Reporter | Xu Yue
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A round tube lipstick with YSL is rapidly turning off the assembly line, and the quality inspection conducts a final inspection of them, and then it will be covered with a lid and boxed. The hollow logo is wrapped around a golden lipstick tube filled with women's fantasies of beauty, dreaming of being like a model of a fashionable poster outside the factory building, with delicate faces with full-colored lips.
The production process of lipstick is much more "polytechnic" and less romantic. This is L'Oréal's Lassigny plant near Paris, where in 2016 a flexible production line managed by computers and a combination of multiple production modes was commissioned. The L'Oréal Group has more than 10 brands that sell makeup, while the Lassigny plant produces premium cosmetics such as YSL and Lancôme.
Based on sales feedback, the flexible production line is able to change the production mode within 20 minutes, switching from producing one lipstick brand and lipstick color number to another brand and color number. Prior to this, L'Oréal took 3 hours to change production models.
In the 22 years since entering China, L'Oréal currently has a total of 23 brands for sale in China - makeup such as YSL, Lancôme, Maybelline, etc.; skin care products such as Li Skin Spring, Keyan's and Biosen, etc.; and hairdressing brands, such as L'Oréal Professional Hairdressing and Kashi.
Over the years, makeup products have continuously refreshed China's social media hot list, and the one that impressed L'Oréal's French employees was the popularity of YSL Square Tube No. 52 "Star You Color" in 2014. The emergence of flexible production lines can solve the problem of how to quickly keep up with the supply after the emergence of explosive models like "Star You Color".
Out-of-stock For beauty companies, the obvious consequence is to miss a wave of sales opportunities.
"For makeup, the explosive models often come from popular elements such as color and packaging, and with the competition in the market, the popular time of the makeup category and the rhythm of the competitor strategy are greatly accelerated, and consumers are very easy to find alternatives or change interests in a short period of time." Li Xi, senior manager of management consultancy Roland Berger, told Interface News.
According to sales feedback, the Lassigny factory production line was able to change the production mode within 20 minutes, switching from one brand and color number to another brand and color number – before that, L'Oréal took 3 hours to change production mode.
The transformation of flexible production lines is part of L'Oréal's transformation from a traditional beauty company to a beauty technology company. In 2017, this reform was proposed by L'Oréal's current global CEO, Paul Angung. L'Oréal stressed that this is not just a beautiful public relations slogan, and digitalization will be integrated into the marketing, sales and supply chain production of the group's brands.
In fact, almost all beauty giants have demonstrated a focus on new technologies, with L'Oréal being one of the most active, increasingly investing and marketing. In an analysis, Euromonitor believes that technology is becoming part of the core strategy of beauty companies.
Competition in the beauty industry is entering a new phase.
In the mid-1960s, France became the most developing country in the beauty industry, intensively opening 430 companies that produced cosmetics and toiletries, and since then the United States and Germany have continued to rise.
In the book "Beautiful Wars: A History of the Cosmetics Giant's Global Domination," Harvard Business School professor Jeffrey Jones describes that although London and Stockholm once wanted to emulate Paris, Paris had never met an opponent. They not only export products to the world, but also aesthetics through mass communication tools. Looking back at the competition of the past hundred years, the competition of beauty companies has mainly focused on the improvement of formulas and the development of channels.
After World War II, with the improvement of various technologies such as "solvent extraction", beauty companies were able to bring products that had been innovated in smell, texture and formulation to the market.
On the other hand, from hair salons and supermarkets to pharmacies and perfume stores, beauty companies creatively launch brands for specific customer groups according to the characteristics of each channel, and then greatly broaden the mass market through the magic of advertising.
But today, doing just that isn't enough to make beauty companies stand out from the competition. Technology amplifies the voice of the consumer, and the dissolution of information asymmetry makes it more difficult to make an effective advertisement.
In addition, mobile Internet such as Instagram and Weibo easily creates thousands of small brands, and at the 2017 Women's Daily Beauty Summit, an industry executive gave a set of data: sales of traditional beauty companies fell by 1.3%, but sales of independent brands increased by 42.7%. How can you get consumers to proactively discover your products?
L'Oréal is trying to get up and change, but it needs to overcome all kinds of difficulties. First of all, for a 110-year-old multinational company, it takes a lot of determination and action to break the existing thinking from the inside.
Lubomira Rochet, L'Oréal's Global Chief Digital Officer, said this means that processes and procedures within the company will change, and IT systems will be restructured to make it more open and able to share information and technology with L'Oréal's partners. Five years ago, L'Oréal created a new position as Chief Digital Officer, a role that Rochet, then 36, began.
For luxury companies, including beauty and fashion, technological reform faces not only a technical threshold, but also a psychological threshold. How to achieve a good balance between the image of scarcity of high cold and better adaptation to the times. Compared with the two, the beauty field has a more proactive and positive attitude towards science and technology.
"When it comes to e-commerce, everyone always thinks that this may be a price problem, but in fact it is not, it is not only a matter of price, it is a matter of convenience, you can get what you buy at any time, whether it is an hour, or a week." So it's a matter of choice. Rochet told Interface News.
In addition to the flexible line technology used in the Lassigny plant, L'Oréal has made technical changes to every aspect, from R&D to sales. At the technology fair VIVA TECH in Paris in mid-May, L'Oréal presented them intensively.
At L'Oréal, technological change is driven by point-to-point. In 2017, Lancôme launched a custom foundation service called Le Teint Particulier.
Its principle is to use a handheld detector to scan the skin, and then design the naturalness and concealment of the foundation according to the parameters, mix 8 basic materials in the machine at the sales site, and complete the production of the custom foundation in about 15 minutes. Compared to conventional foundation products, Le Teint Particulier's customized system can make thousands of color numbers.
As the technology matures, L'Oréal wants to promote the e-commerce business by launching a service that can realize the mass production of customized foundations, My Little Factory - after obtaining skin information through the detection machine, consumers can order customized foundations through My Little Factory's website, deliver them directly to home, and the skin information can be reused in future orders.
At VIVA TECH's booth, L'Oréal showed how customized foundation fluids are fused and manufactured in the factory through robotic arms through physical objects and videos. By the end of 2019, My Little Factory is expected to have 1,000 points of sale worldwide.
How to carry out top-down reform, single-brand companies and multi-brand companies have different considerations. For L'Oréal, Rochet has repeatedly mentioned the importance of borrowing from each other's brands, which may be the lowest cost of trial and error, while quickly finding a breakthrough.
"Once we have a good idea for one of our brands, we can copy it to another brand," Rochet explains, "and we have about 150 markets in the world, and we have 36 brands, so we can share this good practice between brands." ”
L'Oréal did not disclose how much money was invested in the transformation into a beauty technology company. But it's well known that L'Oréal has hired more than 2,000 new data experts, with 22,000 employees participating in a large-scale digital skills incubation program in 2018; and acquiring Mofice, a Canadian company that applies virtual reality (AR) and artificial intelligence (AI) technologies to the beauty industry.
In addition, L'Oréal incubated beauty technology startups in The French technology accelerator Generation F, where L'Oréal mentored them for a period of 6 months to help them solve various production and research and development problems.
In the industry related to beauty, what used to be given by the brand, consumers will pick what. But social media has dismantled this old relationship, and Instagram, which is about to be 10 years old, has shifted part of the decision on trends to the masses, who will create them.
So L'Oréal also developed the corresponding tool to pull data on Instgram. The tool, called Deep Vision, also appeared on VIVA TECH. Through Deep Vision, L'Oréal can export 1 million beauty-related pictures from Instgram, dividing these pictures into lips, eyes, lipstick arm color tests and other picture types, identifying the current beauty trends as a reference for product development.
In the L'Oréal booth of VIVA TECH, in addition to the display of new technologies such as My Little Factory, 3D custom printed perfume bottles, deep Vision, etc., the sharing of Chinese market experience in the exchange session also received the attention of visitors. L'Oréal has been in China for only 22 years, but has gone through two stages of the Chinese beauty industry and has developed China into its second largest market in the world.
Li Xi, senior manager of Roland Berger, believes that the development of China's beauty industry can roughly take 2010 as a watershed. Before 2010, it was the popularization stage, and since 2010, it has been the upgrading and subdivision stage.
The market growth before 2010 came from the consumption base, and as more consumers began to use beauty products, low-end brands developed rapidly at this stage and undertook the market pioneering mission of "starting from scratch". After 2010, the high-end market developed rapidly, and the market growth rate of these two types of brands was almost 2-3 times the growth rate of the mass market, and many overseas high-end brands entered the Chinese market.
With the upgrading of consumption, the focus of competition in the beauty industry in China has changed from basic categories such as BB cream and CC cream to fashionable categories such as lipstick - lipstick is also a popular category on Chinese social media in recent years.
Sharing the experience on the VIVA TECH stage is Hagen Wülferth, Chief Digital Officer of L'Oréal China.
Wu Hanwen is fluent in Mandarin, still in Beijing, and he has been studying Chinese for only ten years. Language skills can help Wu Hanwen better understand China's beauty consumer market , China's mobile Internet is heterogeneous and polymorphic, and has been quite different from the European and American markets. In addition, 35% of L'Oréal's performance in China comes from e-commerce, and L'Oréal needs to tailor more new methods for China.
There are many factors driving the explosion in China, which may be because of tv dramas, may be because of a circle of friends from an unknown source, and may be because of an Internet celebrity. What is important is how the brand captures the formation of the explosive model in advance, and subsequently arranges production and stockpiling. Wu Hanwen and his team developed a set of monitoring tools, such as "black gold lipstick", when it was discussed as a topic, doubling the search on the first day and continuing to double on the second day, it may be considered that the heat is rising.
Black Gold Lipstick is an example of L'Oréal China actively finding consumer demand, in fact, not only cosmetics, but also skin care products have the same goal. A recent attempt to achieve this goal was the Effaclar Spotscan, an online oil pox muscle detection system developed by L'Oréal's active healthcare brand Risperia and Tmall, which was also released at VIVA TECH.
The detection idea of this system is similar to the diagnostic logic of the dermatologist, turn on the front camera of your mobile phone, and the system detects the distribution of acne, which is divided into 0-4 levels according to severity. After the test is complete, the page will jump to recommend the corresponding skin care products according to your acne situation. Due to the difference in mobile phone models, the accuracy of the front camera is also different, but the demonstrators of Li Skin Spring said that the accuracy of the iPhone 6 or more can reach 95%.
"Efika" will be a targeted marketing - according to individual needs, find personalized product combinations in standardized products. Chen Min, vice president of L'Oréal China and general manager of the active health cosmetics division, feels that in the Internet era, with the fragmentation of time and the fragmentation of information channels, old-fashioned marketing can no longer have the crushing and large-scale influence of the industrial era.
"Our new marketing is also that through the Internet we found that Chinese consumers are pursuing acne (care), and last year we ushered in the fastest growth in so many years." Chen Min told Interface News.
According to the plan, Efika will be officially launched in the Tmall store of Skin Spring in June, targeting a large oily muscle population in China. The remaining question is to what extent Risper Springs will be able to capture customers with this AI technology.