How AI software is helping DTC beauty brands to shine

26-Sep-2023 - Last updated on 26-Sep-2023 at 13:18 GMT

As the Direct-To-Consumer (DTC) beauty market continues to carve out a bigger share of the retail landscape, using the right tools to fine tune digital retail platforms has become make or break.

CosmeticsDesign-USA (CDU) spoke to Melissa Bridgeford (MB), CEO and co-founder of Wizard Conversational Commerce, an AI-powered, two-way SMS platform designed to help brands provide more personalized and engaging mobile shopping experiences.

In this interview we find out about the potential impact this kind of software could have for DTC beauty brands and how it can help overcome specific challenges and hurdles brands face in this space, as well as getting a look in on where the company’s technology is heading in the future.

CDU: What is the potential impact of conversational commerce as a tool for beauty and skincare DTC brands?

MB: AI-powered conversational commerce is a powerful tool for beauty and skincare brands to engage, market and sell to their consumers. Customer retention and lifetime value are more important than ever for brands, and traditional SMS 1.0 marketing tactics of batch and blast - with web links and promo codes - are no longer sufficient to meet consumer’s digital needs.

Wizard’s is disrupting the one-way spammy SMS 1.0 space with a delightful two-way conversational AI experience SMS2.0 to drive sales, search and customer service via text. With Wizard, brands can send interactive and personalized marketing campaigns that generate engagement, data, sales, and loyalty. Meanwhile, consumers get real-time and personalized product answers and recommendations from their favorite brands, while also being able to complete checkout and payments via text, enabling consumers to bypass the web entirely. The result is an increase in repeat purchase rates and consumer loyalty.

A great example of this is Fig.1, a fast-growing skincare brand that turned to Wizard to offer two-way SMS as a new channel for customers to directly purchase products, receive personalized recs, and ask questions. With Wizard, Fig.1 is providing personalized connections with customers, reaching 85% engagement via text. This high engagement and personalized touch has driven a ~20% increase in order volume and a repeat purchase rate of 28% via text.

CDU: What pain points does conversational commerce solve for beauty and skincare DTC brands?

MB: Traditional SMS marketing (SMS 1.0) sends batch and blast messaging to consumers that are one-size-fits-all, which feel very spammy and generic. When it comes to beauty and skincare, every consumer’s needs and routine are unique and brands’ marketing needs to follow suit. Conversational commerce enables beauty and skincare brands to deliver a full-service digital shopping experience to address consumers’ personalized skincare or beauty needs.

One example of this is AAVRANI, a skincare brand that bridges the gap between beauty and wellness by combining ancient Indian wellness rituals with modern science. The brand turned to Wizard to elevate and personalize their digital customer experience using two-way conversational commerce (SMS 2.0).

Determined not to bombard consumers with spammy website links and promo codes, AAVRANI is using Wizard’s AI-powered platform to provide consumers with live skincare experts, personalized product recommendations, and easy ordering – all via text. And the results are powerful, AAVRANI has seen a 23% increase in sales and +36x ROl with Wizard.

CDU: What are some challenges that beauty and skin care DTC brands are currently facing? How does conversational commerce solve these issues?

MB: From influencers sharing their go-to skincare products to YouTube beauty tutorials, there is a wealth of information and advice out there and consumers are overwhelmed. Because no two people’s skincare or beauty needs are the same, most consumers wind up using products that aren’t right for them and can walk away feeling frustrated and unsatisfied with a brand.

Customers often need reassurance, information, or validation before making a personal purchase. Questions like “is it safe for nursing women?” or “is it hypoallergenic?” come up often for customers just before checkout. In these cases, expert reassurance goes a long way towards converting uncertainty into an order.

With AI-powered conversational commerce, beauty and skincare brands are helping consumers find the products and routines that are best for them. Wizard’s two-way text platform allows brands and customers to interact through product discovery, product search, orders, repeat purchases, and subscriptions – all of which drive customer lifetime value and retention too. As soon as a customer runs out of a product they love, all it takes to re-order it is a simple text.

For example, Under Luna, a non-toxic hair and skincare product line, turned to Wizard to give customers a direct line to hair care experts and an easy way to buy their favorite products. Under Luna uses Wizard to have 1:1 conversations with their customers, providing personalized recommendations on how to get the most out of their products, and in doing so, they’ve built a loyal and engaged fanbase.

In just two months with Wizard, Under Luna’s text channel increased sales by 8% and drove +70x ROI. Thanks to Wizard’s conversational capabilities, 50% of Under Luna subscribers actively engage in two-way conversations with hair care experts when seeking advice or product recommendations. A win-win for both consumers and Under Luna, and Wizard.

CDU: How are DTC brands using conversational commerce as part of their omnichannel strategies today?

MB: There’s no longer a clear distinction between online and offline channels. Beauty consumers discover products on TikTok, check out the product in-store at Sephora, and later convert on mobile after asking a few personal questions to a virtual CX agent. Winning brands are making themselves available to consumers at any point in the shopping journey, and on every channel of communication, across platforms like web, social and text.

Wizard’s Ai-powered conversational commerce is powerful for these brands because it instantly understands and responds to the consumer’s needs, which can mean the difference between an abandoned cart and a purchase. In doing so, Wizard is bridging the gap in online and offline by powering conversions through conversation and creating a seamless customer journey via text.

CDU: Are there any future plans for further innovation on the Wizard platform?

MB: We recently launched our new WizardAi ChatGPT product that’s based on a combination of our proprietary models and OpenAI models, and integrated into our automated backend to support payments, checkout and orders. WizardAi delivers a first-of-its-kind powerful end-to-end shopping experience via text. We’re so excited about this milestone.