Case Study: Avon’s Transformation Through AI and Beauty Tech

Avon, a 137-year-old cosmetic giant known for its “Avon ladies” and B2B2C consultative business model, embarked on a significant digital transformation journey. This transformation was fueled by partnerships with o9 Solutions for digital commercial planning in Brazil and Perfect Corp for integrating AR and AI-driven beauty technology. These strategic moves aimed to modernize Avon’s approach, enhance customer engagement, and drive significant business growth.

Key Takeaways

  • Avon successfully adapted to the digital era by leveraging AI and AR technologies.
  • Partnerships with o9 Solutions and Perfect Corp were crucial to this transformation.
  • The initiatives led to a 320% increase in conversion rate and a 33% increase in average order value.
  • Digital tools facilitated a seamless transition from traditional to omnichannel and digital-first approaches.
  • Avon’s embrace of technology has positioned it for future growth and adaptation to evolving consumer behaviors.

Approach

Avon’s approach to digital transformation was twofold: internally revamping its commercial planning and externally enhancing the customer experience. Internally, the partnership with o9 Solutions focused on utilizing AI for sophisticated planning and analysis across various channels. Externally, collaboration with Perfect Corp introduced AR and AI to offer virtual try-on experiences, thus modernizing the customer journey and making it more engaging and personalized.

Implementation

The implementation involved deploying o9 Solutions’ AI-based platform for improved business planning and decision-making in Brazil. This initiative aimed at integrating and analyzing varied scenarios to optimize commercial strategies. Concurrently, Avon adopted Perfect Corp’s AR and AI technologies to allow customers virtual try-ons of beauty products, which redefined the shopping experience and made it more interactive and personalized.

Results

The integration of AR and AI technologies into Avon’s business model led to impressive outcomes, notably a 320% increase in conversion rates and a 33% rise in average order values, signifying heightened customer engagement and purchase intent. The use of virtual try-on technology also resulted in customers exploring a wider array of products, enhancing their shopping experience. Additionally, these digital transformation efforts successfully attracted a younger demographic, including a significant influx of Gen Z representatives, positioning Avon for sustained future growth.

Challenges and Barriers

The digital transformation journey was not without challenges. Integrating cutting-edge technology into a legacy business model required overcoming internal resistance and ensuring technological compatibility. Additionally, maintaining the personal touch that Avon was known for, while transitioning to a digital-first approach, posed a significant challenge.

Future Outlook

Looking ahead, Avon is positioned to further capitalize on the integration of beauty tech. The company plans to explore more AI integrations, delve into predictive analytics, and expand the omnichannel experience. With a focus on continuous innovation and adapting to consumer trends, Avon is well-prepared to maintain its relevance and leadership in the beauty industry in the digital age.

Sources:
o9 Solutions Partners with Natura and Avon in Brazil to Offer Digital Commercial Planning Solutions
Avon Sees 320% Boost in Conversion, 33% Increase in Average Order Value Using Perfect Corp. Virtual Try-On
How Avon and Revlon Are Using AR to Cut Down on Returns


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