Shiseido uses technology to create new streams of revenue

Shiseido uses technology to create new streams of revenue

Shiseido uses technology to create new streams of revenue

SHISEIDO is an interesting cosmetics company with a strong international presence and an ever-increasing love for technology.

The Japanese company has been experimenting with new and emerging technologies for the past few years, launching a digital counseling mirror way back in 2017 and more recently, absorbing technology startups to create intelligent beauty solutions for customers.

Now, according to Bloomberg, the company is piloting an app in Japan that charges JPY10,000 (approx US$92) per month to analyze customer’s skin and comes with a cylindrical dispenser with five serum cartridges.

Christened Optune, the app and dispenser offer customers a personalized formula twice a day — with as many as 80,000 different combinations.

The app not only uses photos to analyze the customer’s skin but also absorbs data about the sleep cycles rhythms and menstrual cycles along with weather conditions and air pollution, in order to deliver the right mix of serums.

According to SMBC Nikko Securities Analyst Shima Yamanaka, the offering could rake in up to JPY67.9 billion (0.63 billion) in annual sales.

“Shiseido sees advantages in the lack of marketing costs and better attachment with customers,” explained Yamanaka.

Shiseido launched Optune from July 1, 2019. Source: Shiseido

Shiseido launched Optune from July 1, 2019. Source: Shiseido

While the product launch has just made a splash on the international scale, it seems as though Shiseido had been beta testing this offering since December 2017.

According to Shiseido, the 2017/18 product offered 1,000 patterns of skincare, which has been scaled to the 80,000 combinations offered by the new release of Optune.

The variety of solutions that Optune now provides is also reinforced with an analysis of external factors including pollen.

Shiseido also claims that Optune can sense the users’ sleep conditions and provide a one-week solution to prevent rough skin which may result from biological rhythm disruption of any sort.

Digital creates new streams of revenue for brands

Over the past few years, companies have talked about using digital to create new revenue streams.

Businesses such as HP’s printer division and Rolls Royce’s aircraft engines division succeeded — but not many other organizations could follow in their footsteps.

Japan’s Shiseido, however, seems to be another example that joins the list of companies that successfully leverage technology to create new streams of revenue for its brands.

The company officially calls this product an “IoT solution” because it uses sensors and connects to the company’s network to gain access to the proprietary formulation for the specific skin type — putting it squarely within the digital products space of the next-generation.

Overall, Shiseido finds that the Optune line allows it to exceed customer expectations by providing something that is not only personalized to their skin but also helps them deal with changes in their body — over time — requiring continued personalization.

For now, Optune might only be available in Japan, but over the next few months, there’s a high chance that the product will make a debut overseas, especially in the Southeast Asian market, as confidence among stakeholders and customers is high and continues to grow.