We are witnessing a revolution in the beauty industry today, as “makeovers” increasingly rely on and are defined by technology.  Personal care products are no longer one-size-fits-all or loosely tailored to pre-defined customer segments. Additionally, Web 2.0 applications like social networking, influencer marketing, and ecommerce do not limit the intersection of beauty and technology. Now, every individual’s potential “glow-up” can be powered by gadgets, ranging from AR-based immersive experiences and AI-driven hyper-personalized skincare to IoT-powered smart devices for DIY beauty and next-gen, lab-grown ingredients.

Far from being a purely startup-driven space, industry titans like L’Oréal, Estée Lauder, and Coty maintain a stronghold in the Beauty Tech landscape by acquiring, investing in, and partnering with newer entrants like Function of Beauty and Perfect Corp, which continue to distinguish themselves through specialized beauty tech offerings.

This Insight will cover the most popular technologies in the beauty industry at present, with a focus on Web 3.0 technologies and advancements in biotechnology and nanotechnology in relation to the development of novel, sustainable ingredients. It will cover key use cases of these technologies, notable Beauty Tech startups and incumbents, engagement between players in the broad ecosystem, growth drivers, and potential barriers to growth.

Beauty tech refers to the intersection between technology and the beauty industry, with a focus on how technology is redefining the development, marketing, and sale of beauty products. This includes a wide range of personal care products, including skincare, hair care, and cosmetics. 

The earliest days of beauty tech were characterized by Web 1.0 technologies, with a limited focus on static brand websites featuring product information. Subsequently, Web 2.0 technologies drove the rise of beauty ecommerce, social media marketing, and omnichannel experiences. However, Web 2.0 tools have reached maturity and no longer represent noteworthy tech differentiators among beauty brands. 

Hyper-personalization, inclusion, transparency, and immersive experiences are central themes in the current generation of beauty tech, which now leverages various Web 3.0 technologies like AR/VR, AI/ML, IoT, and blockchain to offer novel virtual experiences, bespoke products, and smart devices while promoting sustainable procurement. 

Beauty tech also leverages innovations in biotechnology and nanotechnology to develop sustainable ingredients and enhance the efficacy of personal care products. The current wave of biomaterial innovations, for instance, leverages biotechnology to develop lab-grown skincare ingredients that are identical to naturally sourced ingredients. 

Meanwhile, the use of nanoparticles as active ingredients in skincare formulations is noteworthy for strengthening product properties, such as entrapment efficiency, dermal penetration, physical stability, moisturizing power, and UV protection.