This story is Part 2 of a three-part series on how L’Oréal USA is adjusting its internal business to focus on sustainability, consumer technology and employee equality, in the name of modernization. Read Part I, here.

The future of beauty may be born in New Jersey.

Tucked away in a facility in the city of Clark is L’Oréal USA’s technology incubator, which has been creating consumer products that are connected, customized and designed to meet customers’ rapidly evolving needs since it was founded in 2012. So far, the incubator has debuted wearables, devices and apps, all of which are strategically designed to bring the 109-year-old company to the forefront of the beauty industry.

As global vp of the L’Oréal Technology Incubator, Guive Balooch has been tasked with leading the development of new consumer products in-house. Under his direction, the incubator has produced five products — its first, Makeup Genius, launched in 2014 as an app that lets users virtually try on makeup with AR. Most recently, it launched Custom D.O.S.E (Diagnostic Optimization Serum Experience), which can scan and evaluate a customer’s skin and combine active ingredients into a tailor-made serum in three to five minutes.

All of the product developments reflect the mindset that personalization, automation and virtual reality will dominate the future of beauty, according to Balooch.

“My dream for my team and for the beauty industry is about ‘beauty for all,’” he said, referencing L’Oréal’s larger mission called Beauty for All, which details the company’s initiatives around technology, diversity, sustainability and more as it moves forward in modernization. “We need to find a way for everybody — whether you are in Africa or China — to have the right product, and I believe, in the next five to 10 years, it is [my team’s] responsibility to make that happen through technology.”

When Balooch was first tasked with developing the incubator in 2008, he was essentially creating a startup within the century-old company. Balooch initially sought to have a team of 10 people and focus on roughly 10 product launches using augmented reality and connected devices, but the scope has since expanded. Now the team has 33 people across offices in San Francisco, Tokyo and Paris, with people versed in subject matters far flung from beauty, including data scientists, UX designers, biologists, industrial designers and more. Balooch said the threefold growth is due to a broadening of focus for the incubator.

“As we started to see the movement around personalization [and more], we had no choice but to grow, but it was a growth based on the need,” he said, adding, “We started humbly, because if you don’t, you can’t do things quickly and in a focused way.”

But creating a startup mentality within a heritage brand has not come easy for the incubator or other divisions within L’Oréal. Getting products to market typically takes a village of different groups and personnel, so the incubator had to make sure it was interacting with outside groups rather than working in a silo, Balooch said. Additionally, the incubator took on the role of educating the rest of the company on its merits to the brand; while it was well received when it began, there were many people who did not understand the significance of what the incubator did or what it meant to the company, he said. But that all changed when Makeup Genius debuted just as augmented reality was becoming mainstream.

“Once Makeup Genius launched and we had all of these projects come onto the market, our internal teams understood that this is something that is going to be part of every brand and every experience, and it’s not only that, but it will also create value — not just in business but with our consumers,” Balooch said.

Augmented reality, in particular, represents a long-term investment for L’Oréal. In March, L’Oréal Group bought ModiFace, the Toronto-based company making custom augmented reality beauty apps for brands like Sephora and Estée Lauder. Before the ModiFace acquisition, Makeup Genius had over 20 million downloads but is no longer available on the app store. Considering the brand spends 38 percent of its media budget on digital campaigns, according to Reuters, the ModiFace buy positions L’Oréal Group to further capitalize on AR’s offerings across all of its portfolio brands, including Kiehl’s, Garnier and Urban Decay.

Features like augmented reality are also key to helping L’Oréal create customized products that are tailored to consumers’ needs, which Balooch sees as an essential part of the beauty industry’s future. ModiFace’s technology, for example, can handle skin diagnoses which can offer potential functionality similar to Custom D.O.S.E. As people are able to understand their beauty needs because of technology and find the customization they need, the “beauty for all” concept will evolve into “beauty for you,” Balooch said.

“This is an important place for technology, because it’s not just about personalization in a vague term; it’s about the fact that every person in the world should have access to the technology and the product that is right for them,” he said.