If 2025 marked a turning point for beauty, it was not defined by experimentation—but by execution. Artificial intelligence, immersive commerce and automation moved decisively from pilot projects to core infrastructure, reshaping how brands innovate, market, sell and operate. At the same time, rising regulatory scrutiny and cybersecurity risks underscored the growing costs and complexities of digital dependence.
AI became the industry’s dominant operating layer. Major players accelerated large-scale deployments designed to drive speed, precision and profitability. The Estée Lauder Companies unveiled ConsumerIQ, a data intelligence platform built with Microsoft to power faster innovation and sharper decision-making. L’Oréal deepened its digital transformation by integrating Appier’s AI technology into SkinCeuticals, using advanced personalisation to improve media efficiency and online conversion. Unilever rolled out 21 AI-powered Sketch Pro studios globally, signalling a shift toward automation-led content creation at scale.
Retailers and platforms followed suit. Boots brought AI directly onto the high street, pairing dermatologist-led pharmacist training with an AI-powered skin analysis tool to make advanced skincare expertise more accessible to consumers. Amazon introduced AI shopping tools such as “Help Me Decide,” while Target and Stripe pushed commerce even further by embedding shopping and checkout functionality directly into ChatGPT—blurring the lines between discovery, advice and transaction.
Immersive and interactive formats continued to gain traction, particularly where technology enhanced rather than replaced physical experience. Zalando’s acquisition of AR start-up DeepAR strengthened its push into virtual try-ons and 3D shopping, while Kose earned global recognition for its mixed-reality, zero-minute try-on studio using high-speed projection mapping. In-store innovation met entertainment online as Charlotte Tilbury partnered with Genshin Impact, marking the brand’s first foray into gaming-led beauty engagement.
Social and creator commerce matured rapidly. Sephora launched My Sephora Storefront, an in-app affiliate platform designed to integrate creators more deeply into its digital ecosystem. e.l.f. Cosmetics debuted its first shoppable Twitch livestream via Amazon Ads, while Maybelline New York partnered with Snapchat to launch an AR-powered look studio in India. These initiatives reflected a broader shift toward community-driven, platform-native commerce rather than traditional influencer marketing alone.
Yet not every digital bet paid off. Shiseido quietly stepped back from its metaverse and web3 ambitions, retreating from NFTs and virtual platforms as part of a wider reprioritisation of tech investment. The move reflected a growing industry consensus that utility and ROI—not novelty—must now justify digital spend.
Automation’s impact extended well beyond marketing. Shopify paused hiring unless roles could not be replaced by AI, while Amazon confirmed that generative AI would lead to workforce reductions over time. At the same time, both Amazon and Walmart explored the use of stablecoins to reduce transaction costs, signalling how deeply technology is now entwined with financial strategy as well as operations.
Regulation and risk emerged as unavoidable counterweights to innovation. TikTok was fined €530 million by Ireland’s data regulator, complicating life for beauty brands reliant on the platform for reach and conversion. Australia issued compliance guidelines ahead of its world-first ban on under-16s using social media, forcing brands to rethink youth engagement strategies. Cybersecurity also moved up the agenda after data breaches at Chanel and Louis Vuitton, highlighting luxury retail’s growing exposure to digital threats.
Despite the risks, digital performance remained strong where execution was disciplined. AI helped push US Black Friday online sales to a record US$11.8 billion, while ODDITY Tech delivered standout results, prompting an upgraded outlook as IL MAKIAGE and SpoiledChild continued to scale through data-led, direct-to-consumer models. Retail media gained prominence too, with THG Beauty launching a new network powered by Zitcha to monetise its platforms more effectively.
Taken together, 2025 confirmed that technology is no longer a separate pillar of beauty strategy—it is the foundation. AI, immersive tools and automation now shape everything from formulation and content creation to commerce and customer service. But as brands race ahead, the year also served as a reminder: digital advantage brings digital exposure. In the next phase, success will belong to those who balance innovation with governance, speed with security, and experimentation with measurable impact.
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