Direct-to-consumer hair-color brand Madison Reed is incorporating augmented reality and artificial intelligence technology into its business strategy. On Thursday, the brand revealed a new collaboration with beauty technology company Perfect Corp. by embedding its YouCam Makeup beauty app into Madison-Reed.com via a virtual try-on tool.
With the new site tool, Madison Reed consumers can virtually try on more than 40 hair colors by using a live camera or uploading a selfie directly with a cell phone, tablet or desktop. The feature is powered by proprietary color-matching technologies, as well as deep-learning technologies to not only identify the hair but notice the unique shade subtleties within one’s own hair color and, subsequently, apply the new shade in a nuanced manner. The functionality includes a split screen with a built-in slider toggle to highlight the difference between a client’s current hair color and the new virtual shade.
Since launching in 2013, Madison Reed has relied heavily on technology to improve the customer hair-color experience beyond selecting a shade in drug stores or through a color specialist in a salon. Currently, the brand incorporates an online personalization quiz to help customers find their best hair shade match. (According to Madison Reed, 5.5 million customers have taken the quiz, and it has a 92 percent completion rate on the site.) It also features on its site “Madi” chat bots, which debuted in 2016 and were later customized for Ulta Beauty shoppers in 2017. For Madison Reed, its Perfect Corp./YouCam partnership plays on past learnings through those tools.
“Technology is very much part of who we are,” said Tyler Wozny, vp of digital experience at Madison Reed, who tested the try-on tool on 10 in-house employees and over 100 customers prior to Thursday’s launch. “We’re constantly thinking about ways to improve the business. Augmented reality has blossomed over the last two years, and it is very clear that it could help our clients find their perfect [hair] shade beyond the quiz or the chat bots.”
Rather than requiring customers to download a separate app to experience the virtual try-on tool, Madison Reed thought embedding the YouCam technology onto its own site would make conversion more seamless, said Wozny. “We didn’t want to create any friction in her experience; we wanted to serve our customer where she already was,” he said. This is starkly different from L’Oréal Professionnel’s strategy with its Style My Hair hair-color app, which was created by Modiface and launched in January.
Within beauty and personal care, the hair-color market is slowing in the U.S. According to market research firm Euromonitor International, sales for the next five years are set to drop 6 percent, from $1.73 billion in 2017 to $1.63 in 2022. Madison Reed’s efforts to incorporate a bigger customer-centric technology push are to take away shares from industry leaders like L’Oréal Groupe and Coty.
Developing its own custom online AR and AI technology with its 15-person tech team and Perfect Corp. was especially important, as 90 percent of the brand’s business is still direct-to-consumer. Madison Reed also recently began experimenting with physical retail via its Color Bars, thanks to a $25 million Series financing round led by Comcast Ventures in October 2017 — this brings the brand’s total equity financing to $70 million. The brand operates four total, in the San Francisco area and New York City, but is expected to open 25 more by the end of 2019.
The virtual try-on tool via a website was new for Perfect Corp. in the hair-color category, as well, according to Lindsay Colameo, senior beauty editor at the company. In January, Perfect Corp., which boasts over 700 million app downloads, unveiled its YouCam live hair coloring feature for customers on the app and also partnered with hair-color brand Punky Colour on an in-app try-on tool in September. Still, Colameo saw those experiences largely as “beauty discovery” tools.
“We may be all conditioned to this app culture, but people are already shopping the Madison Reed site, and this tool adds an elevated and nuanced experience to their online shopping,” she said. “There is a stronger intent to purchase on their own site directly, and this try-on is only going to fuel that.”