Beauty’s $550bn opportunity: Solving the product discovery challenge

The beauty sector is booming, with global sales surpassing $550 billion. Yet one obstacle continues to slow its full potential: helping shoppers quickly identify the products that truly suit them.

The modern customer faces endless options and complex decision-making. It’s not unusual for someone to spend more than 60 minutes researching a single item online, a process that often leads to frustration, decision fatigue, and abandoned purchases. This growing friction has created a widespread product discovery gap across the industry.

Why finding the right product is so hard

Unlike many retail categories, beauty purchases are deeply personal. Shoppers must consider skin type, ingredient compatibility, shade accuracy, texture, and performance, details that standard e-commerce filters rarely handle successfully.

Recent behaviour trends highlight the shift:

• Influencer-led discovery has declined from 15% to 7% between 2023 and 2025
• 51% of consumers now depend on customer reviews
• 82% say they would welcome AI support to shorten their research time

Existing tools often fall short. Search results aren’t tailored enough, reviews lack personal relevance, and many recommendation engines rely on limited data. The result is a fragmented, time-consuming journey.

How technology is reshaping discovery

To simplify the process, brands and retailers are adopting new digital solutions:

• Image-based search to find similar products instantly
• Virtual try-on (AR) to test shades and looks digitally
• AI-driven recommendations based on personal profiles and past purchases
• Conversational AI that allows customers to explain their needs in everyday language and receive tailored suggestions within minutes

More advanced platforms connect these insights directly to live retailer inventory, ensuring recommendations are practical and immediately purchasable.

Connecting digital guidance with physical retail

Even in a digital-first world, beauty remains experiential. Many customers still want to see, touch, or test products before committing.

To support this behaviour, retailers are introducing AI-enabled kiosks and QR-based consultations in stores, delivering personalised advice at scale. Some implementations have reported conversion increases of up to 20%. Rather than replacing beauty advisors, these tools are designed to support and enhance their expertise.

Why the timing matters

Several forces are accelerating adoption:

• A retail media ecosystem projected to reach $179.5 billion
• Estimates that generative AI could contribute $9–10 billion in additional value to the beauty industry

As with the early days of e-commerce, businesses that move quickly may secure long-term advantages.

The competitive impact

Smarter discovery creates a better experience for both shoppers and retailers. Customers spend less time researching and feel more confident in their choices. Brands benefit from higher conversion rates, fewer abandoned carts, and stronger loyalty.

The direction of travel is clear: success in beauty retail will depend less on the number of products offered and more on how effectively customers can find the right one.

In the next phase of beauty commerce, winning brands won’t ask shoppers to navigate complexity; they’ll use technology to guide them to the perfect match.

We’d love to hear your thoughts on these insights. Get in touch to continue the conversation.

Source: Retail Technology

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