During the Covid-19 pandemic, customers have spent less money and time shopping in-store and more online. As lockdowns, work-from-home policies, and mask-wearing practices discourage people from wearing makeup, beauty retailers have doubled down on digital marketing in response to the decline in sales.
Perfect Corp., a Taiwanese startup developing virtual try-on technology, is turning the growing demand for digital solutions into an opportunity. The company has recently raised a US$50 million Series C round led by Goldman Sachs to advance its AI and AR technologies and expand its global presence.
The round brought the company’s total fund raised to more than US$100 million. It announced a US$25 million Series A financing in 2017.
Perfect Corp., based in New Taipei, is known for its beauty app YouCam Makeup. With the app, consumers can try on makeup samples virtually from more than 300 beauty brands, including L’Oréal, Estée Lauder, and Lancôme. In addition to taking augmented selfies, they can also watch makeup tutorials and live-streaming videos by beauty influencers.
The app now has 40 to 50 million monthly active users and its virtual try-on function is used more than 10 billion times per year. The company told The News Lens its largest bases of users are in the United States, Brazil, and India.
Last December, the company created an AR-powered makeup try-on tool for Google Search. When consumers search for a certain product, they will come across photos of various skin colors, try it on their faces, and compare to find the best one for themselves. Perfect Corp. also provides their service on social media apps like Snapshot and YouTube.
Most of Perfect Corp.’s clients are cosmetics and skincare brands. With facial recognition and real-time rendering technologies, the company aims to create an experience similar to that when customers try on lipsticks, eye shadow, or foundation in real life. The pandemic has boosted the use of their mobile app service by 32%, the company said.
Xinyi Feng, a managing director in the Merchant Banking Division of Goldman Sachs, said, “The integration of technology through artificial intelligence, machine learning, and augmented reality into the beauty industry will unlock significant advantages, including amplification of digital sales channels, increased personalization and deeper consumer engagement.”
While developing apps, Perfect Corp. provides its solutions in physical stores. Interacting with a touchable screen, shoppers can pick up a random cosmetic or skincare product and see it applied to their face instantaneously.
During the pandemic, customers are becoming more cautious about what they touch in public. In response, Perfect Corp. adds several new features to its virtual try-on technology, including gesture control and voice activation. In-store devices incorporating the technology also detect customers’ masks and allow them to try on cosmetics like eye shadow without taking them off.
In places worst hit by Covid-19, the company said it helps beauty retailers launch virtual consultations, allowing customers to try on cosmetics products and receive expert advice without leaving home.
Cosmetics sales are declining during the health crisis, but interest in skincare products remains strong. Perfect Corp. recently rolled out an AI-powered skin diagnostic tool to offer real-time skincare analysis by detecting wrinkles, spots, and dark circles. The solution makes it easier for beauty brands to understand their customers’ skin conditions and offer personalized skincare advice.
The company claims to be the only provider of a virtual try-on experience “of all types of beauty products and in all types of application scenarios,” including physical stores, social media apps, and e-commerce sites.
Alice H. Chang, CEO of Perfect Corp. said, “This Series C investment will further drive the development of our solutions globally across all beauty categories and channels for the complete 360 beauty SaaS experience for consumers.”
Taiwan, which exports many of the world’s advanced chips and electronics, is not known for software startups. But Perfect Corp. said it has benefited from the large pool of software talents that the country has to offer to develop its technologies.
However, Taiwan’s market size may put local companies at a disadvantage. “The size of the domestic market, as well as the limited budget that businesses have for software services, makes it difficult to stay in the market we are most familiar with,” the company said. “Facing global markets is the only way to grow and thrive.”
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TNL Editor: Nicholas Haggerty (@thenewslensintl)
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