As beauty brands and retailers are trying to master their brand experience, it is clear there is a need and an opportunity for a more comprehensive approach to measuring the performance of beauty tech solutions effectively
Like navigating complex consumer journeys and juggling competing priorities, tracking and analyzing key metrics in beauty tech requires regular attention and comes with a certain level of risk. Especially in beauty tech, many brands can be drowned in a sea of data and, even worse, start chasing down vanity metrics.
But what are the hero metrics for AI/AR-powered beauty personalization, and how to track them effectively?
Beauty tech is beginning to form a powerful new way for beauty brands to impact their overall business metrics. But key performance indicators don't mean much unless you know what metrics and data to track and how to contextualize them. Distinguishing between vanity metrics and actionable metrics will paint a clearer picture of what your data is telling you.
That's why we compiled this list that helps beauty brands and retailers start or continue with their beauty tech journey and look at the hero metrics that matter:
1. Engagement and E-commerce Revenue:
The more seamless and personalized shopping experience a brand can provide today to customers will win the loyalty of their customers today and in the future. Moreover, delivering an engaging shopping experience will help you earn users time, leading to more time spent on site and enabling the discovery of new products.
A fantastic way of measuring if your newly deployed AI/AR-powered personalized experience impacts the revenue during specific seasons is by looking at engagement and e-commerce revenue.
When comparing the engagement rates of general users and users that engage with Revieve-powered experiences, we've seen how our partner's overall e-commerce revenue was 1.3x higher during the 2021 holiday season.
Looking into specific holiday seasons can help you optimize for each upcoming season by recycling what worked last year or trying new ways to promote your newly deployed experiences.
2. Time Spent on Site and Conversions:
As more consumers move online, there is an increased need for personalization because, as a brand, you’re competing today for your customer’s attention. Customers are happy and satisfied when they spend time looking for relevant information, and in this day and time, brands can achieve that by offering personalized content. Delivering a personalized shopping experience that educates and guides consumers to the right products can help your customers spend more time on site.
However, time spent on site does not say much unless combined with an actionable metric such as conversions. Tracking conversions individually is an excellent indicator of success, telling you immediately if your newly deployed experience is engaging and performing as expected. Moreover, higher conversion rates prove that your newly deployed experience is tailored correctly to your audience - as they are essentially converting based on relevant recommendations. For example, our partner, A.S. Watson Group retailer, Superdrug users converted over 100% better, and ICI PARIS XL users spent twice the amount of time on-site with an AI Skincare Advisor powered by Revieve.
But regardless of the personalized experience you provide, you need to be able to make it extremely easy for your customer to buy just with the click of a button. Standalone solutions like virtual makeup try-on are ideal for entertaining and discovering new products. Still, they might fail to help consumers complete a purchase as they are not designed as an end-to-end experience.
This is why we introduced our newly launched AI Makeup Advisor to the market. It is an end-to-end alternative to a standalone makeup virtual try-on. It can help your customers discover, virtually try on makeup, and get recommended makeup products suitable for their skin type and needs - all within the same engaging and interactive experience.
3. Average Order Value (AOV) and Lifetime Customer Value (LTV):
Every brand must retain its online shoppers and increase average order value (AOV) to stay ahead of the curve. In particular, product recommendations are an effective way to personalize the customer experience and increase its AOV. Experiences like our advisor suite allow consumers to explore different suitable categories simultaneously, thus boosting the average purchase value.
Personalized product recommendations help target a wide range of consumers, assist in quickly discovering relevant products, and encourage them to purchase complete care routines or individual items. For instance, during Q2 2021, No7 Beauty Company saw that with an AI Skincare Advisor powered by Revieve, the average order value increased by 48%.
AOV, when viewed individually, can be an excellent immediate indicator of whether your new solution/experience is yielding results. However, you want to focus on the long-term performance of your investment.
LTV is one of the most critical metrics you need to determine if the percentage of users engaging with your brand through personalization is yielding better results over time.
However, based on our experience, LTV is a metric that varies from partner to partner on how it's calculated and defined. At Revieve, we use Google Analytics's LTV Report and the first 90 days of usage of the solution for the basis of the calculation.
From our observation, on average, our partners see a 3.5x increase in LTV with users that engage with Revieve-powered experiences.
4. Retention and Return Rate:
The goal of personalizing your brand experience is to build a relationship with your customers so that they always come back to you. And consumers today genuinely crave a personalized experience. For example, Klarna's latest Shopping Pulse shows that 40% of global consumers expect personalized product recommendations online.
Providing your customers with a personalized brand experience today will help you live up to customers' needs and keep them coming back for more. This is critical for most beauty brands as customer retention has become a crucial KPI amidst rising competitors.
Let's take our AI Skincare Advisor experience as an example. We've observed that the experience amongst our partners has helped them improve the results in repeat purchases (retention), product referrals, and how often consumers tend to re-purchase (return rate).
For instance, our partner SKIN FIRST® has seen how engaging the AI Skincare Advisor experience powered by Revieve is for consumers, as 34% return after Face Decoder's previous usage.
Ready to Personalize Your Beauty Brand Experience?
Brands should look for an enterprise-grade partner for a strategic and long-term relationship to personalize their brand experience and set processes, determine KPIs and track hero metrics to measure effectiveness and success moving forward.
At Revieve, we're proud to have developed a complete end-to-end beauty-health-wellness offering spanning all beauty categories: skin, makeup, haircare, suncare, and nutrition. Our razor-sharp focus on beauty with an advisor and coach approach in all our solutions make us the preferred choice for both medium-sized beauty brands and established brands retailers.
Moreover, based on analytics and best practices, we have developed a 90-day Engagement Program to support our partners in activating, monitoring, and optimizing their newly deployed experiences with us.
If you're curious to learn more about how Revieve can boost your revenue and improve your sales and conversion rates, contact us today!