With Google introducing AR beauty ads on mobile browsers, industry leaders discuss virtual try-ons and their influence across diverse markets.
In cosmetic stores, women often experiment with various lipstick shades on the back of their palms to find the colour that suits their appearance.
However, with the closure of physical stores during the pandemic, brands turned to augmented reality (AR) and virtual reality (VR) to simulate real-life beauty experiences.
On October 25, 2023, Google announced the integration of AR beauty features into mobile browsers, providing users with new ways to try on skincare and cosmetic products and offering brands an opportunity to advertise through AR.
Three years ago, the tech giant introduced AR beauty features and observed a 10% increase in shopper interaction with beauty products when AR was present.
Virtual try-on technology enables customers to virtually test clothes, makeup, and other products before making a purchase. Brands utilise third-party technology, incorporating AI and machine learning to replicate in-store experiences.
The technology has the potential to revolutionise the online shopping experience, particularly for D2C brands that were early adopters due to their exclusive online operations. This approach allowed them to establish a connection with their customers without a physical presence.
Furthermore, it stands as a potential game-changer for traditional retailers, presenting an opportunity to significantly reduce operational costs by scaling down on the number of physical stores they operate.
This shift towards virtual experiences aligns with the evolving landscape of consumer preferences and the increasing reliance on digital platforms for shopping.
Kaushik Mukherjee, cofounder and COO of SUGAR Cosmetics, initially believed that virtual try-ons would replace the act of physically trying makeup products. However, it has created a more profound and evolved online shopping experience, adding a fun element and increasing consumer engagement.
He also gives credit to social media platforms, as consumers are already familiar with virtual filters, making them more receptive to using filters on apps or websites.
“Virtual try-ons added a fun element and engagement. It eventually leads consumers to spend more time on our app,” he highlights.
SUGAR Cosmetics plans to leverage try-ons in physical stores. “If a consumer looks to try out 7-8 shades of liquid lipstick, which is not easy to remove, the technology can be used there.”
Given the extensive range in the cosmetics category, where physical trials are often infeasible, the co-founder notes, “As in our category, there are abundant SKUs (stock keeping units) which can’t be tried physically, but can be tested through try-ons.”
The online brand is utilising this function by offering a Try and Shortlist option to customers, prioritising consumer flexibility over the immediate commitment inherent in a Try and Buy approach.
Through this, the brand observes that, during trials, a substantial 60% of consumers choose to shortlist the product, reflecting a nuanced and thoughtful consumer engagement process.
Hitesh Malhotra, former CMO of Nykaa and Lenskart, emphasises that virtual try-ons can motivate buying decisions but may not always lead to immediate purchases.
“It could work well for brands which have large SKUs to showcase, it can make products discoverable. It can work well with remarketing techniques that can eventually create conversion,” he highlights.
Mamaearth utilises virtual try-ons through Snapchat, allowing users to try out different looks and share them with friends. Nidhi Mehta, VP-marketing at Honasa Consumer (parent company of Mamaearth, Dr. Sheth's, Ayuga & The Derma Co), emphasises that virtual try-ons are not just for awareness but serve as a tool to drive consideration, leading to eventual purchases.
The most popular categories for virtual try-ons, according to her, are lipstick and foundation.
Tanuj Mishra, country head of India, Perfect Corp, a technology company that provides virtual try-on solutions to beauty brands like SUGAR, MyGlamm, Mamaearth, Lakme and Derma Co., notes that makeup is the top category to use try-ons followed by skincare.
“The virtual try-ons boost the confidence of consumers. We also provide virtual try-ons for the whole makeup look comprising different products like mascara, eyeshadow, and eyeliner.”
He states that this approach serves as a method for brands to leverage and promote a specific look inspired by their brand ambassador, with the ultimate goal of driving conversions.
Moreover, virtual try-ons offer a valuable avenue for advertising purposes. Instead of opting for traditional product banners, brands can harness technology to implement try-ons, providing a more immersive and engaging advertising experience for consumers.
Tanuj explains, “Through this, we can create a personalised engagement. If any user visits a website, they can be redirected to a live camera marker where they can experience the product. In this way, a brand is not just advertising but also providing an experience.”
He also states that this could be a revenue opportunity for publishers as well, as they can charge more for these ads.
What’s the next big push?
COVID-19 was one of the driving forces for the interest in immersive technologies as people increasingly opted to stay indoors and shift towards online shopping. Sukhleen Aneja, CEO, Good Brands Co, part of Good Glamm Group believes that the pandemic-induced surge in online shopping adoption propelled the use of the try-on feature. Anticipating a sustained trajectory, she believes this growth will continue at a healthy pace, without experiencing disruptive shifts akin to the initial pandemic-driven surge.
Malhotra adds that the next big push for this feature could be a strong omnichannel play, “Omnichannel will lead to AI a mechanism where the brand can interact with consumers from smaller cities and can get access to them.”
Mehta predicts that the growth of online consumers in the beauty category will drive the organic growth of virtual try-ons, “Live commerce, social commerce, usage of AI/VR will grow traction as the category is growing in online mode.”
Suitability for higher-end purchases
The digital revolution has left no sector untouched, and the jewellery industry is no exception. Brands such as Candere by Kalyan Jewellers, Melorra, PC Jewellers, and CaratLane have embraced the digital shift, offering virtual try-before-you-buy features to enhance consumer experience.
According to Mywisdomlane, a jewellery e-commerce consulting firm, the Indian online jewellery market was valued at $850 million in 2019 and is anticipated to surge to $3.7 billion by 2025, exhibiting a robust Compound Annual Growth Rate (CAGR) of 28%. This data underscores the substantial growth potential of the market, and one of the factors that could drive sales is the virtual try-on feature.
Malhotra says that this technology is unlikely to find success in the luxury category, as this specific market segment continues to demand and rely on physical interactions for a satisfactory consumer experience.
“Globally, luxury buyers physically discover the products before buying. The only reason they would buy the product online is just for a hassle-free experience. In this case, try-ons don’t add any additional value,” he explains.
Tanuj suggests that virtual try-on technology can be particularly effective for jewellery retailers looking to reach customers in areas where expanding through physical stores may not be feasible.
In areas, where customers possess purchasing capacity, the virtual experience can allow them to explore products and subsequently place orders in the physical space.
The application of virtual try-on technology extends beyond the beauty industry. It is currently being applied across various sectors, including home decor, appliances, and automobiles. Pepperfry, for instance, leverages virtual product demonstrations for home furniture, while L'Oreal employs technology to offer hair colour solutions. NEXA by Maruti Suzuki has embraced this trend by creating an AR car showroom, allowing customers to take virtual test drives. Across the spectrum, every category is maximising the potential of this technology to enhance user experiences.
Mukherjee envisions a future where, within the next ten years, a singular device will encompass the entirety of the virtual experience. This suggests that a comprehensive and integrated approach to virtual technologies could revolutionise the way consumers engage with various products and services.
“For our sector, the online catalogue will be replaced by simple product photos to a visual reality giving 360-degree experience. If a user can twist up the lipstick virtually, then the shopping experience will be elevated automatically,” he adds.
Nidhi forecasts a broader penetration of this technology among brands, coupled with integration into live commerce. “Over the next couple of years, it will make the buying journey easier,” she asserts.
Tanuj expresses confidence in the universal growth of virtual try-ons, asserting that these experiences will expand across every category.
“E-commerce platforms are already giving a virtual experience like a user could see how a TV would look on a wall. Customers are already making informed decisions, this will grow at a higher rate,” he states.