Cosmetics giant L'Oreal decided to buy the Canadian company that created the ModiFace application. Thanks to the technology developed by the app's creators, users can check and "match" a lipstick shade, new brows, makeup, hair color, skin tone, and it even simulates the effects of cosmetic treatments.
Technology for the beauty industry
ModiFace is used by more than 100 cosmetics companies, including Sephora, which offers a way to try out 8,000 products this way. All the largest cosmetics brands are investing in augmented reality technology that lets consumers try on virtual makeup. Such applications are also offered by Maybelline, CoverGirl, Rimmel London, Cargo, Smashbox and Estée Lauder.
The first IT company in the portfolio
Within its portfolio of cosmetics brands, L'Oreal owns, among others: Laboratoires Vichy, La Roche-Posay, Garnier, Biotherm, Helena Rubinstein, Lancome, Ralph Lauren, Yves Saint Laurent and NYX Cosmetics. ModiFace is the first IT-sector company acquired by the French conglomerate.
Previously, the company co-created a similar application - the free "Makeup Genius", which has more than 20 million users.
Cooperation instead of acquisition
ModiFace employs more than 70 people and holds more than 30 patents. The amount of the transaction has not been disclosed to date. The two companies had already worked together to create the "Style My Hair" application, which allows users to choose the right hairstyle and hair color, and also lets them find the nearest hair salons.
Online sales and influencers
Last year, L'Oreal generated more than EUR 2.0 trillion from online sales. This is a significant increase in profit compared with 2015. The conglomerate works with many bloggers on Instagram and YouTube who help promote and sell the company's products.
Summary
L'Oreal's acquisition of ModiFace is a strategic step in developing augmented reality technology in the cosmetics industry. The company that created the application allowing virtual product testing has more than 70 employees and 30 patents. This technology had already brought the two entities together for the "Makeup Genius" application, which gained 20 million users.
It is worth emphasizing that this is the first acquisition of an IT company by the French conglomerate, which last year reached more than EUR 200 billion in online sales. L'Oreal actively cooperates with influencers on Instagram and YouTube, which shows that digital transformation is a key element of the giant's strategy.
