AI in Beauty and Cosmetics Market Report 2025

The AI in beauty and cosmetics market size has grown rapidly in recent years. It will grow from $3.72 billion in 2024 to $4.4 billion in 2025 at a compound annual growth rate (CAGR) of 18.3%. The growth in the historic period can be attributed to personalized beauty recommendation, skin analysis and diagnostics, virtual makeup artists, social media influences, enhanced customer engagement.

The AI in beauty and cosmetics market size is expected to see exponential growth in the next few years. It will grow to $9.44 billion in 2029 at a compound annual growth rate (CAGR) of 21%. The growth in the forecast period can be attributed to AI in product formulation, ai-generated content creation, AI in augmented reality (AR) shopping, smart beauty devices, data-driven personalization, AI in sustainability practices. Major trends in the forecast period include color-matching technologies, virtual try-on technologies, personalized beauty recommendations, chatbots for customer support, AR-based beauty content creation.

The increasing demand for personalized beauty and cosmetic products is projected to drive the growth of AI in the beauty and cosmetics market in the future. Personalized beauty and cosmetic products are tailored to meet each customer's individual preferences and needs, encompassing aspects such as ingredients, textures, fragrances, and packaging. AI plays a crucial role in creating personalized beauty and cosmetic experiences through data analysis, image recognition, formulation optimization, and virtual try-on technologies. For example, in August 2024, the International Trade Administration, a US-based government agency, reported that over 60% of Vietnamese consumers use skincare products daily, indicating a strong demand. A 2022 study by Q and Me revealed that 95% of women aged 25 to 45 regularly utilize these products, spending an average of 740,000 VND (approximately US$30) per month. Therefore, the increasing demand for personalized beauty and cosmetic products is fueling the growth of AI in the beauty and cosmetics market.

The burgeoning popularity of social media is poised to drive the expansion of AI in the beauty and cosmetics industry. Social media platforms, comprising online networks and websites facilitating content creation, sharing, and virtual social interactions, serve as fertile ground for AI integration within the beauty and cosmetics sphere. AI applications in this domain leverage social media for personalized product recommendations, virtual try-ons, and heightened customer engagement strategies. For example, as reported by DataReportal, a Singapore-based online reference library, global social media users reached 4.62 billion in January 2022, marking a noticeable surge from 4.19 billion in January 2021. Consequently, the escalating prevalence of social media platforms stands as a significant driver propelling the integration of AI technologies within the beauty and cosmetics market.

Technological advancements stand as a prominent trend gaining traction in the AI for beauty and cosmetics market. Companies within this domain are actively embracing new technologies to fortify their standing in the market. For example, in January 2023, The Estée Lauder Companies, Inc., a leading US-based manufacturer and marketer of makeup, skincare, fragrances, and hair care products, unveiled the Voice-Enabled Makeup Assistant (VMA) application. The VMA leverages voice teaching technology to assist users in their makeup application process, offering audio guidance and tips for achieving even application of lipstick, eyeshadow, or foundation. Employing artificial intelligence, the ELC VMA detects makeup on the user's face, estimating uniformity, application thresholds, and coverage. It identifies areas requiring more precise application and provides prompts for touch-ups to achieve optimal results.

Leading companies in the AI in beauty and cosmetics market are concentrating on creating AI-powered technologies, such as mirror technology, to enhance the shopping experience and increase consumer confidence in their product choices. Additionally, AI-driven data analytics enable brands to identify trends and preferences, helping them maintain a competitive edge. Mirror technology includes advanced reflective surfaces that manipulate light and images, featuring applications like smart mirrors and optical systems, including augmented reality and adaptive mirrors for improved functionality. For instance, in January 2023, Estée Lauder, a US-based cosmetics company, introduced a voice-enabled makeup assistant designed to help visually impaired users apply makeup independently through real-time audio feedback and facial recognition technology, promoting accessibility and inclusivity in the beauty sector.

In June 2024, The Estée Lauder Companies Inc., a US-based cosmetics firm, acquired DECIEM Beauty Group Inc. for an undisclosed sum. Through this acquisition, The Estée Lauder Companies Inc. aims to improve its skincare portfolio and connect with younger consumers by leveraging DECIEM's innovative approach for global expansion. DECIEM Beauty Group Inc., a US-based beauty company, utilizes AI to enhance product personalization, streamline development processes, optimize inventory, and improve customer experiences within the beauty industry.

Major companies operating in the AI in beauty and cosmetics market include Procter & Gamble Company, Pure & Mine, L'Oréal S.A., Sephora Inc., Beiersdorf AG, Shiseido Co. Ltd., Elizabeth Arden Inc., OpenAI LP, GAN-powered solution, Anokai, EpigenCare Inc., Novi, Perfect Corp., Lottie London, Banuba Inc., Luna Fofo, Revieve, Ciaté London, mySKIN, Haut.AI, YOUS Skincare, My Beauty Matches, Youth Laboratories, Opte Wand, Perso Limited.

North America was the largest region in the AI in beauty and cosmetics market in 2024. The regions covered in the ai in beauty and cosmetics market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the ai in beauty and cosmetics market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

AI in beauty and cosmetics harnesses sophisticated artificial intelligence and machine learning methods to analyze and understand various facets of beauty and cosmetics. This technology aims to offer optimal beauty matching by enabling facial visualization, skin assessment, and delivering personalized recommendations for skincare and potential treatments.

The primary categories within the AI in beauty and cosmetics market include personalized recommendation tools, performance marketing measurement platforms, demand forecasting and supply chain tools, real-time customer service platforms, and AI-powered beauty devices. Personalized recommendation tools encompass software systems or algorithms analyzing user data to offer tailored suggestions based on individual preferences, behaviors, and choices. These tools find distribution through various channels such as specialist retail stores, supermarkets, online retail, and others, catering to skincare, haircare, makeup, fragrances, and related segments.

The AI in beauty and cosmetics market research report is one of a series of new reports that provides AI in beauty and cosmetics market statistics, including the AI in beauty and cosmetics industry global market size, regional shares, competitors with an AI in beauty and cosmetics market share, detailed AI in beauty and cosmetics market segments, market trends, and opportunities, and any further data you may need to thrive in the AI in beauty and cosmetics industry. This AI in beauty and cosmetics market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The Artificial intelligence in the beauty and cosmetics market includes revenues earned by entities through personalized product suggestions, skin analysis chatbots, smart mirrors, and virtual assistants. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included. Artificial intelligence in the beauty and cosmetics market also includes sales of smart skincare devices, smart mirrors, smart makeup tools, smart hair tools, and custom fragrance creation. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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