Where AI is creating value in health and beauty

AI is playing a growing role in the health and beauty channel, with retailers and suppliers increasingly embedding the technology across shopper experiences, healthcare services, operations and innovation.  

While early AI initiatives focused on automating routine tasks, the latest developments show businesses using AI to create new revenue opportunities, enhance personalisation and improve productivity. As investment accelerates, AI is becoming a key driver of competitive advantage across the sector. 

Unlocking personalised beauty experiences 

Beauty retailers and brands are using AI to create more personalised and conversational shopping journeys. Sephora recently launched its app within ChatGPT, allowing consumers to receive tailored beauty recommendations, access loyalty rewards and member benefits, and eventually complete purchases through an AI-powered interface. The move reflects changing consumer behaviour, with shoppers increasingly turning to AI platforms to discover products and seek advice. 

Fenty Beauty is also exploring new ways to connect with consumers through AI. The brand recently introduced "Rose Amber", an AI-powered beauty advisor on WhatsApp that provides product recommendations, tutorials and reviews through natural conversations. Customers can ask questions about skin concerns, complete quizzes and receive personalised suggestions across Fenty Beauty, Fenty Skin and Fenty Hair products. 

These developments highlight the growing importance of conversational commerce in beauty. Rather than navigating websites or product catalogues, consumers can increasingly interact with brands through familiar messaging and AI platforms, creating a more personalised and engaging shopping experience. 

Strengthening wellness and advisory services 

Retailers are also using AI to provide more sophisticated wellness and health advice. 

DFI Retail Group has partnered with Samsung-backed technology company Becon to introduce AI-powered skin and scalp assessment technology across more than 400 Guardian and Mannings stores in Asia, as well as through digital channels. The solution combines advanced analysis with personalised recommendations, helping customers better understand their skin and wellness needs while supporting stronger engagement across online and in-store touchpoints. 

Meanwhile, Rossmann has expanded the capabilities of its AI assistant, Rossi, in the Czech Republic. The chatbot can now analyse product ingredients and provide recommendations based on customer allergies, alongside real-time information on prices, promotions and stock availability. According to the retailer, customer enquiries increased by 80% following the update, demonstrating growing consumer confidence in AI-powered guidance. 

As health and beauty retailers seek to strengthen their advisory credentials, AI is helping them deliver expert recommendations at scale while creating more personalised consumer interactions. 

Transforming healthcare and retail operations 

Beyond shopper-facing applications, AI is helping businesses improve operational efficiency and free up employees to focus on higher-value activities. 

CVS Health is leveraging AI-driven prescription interpretation technology to support its pharmacy operations. Using large language models to interpret complex prescription instructions and automate dosage calculations, the retailer has reduced manual administrative work while accelerating prescription fulfilment and patient onboarding. The retailer is also incorporating agentic AI into its Health100 platform, which aims to provide users with proactive health support, improved cost transparency and easier access to healthcare services across multiple providers. 

Elsewhere, South Korean health and beauty retailer Olive Young has rolled out Google's Gemini Enterprise platform across its workforce to improve productivity and decision-making. The move demonstrates how retailers are increasingly applying AI not only to customer experiences, but also to internal processes and business operations. 

Accelerating innovation and software development 

AI is increasingly being used to speed up innovation and improve productivity across the health and beauty sector. L'Oréal recently expanded its partnership with NVIDIA to use predictive AI in beauty research, enabling scientists to simulate ingredient performance and test thousands of formulation variables digitally before physical testing begins. The company says the technology can significantly accelerate product discovery and help bring new innovations to market faster. 

Retailers are making similar investments in their technology capabilities. German drugstore retailer dm is establishing a dedicated AI Accelerator within its IT subsidiary, dm Tech, with the aim of making artificial intelligence a standard part of software development. The team will test AI development tools and agent-based approaches, helping development teams apply new technologies across the organisation. 

These investments reflect a broader shift across the sector. AI is becoming embedded throughout product development, technology functions and business operations. 

AI is becoming a strategic capability 

The latest developments across the health and beauty channel show that AI has moved beyond experimentation. Leading retailers and suppliers are deploying the technology across customer engagement, wellness services, healthcare operations and innovation, creating value for both consumers and their organisations. 

For health and beauty retailers and suppliers, the biggest opportunity lies in identifying where AI can genuinely improve the customer journey, strengthen expert advice and help teams work more efficiently. As adoption grows, businesses that successfully combine AI-driven insights with trusted brands, professional expertise and human interaction will be best placed to drive loyalty, differentiate their offer and accelerate growth. 

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