exchange for links to their website. Both traffic and
conversion rates improved after the establishment of this partnership with YouTube: the site generated
40% of traffic from YouTube links and conversion rates increased to 15%.
User-‐generated content is also more
effective than brand-‐owned channels.
L’Oréal-‐owned brand NYX has generated
1.5 million views on its own channel, but
2.1 billion views from trend influencers’
content on YouTube. And beauty
companies are keeping an eye on
celebrities’ personal social media posts,
which can boost a brand’s visibility
mightily. According to L2, Estée Lauder’s
video of model Kendall Jenner received
only 7,000 likes on the company’s
website, but more than 429,000 likes on Jenner’s personal Instagram page. A video of L’Oréal ambassador
Barbara Palvin received twice as many likes on her own Instagram page as it did on L’Oréal’s timeline.
Social media is the ultimate platform for interacting with customers. In South Korea, where smartphone
penetration has reached 70%, local beauty brands are extremely savvy about social media. South Korean
cosmetic brand Tony Moly held a Facebook contest for user-‐generated content that spurred page view
growth of 631% year over year. Another South Korean brand, Etude House, garnered 23 million views on
its YouTube channel. And THEFACESHOP created an entire beauty community on the South Korean
messaging app KakaoTalk that featured new products, beauty quizzes and invitations for fans to test
products.


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Social media is also revolutionizing our perception of beauty. A survey by Dove showed that women
between the ages of 18 and 64 are much more likely to obtain beauty inspiration from social media. The
same study revealed that the vast majority (82%) of women believe that social media is changing
standards of beauty.
A series of bloggers have challenged orthodox beauty standards. Lizzie Velasquez has a rare genetic
disorder and weighs only 64 pounds. After finding herself in a video titled The World’s Ugliest Woman, she
created her own YouTube channel about beauty and body positivity. Chantelle Winnie is a model with a
discoloring skin condition. Her Instagram account features professional photos that show her natural skin.
7. Subscription Models
While we have long been familiar with newspaper and magazine subscriptions and companies such as the
Book-‐of-‐the-‐Month Club, after some initial false starts during the dot-‐com boom, the Internet is now
enabling a new category of subscription businesses. These businesses offer consumers exceptional
convenience, variety and the thrill of discovery. While the largest categories of subscriptions are food,
apparel, beauty products, and pet treats and toys, there are an infinite number of things that can be
subscribed to, including works of art, fishing tackle, razor blades and even jewelry rental.
Consumers find value in avoiding the
drudgery of shopping for everyday
commodity items and items that are
potentially embarrassing to purchase.
They also appreciate the benefits of
curation and that the value of the
items received can exceed their total
sale prices. Many celebrities have
jumped on the curation bandwagon,
and it’s possible to receive a monthly
package of items personally selected
by your favorite actor or recording
artist. Finally, most people like
presents and surprises, and many
consumers use subscriptions to treat
themselves to a monthly gift.
Technology also comes into play with subscription services, since software enables consumers to delay,
modify, or scale up or down their orders. And since subscription businesses are scalable, i.e., they can be
started from one’s living room, they have very low overhead. Although privacy and security remain
concerns—as with all e-‐commerce—the online subscription industry has grown to more than $3 billion in
sales, and venture capitalists have invested more than $500 million to gain a foothold in this growing
sector.
There are also other business models that are part of the
subscription ecosystem, such as websites for managing or
curating subscription businesses (one website alone lists
more than 950 subscription businesses) and software that
helps manage these businesses. The success and appeal of
subscriptions has not eluded big Internet retailers such as
Amazon and brick-‐and-‐mortar retailers such as Sam’s Club
and Target. They are all offering their own monthly
subscriptions, which provide a discount that offsets the
acquisition cost of new orders. For those too lazy to fire up
their web browser or smartphone to place an order, Amazon recently announced its Dash Button—a one-‐
button, branded electronic device that connects through a home Wi-‐Fi network to let consumers reorder
beverages, cleaning supplies and razor blades.

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8. At-home Beauty Devices Gain in Popularity
Home beauty devices are expected to be a key growth area in the
future. In terms of product categories, hair removal devices account
for one-‐third of the total beauty device market, followed by a tie
between cleansing and antiaging devices. As with other beauty
products, the US leads the beauty device market, but Asia is rapidly
catching up. In 2013, China posted 92.6% year-‐over-‐year growth in the
category. With Clinique set to enter the market with its Sonic System
Purifying Cleansing Brush, competitors are expected to follow suit.
Europe’s growth in the at-‐home beauty sector is poised to outpace
that of the US, with a 25% sales increase. The European market grew at
a steady 14% in 2014, with LED face masks, skin-‐smoothing lasers and
microdermabrasion products proving some of the most frequent
purchases.
PART III—CONVERGENCE OF SCIENCE, MEDICINE AND BEAUTY

9. Genetic Testing for Customized Treatments
According to a 2014 survey by UK market research firm Canadean,
45% of UK adults said they are interested in a scientific approach
to personal skincare. Technology has enabled consumers to obtain
tailored antiaging products based on DNA analysis. Beauty
technology brand Geneu recently launched a skincare lab in
London that offers skin profiles based on a DNA sample from a
simple mouth swab. Within 30 minutes, the lab produces a profile
detailing collagen breakdown, antioxidant protection levels and
skin reaction to damaging free radicals.
In the near future, customers will understand their exact skincare
needs and be able to select products that are right for them.
Information transparency demands hypercustomization from
beauty brands. French brand oOlution offers four products that
are adjustable to the daily changing needs of an individual’s skin.
According to Mintel, 29% of French women have expressed an interest in buying customized hair products
designed specifically for their own hair needs. One company seeking to meet this demand is British brand
Concoction, which says it is offering the world’s first customizable shampoo. French luxury brand Clarins
now offers a made-‐to-‐measure self-‐tanner: its Radiance Plus Golden Glow Booster lets users drop varying
amounts of the product into a regular day or night cream.
10. Biotech Invades Beauty

The line between medical research and beauty is blurring, as major cosmetics companies have begun to
use biotech materials, genetic profiling and stem-‐cell-‐based products and therapies for cosmetic
purposes, antiaging remedies in particular. In addition, biotech companies are increasingly licensing
methods for repairing DNA and healing wounds to the cosmetics industry. One major benefit for the
biotech companies is that cosmetic products do not have to undergo clinical trials, as drugs do, which
makes them much cheaper to develop. Cosmetics manufacturers also want to avoid time-‐consuming and
expensive regulatory processes such as US Food and Drug Administration approval.
At the same time, consumers have become more scientifically literate than they were a few decades ago
and, consequently, scientific terms such as “peptides,” “proteins” and “growth factors” are increasingly
being used to market beauty products. Many cosmetics companies are using compounds from other areas
of medicine, such as growth factors and wound-‐healing compounds, for antiaging and antiwrinkle
treatments.
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Enter the Cosmeceutical
“Cosmeceutical” is a fusion of
“cosmetic” and “pharmaceutical”
and refers to cosmetic products that
offer benefits similar to those of
drugs. These products are typically
moisturizers and antiaging creams.
Being able to offer pharmaceutical-‐
style benefits over the counter is
attractive for cosmetics makers, as
they can demand premium prices
there for these products.

11. Medical Tech in Beauty

Vaccinations can be delivered via microneedles, which are constructed from and deliver medicine using a
type of acid. Japanese brands Shiseido and MTG have used these minuscule needles to deliver product
deep into the skin. The beauty-‐essence liquid and eye patches developed by BIGENDO also deliver
wrinkle-‐targeting ingredients deep into the skin.
Using induced pluripotent stem cells, it’s now possible to reduce the apparent age of skin by decades.
Kose Corp. is at the forefront of this field, and products incorporating stem-‐cell technology are expected
to be out on the market within five years.
PART IV—THE FUTURE IS HERE

12. Wearable Tech in Nail Art and Makeup
Wearable technology today primarily involves apparel and jewelry, but research is being done on
wearable applications for the beauty industry. Early areas of research include nail decoration, tattoos and
conductive makeup as well as combining beauty and technology to empower the disabled.
Nail decoration: Katia Vega, a PhD candidate in
computer science in Brazil, has combined nail
decorations with RFID tags, one for each finger. The
RFID tags are effective at distances of slightly less
than an inch (two centimeters) and can be used for a
variety of functions, such as opening doors.
Moreover, the system can recognize combinations of
actions, such as snapping one’s fingers. In a recent
demonstration, Vega used her RFID-‐augmented nails
to control the mixing of more than 25 music tracks,
with her hands at the bottom of a pan of water.
Tattoos: Engineers and scientists are hard at work developing flexible, thin circuits that can adhere to the
skin like a Band-‐Aid. These circuits can contain sensors and conductors that accommodate both function
and fashion. For example, startup MC10 is developing smart cosmetic stickers that can alert the wearer’s
cellphone when it’s time to reapply sunscreen, measure and report on the skin’s properties, and
recommend a suitable moisturizer.

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Conductive makeup: Katia Vega is also a pioneer in
conceiving wearable makeup and eyelashes. She has
developed an electrically conductive eyeliner and false
eyelashes that transform normal eye and facial
movements into actions that can be used to control
devices. In Vega’s setup, the eyelashes and eyeliner
function like switches, and a user’s blink can trigger a
microcontroller that performs functions such as
turning on a light, changing a TV channel or even
controlling a drone.
Helping the disabled: Adapting technology that can be
controlled by blinking or eye movements into tools
that can empower the disabled is a logical next step. Vega developed a wearable device called Blinklifier
that transforms eye movements into visual compositions. Another of her technologies is Winkymote, a
remote control designed for quadriplegics that acts as a smart IR remote and can control TVs,
smartphones, keyboards and other devices.
13. 3-D Printing of Cosmetics

The boom in 3-‐D printing has enabled consumers and ordinary people to design and fabricate their own
customized, personalized objects. Innovation in the world of 3-‐D printing is continuing, and printers are
being designed that use all kinds of materials as inputs (such as paper) and are able to print all types of
objects, including food. And the day is coming when we can print our own clothing. With the huge
advances in customization available through 3-‐D printing, it was inevitable that the technology would be
adapted for cosmetics solutions. For example, many women of color complain that mainstream cosmetics
were not designed for them and therefore do not enhance their beauty; 3-‐D printing potentially offers an
ideal solution to their needs.
One startup, Mink, has taken on this
challenge. The company has been
developing a desktop printer with a
sub-‐$200 price tag that can print
makeup such as lipstick, lip gloss, eye
shadow, blush, nail polish and brow
powder. Future versions will print
foundation and face powder. The
company claims the printer can turn
any camera, phone or laptop into a makeup printing station. It’s targeted to women ages 13 to 21 who
have not yet developed firm brand loyalty. The launch was initially scheduled for late 2014; the printer is
currently available only through invitation.
Do-‐it-‐yourselfers can print lipsticks, eye shadows and nail polishes at home using a home printer such as
the HP Officejet 6100, a graphics tool such as Adobe Photoshop, refillable ink cartridges, edible and
vegetable-‐based ink, and blank/white cosmetics.
14. Organic and Environmentally Friendly Products

As consumers have become increasingly concerned about chemical additives in their food, they’ve also
turned their attention to additives in their beauty products. Several studies published around 2000
showed that there were several chemical ingredients in makeup, shampoo, skin lotion and nail polish that
lacked safety data, and that some of the chemicals were linked to studies showing birth defects and
fertility problems. Consumer alertness and activity has therefore increased, leading to demand for organic
and chemical-‐free beauty products. Websites such as the Environmental Working Group’s Skin Deep have
emerged. These sites list products and their ingredients and rate them by their overall danger level,
cancer-‐causing ability, toxicity, propensity for causing allergic and immunotoxic reactions, and restrictions
on their use by specific groups.

14

April 30, 2015

There are also environmental concerns surrounding the packaging of cosmetic products. First, there’s the
waste aspect: Resource magazine claims that 23,000 tons of toothbrushes and 2 billion disposable razors
end up in US landfills every year. Euromonitor estimated that the cosmetics industry sold 210.8 billion
packaging units in 2008, all of which had to be disposed of. This packaging does not include unused
product that’s discarded for various reasons. While the cosmetics industry has been slow to consider the
environmental impact of packaging, some brands have made an effort to minimize their footprints. For
example, Aveda is using post-‐consumer recycled plastic and Lush is attempting to minimize the amount of
packaging it uses. The industry is considering refillable packaging, though that presents health and
logistical challenges. And some Internet e-‐commerce sites such as The Honest Company (backed by
actress Jessica Alba) offer subscriptions and sales of products with packaging that’s organic, natural and
environmentally friendly.
15. On-Demand Beauty Services

Mobile apps enable beauty services providers to offer their treatments anywhere, anytime. The US app
Beautified allows users to search for nearby salons and book last-‐minute appointments using geolocation-‐
based technology. It was launched in New York, Los Angeles and San Francisco. American beauty-‐delivery-‐
service company Vênsette is the Uber of beauty services. After a user answers a few questions about
makeup and hairstyle inspirations on Vênsette’s website or mobile app, the company sends a professional
stylist to the user’s home or office within a few hours.

15

April 30, 2015
Conclusion
The universes of science, technology and beauty are merging, in part because many technologies used in
these areas have been moving in similar directions for years. Specifically, technologies used in the PC,
display, gaming and mobile segments have turned out to be ideal for manipulating and displaying
fantastic (as well as real) images of beauty and putting them into our smartphones. At the same time,
technologies from drug discovery, healthcare and sports medicine have also found broad applications in
beauty. Finally, concepts previously imaginable only in science fiction, such as replication and wearable
technology, are finding their way into beauty, and consumers are demanding that these products be free
of harmful chemicals and not burden or poison the environment when discarded.

Deborah Weinswig, CPA
Executive Director—Head of Global Retail & Technology
Fung Business Intelligence Centre
New York: 917.655.6790
Hong Kong: +852 6119 1779
deborahweinswig@fung1937.com

Cam Bolden
cambolden@fung1937.com

Marie Driscoll, CFA
mariedriscoll@fung1937.com

John Harmon, CFA
johnharmon@fung1937.com

Amy Hedrick
amyhedrick@fung1937.com

Aragorn Ho
aragornho@fung1937.com

John Mercer
johnmercer@fung1937.com

Charlie Poon
charliepoon@fung1937.com

Kiril Popov
Kirilpopov@fung1937.com

Stephanie Reilly
stephaniereilly@fung1937.com

Lan Rosengard
lanrosengard@fung1937.com

Jing Wang
jingwang@fung1937.com


16

Technologies Adopted by Beauty Retail: Technically Beautiful

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Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

Global Beauty Market Overview

Part I. Convergence of Beauty and Visual Media

Part II. Digital Beauty Lifestyle

5. Smartphones Double as Personal Beauty Consultants

Part III. Convergence of Science, Medicine and Beauty

9. Genetic Testing for Customized Treatments

Part IV. The Future Is Here

12. Wearable Tech in Nail Art and Makeup

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Global Beauty Market Overview

Figure 1. Global Beauty Market (Millions)

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Figure 2. 2014 Beauty Market: Geographical Breakdown

21% Eastern Europe

22% Africa, Middle East

Figure 3. 2014 Beauty Market: Breakdown by Product

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

PART I – CONVERGENCE OF BEAUTY AND VISUAL MEDIA

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

3. Magic Displays for Shopper Engagement

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

4. Color Matching Goes High-Tech

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

PART II—DIGITAL BEAUTY LIFESTYLE

6. Social Selling Beats Online Ads for Beauty Products

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

PART III—CONVERGENCE OF SCIENCE, MEDICINE AND BEAUTY

10. Biotech Invades Beauty

April 30, 2015

11. Medical Tech in Beauty

PART IV—THE FUTURE IS HERE

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

13. 3-D Printing of Cosmetics

14. Organic and Environmentally Friendly Products

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

15. On-Demand Beauty Services

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

April 30, 2015

Fung Business Intelligence Centre (FBIC) publication: Digital Beauty

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