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ProQuo AI Predicts The Future Of Skincare

October 18, 2021 BeautyMatter
October 18, 2021

Anyone that’s built a brand needs to know how to manage that brand. This requires constant curation, connection, communication, and adjustment. Consumers are now driving brand conversations in a continuous always-on feedback loop. And companies must engage or be caught flat-footed.

The invention and adoption of technology, along with the innovations in mobile networks and Wi-Fi, means the creation and consumption of data are constantly growing. On average, in 2020, every human created at least 1.7 MB of data per second. This makes managing a brand in this hyper-connected modern marketing ecosystem humanly impossible.  

Big data. Machine learning. Artificial Intelligence. Brand insights. It’s time to transform these from technology buzzwords into actual execution. We’ve entered a new era of brand management where the art of brand management—which has for so long been driven by instinct and experience—is evolving into a technology-powered science. This science is capable of moving faster and more accurately than any human can, and it’s providing marketers with a greater level of certainty. 

"There are over 25 million combinations of actions Brand Managers can take, over the course of a year. Some lead to success; others result in setbacks. Having so many options can be intimidating when trying to decide the direction in which to take your brand." said ProQuo AI founder and CEO Nadim Sadek.

"That’s why AI has been the biggest game changer for Brand Managers, speeding up the decision-making process by evaluating all these potential options, in seconds, and extracting the most significant option for brands to take for growth. It also brings certainty. Certainty that you’re making the right investment in a marketing action. Certainty that you’ll have positive outcomes,” Sadek continued. 

Companies and brands are grappling with different issues, depending on their size and cause, but there is no denying that challenger brands are getting bigger, faster. And the beauty landscape has never been more crowded or more competitive.

This is especially true of the skincare segment, which has boomed in recent years, accelerated further by the unprecedented period of upheaval brought about by the pandemic. ProQuo’s platform data sheds light on the latest trends influencing this market, showing how isolated consumers shelved their makeup in favor of skincare routines. The tech platform found 21% of consumers now wear less makeup than they used to, and 31% are more interested in the self-care and skincare space than they were before the pandemic.

Total global beauty industry spending in 2020 was $483 billion, with an annual growth rate of 4.75% CAGR. This is due to reach $716 billion by 2025. And skincare is at the top of this category, accounting for approximately 39% of the global beauty market in 2020, and estimated to be worth $189.3 billion by 2025. The United States represents the largest proportion of the skincare market, with revenue estimated at $36.5 billion in 2020, accounting for a 27.03% share in the global market.

Trends, Drivers, and Category Expectations 

The boom in the skincare segment is attributable to the unique position the category occupies at the confluence of numerous trends. Among them is a renewed focus on health and wellness, with conscious consumers demanding scientific substantiation and transparency. The ability of new technology to simplify complex choices and personalize products is also prevalent, amplified by social media's ability to inform and connect. 

Brand drivers are a tool that all businesses can use to achieve cohesive brand messaging, drive home their brand identity, inform decision-making, and influence a brand's position in the marketplace. ProQuo's science-backed principles are fueled by these Drivers, which are based on people's feelings and thoughts about a brand, its competition, and its category. ProQuo has proven all human relationships are based on 16 core Drivers, and these range from ordinary things like how Aspirational a person thinks a brand is to how cost-efficient they believe the product to be, and even how much Integrity they think the brand has. 

In the first half of 2021, ProQuo found consumers were predominantly looking for safety, comfort, and familiarity from skincare brands. This shifted as uncertainty lifted, and they became open to taking bigger risks, moving away from functionality, like the Accessibility of products, and into more human Drivers, like Empathy and Transparency. The brands that had the capacity to tap sensitivity and openness fostered deeper connections with their consumers. As life slowly begins to return to normality, focusing on disruptive factors like Differentiation and Aspiration were recommended as the cornerstones for superseding the competition. 

Six core consumer expectations have emerged for the US skincare category. These are hygiene factors within the category, and brands in this space should be focusing on these Drivers in order to compete:

  • Accessibility: A brand that is easy to use, as the experience is uncomplicated and intuitive. 
  • Innovation: A brand with momentum that does things in new ways, constantly iterating, developing, and discovering original ways of thinking and doing things. 
  • Integrity: A brand that has principles and behaves honestly, always choosing the right thing because of the clear values it holds.
  • Relevance: A brand that meets your needs or wants. What the brand offers has a direct bearing on your life. 
  • Attraction: A brand whose physical character draws you to it, either because it looks good or presents itself well. 
  • Familiarity: A brand that you know and feel you know something about. 

The spaces that are ripe for disruption in the current US skincare landscape–where the competition isn’t currently playing—are:

  • Differentiation: A unique brand that stands out from the crowd through its character, communications, or in what it offers.
  • Aspiration: A brand that feels desirable and has something special that you want, creating an urge to have it or a sense of exclusivity. 
  • Performance: A brand that fulfills its promise noticeably well, delivering against consumer expectations for the category. 

Meeting consumers where they are and living up to their expectations are table stakes to break through the noise of an increasingly crowded category. Customers expect a brand to know them, anticipating their needs, personalizing experiences, and remembering preferences. Delivering on these expectations requires the collection and contextualization of big data sources.

Tapping Growth in a Crowded Category 

Competition in the skincare category is fierce, but the lines between skincare and makeup have also blurred, with current events accelerating the trend. Minimalist consumers are looking for multitasking hybrid products to increase category competitiveness.

ProQuo has four top tips for skincare brands to achieve growth in the US market: 
1. Empathize with your Packaging. 30% of customers are looking to buy brands focused on sustainability, so use Packaging to show your audience that you Empathize with their wants and needs while enhancing your perception of being socially responsible. The way you present your product is the initial demonstration of how deeply you understand your customers, so take Packaging as an opportunity to Innovate and delight shoppers, while showing you know what they’re looking for in a skincare brand. Take it a step further by empowering sustainable practices through rewarding customers using Packaging trade-in initiatives. 

2. Stay Relevant by driving personalization. Brands that excel in Relevance effectively show their audience how seamlessly a product fits into their lives and meets their needs. Personalize the Customer Experience wherever possible, tailor the journey to the shopper by leveraging consultation questionnaires, bespoke products, customized alerts, and targeted marketing to create a more uniquely Relevant experience. Then, show your customers just how much you know them with data-driven email marketing. 

3. Deliver an experience that is unique. A brand’s ability to be unique is an indication of its Differentiation. One way to to achieve this is by making your Product Delivery format special and engaging, which provides an opportunity to differentiate, creates a sense of excitement, and boosts Aspiration. Think about the ways you can make this experience memorable for the customer. It may be packaging the product distinctly and recognizably—creating the perfect unboxing experience—or including something that creates a sense of exclusivity. Thank-you notes, sample products, and offers make customers feel like they matter, while rewarding loyalty with exclusive access to events or product releases reinforces the sentiment. Most importantly, show your customers what makes their relationship with your brand special. 

4. Hang with the Popular kids.  Building Popularity can often stem from tapping into the buzz around another brand or influencer. Find one that connects with your target audience and co-brand a product to create positive associations around the relationship and boost Popularity with various segments. The key to success here is making sure that the strategic purpose of this Partnership is clear and comes off as authentic to customers, so choose your other half wisely. Once you’ve teamed up, get the word out across channels that are relevant to both your existing audience and your new targets. 

The global skincare market shows no signs of slowing and is projected to reach a revised size of $165.4 billion by 2027, growing at a CAGR of 2.9%.

Money continues to flood into the category as VC and PE firms place their bets on the next billion-dollar beauty brand, raising the bar on what it takes to compete for a piece of the skincare market. 

For a comprehensive deep dive into the US and UK skincare segment and a look into the category leaders, download the full ProQuo report, “Tapping AI intelligence A Fresh Look into Skincare: Category Report.”