THE PERSONALISATION REVOLUTION: HOW ARTIFICIAL INTELLIGENCE IS TRANSFORMING THE COSMETICS INDUSTRY, MAKING CONSUMERS THE SOURCE OF INNOVATION

Abstract

The article focuses on the use of artificial intelligence (AI) in driving personalisation within the cosmetics industry, emphasising its potential to shift from mass-market production to highly customized skincare solutions tailored to individual consumer needs. The purpose of the paper is to examine how AI-powered personalisation can redefine business strategies, enhance consumer satisfaction, and establish competitive advantages for cosmetic brands. Methodology. The research employs a comparative analysis of current market practices and strategic forecasts for AI adoption in cosmetics. The study draws upon a range of sources, including case studies, industry reports, and technological advancements, in addition to the beauty market, in order to assess the viability and the challenges associated with the implementation of AI-driven personalisation. Results. The article concludes that AI-driven personalisation offers significant opportunities to revolutionise the cosmetics industry, enabling brands to meet individual consumer demands efficiently. The necessity of localized manufacturing, flexible production processes, and adaptive logistics to address challenges is highlighted. The findings emphasise the transformative capacity of consumer-driven innovations in shaping global beauty market dynamics. The analysis demonstrates that AI-driven personalisation facilitates a transition in cosmetic brands from mass-market strategies to individualised product development, thereby fostering enhanced consumer engagement. However, the research identifies key challenges, including the need for adaptable production processes, streamlined logistics, and localized manufacturing to meet rapidly evolving consumer demands. Practical implications. The findings suggest that brands adopting AI-driven personalisation can achieve a competitive advantage by offering tailored skincare solutions, enhancing consumer loyalty, and capturing niche market segments. Investment in local production facilities and flexible supply chains is critical for the efficient delivery of customised products. Furthermore, brands are able to leverage their technological and beauty innovation expertise to gain a dominant position in global markets by aligning personalisation strategies with diverse consumer preferences. Value / Originality. This study provides a unique perspective on the integration of AI into the cosmetics industry, emphasising the strategic importance of consumer-driven innovation. By focusing on the potential for leadership in this transformation, the research offers valuable insights for industry stakeholders aiming to harness AI for market differentiation. The originality of this study lies in its exploration of how AI-powered customisation can redefine traditional business models and establish new standards in the global beauty industry.