Chances are greater this year that when a woman is glued to her phone she might be on a beauty app. Although there are a myriad of brands on the market, usage for the cosmetics category has lagged. That’s about to change, begging the question: Could apps supplant beauty advisers?

This story first appeared in the March 2, 2016 issue of WWD. Subscribe Today.

Beauty apps are poised to make a much bigger impact on the cosmetics business this year, according to a recent Kline & Co. study, “Going Digital: Who’s Who in the World of Beauty Apps.” That explosion should buoy the bottom line. Experts said that within beauty apps, the sales are small. But the real payoff is the impact they have as far as assisting overall sales either by boosting brand awareness, social engagement or direct assistance at retail. That total is estimated to represent 40 to 50 percent of a parent brand’s sales.

There are numerous beauty apps from brands, third parties and retailers. But Kline found a usage gap, suggesting there is huge untapped potential.

Kline saw that consumers spent 85 percent of their mobile time on apps, with the average user downloading more than eight per month. But the analysts noticed beauty was not where people were spending a great deal of time.

Make no mistake; apps are already an integral part of any beauty campaign, especially for fledgling brands without big advertising dollars. “We saw that leveraging social media was one of the most successful factors in the emergence of independent brands,” explained Kelly Alexandre, an analyst at Kline.

Experts predict that 2016 could be the year of the beauty app. Mintel found 45 percent of beauty consumers prefer to search product information on mobile devices rather than ask for help from a sales associate. That prompts the question of whether more dollars should be rerouted into technology rather than in-store support.

“Smartphones and tablets are playing an increasingly pivotal role in the beauty retail experience. Brands should assume that their audience has a connected device at their fingertips at all times and should look to leverage behavioral research in order to better understand when and how consumers are using these devices,” said Mintel’s senior research analyst of retail and apparel Diana Smith. “The beauty category is ripe for an explosion of technology-driven innovation.”

Perhaps the source with the best vantage point to answer the apps-versus-live-service question is Dr. Parham Aarabi, founder and chief executive officer of ModiFace, a developer of augmented reality. “We have seen beauty apps change from fads mostly used by teenagers to substantive and useful tools used by consumers before, during, and after purchasing beauty products,” he said.

But his vision isn’t apps replacing humans. “In particular, we have seen beauty apps be most effectively used by beauty advisers to educate consumers on what is possible and to explore the best product for each person during the purchasing process.” While in some cases—more likely in the mass market, apps are replacing beauty advisers. “But by far the impact of beauty apps has been to augment and empower advisers to give more personalized choices to consumers,” he said.

Kline’s Alexandre agreed based on her company’s research. “I think for the time being, in-store beauty consultants are still necessary as consumers get accustomed to the idea of using technology as their own personal beauty consultant,” she said. But as the nation’s demographics change and a generation weaned on apps emerges, the role of in-store consultants could morph into something new. “I think that beauty consultants will need to start incorporating more technology into their consultations if they want to keep up with the competition of apps. Tools to scan the face to recommend products will likely be the future,” Alexandre said.

A new NYX store in Willowbrook Mall in Wayne, N.J., shows that theory in action. The store fuses technology with touch. At the center of the store is an interactive makeup station with NYX tutorials. Shoppers can scan product barcodes and get detailed product information including price and how to achieve a look. Maria Fesler, NYX senior vice president of operations, said customers in that particular store seek out store assistance to assist with technology or find recommended products.

So where is the app action?

To comprehend the types of apps available, Kline researched 65 apps that have beauty as the primary focus. They divided them into forms: in addition to brand or company and retailer options, four other general classifications are assessment apps, beauty on demand, community/educational/inspirational and virtual makeovers. Kline scrutinized and cataloged 23 beauty apps that represent some of the best.

The company sees a great deal of opportunities in virtual makeovers, such as those developed by the rapidly growing ModiFace.

According to ModiFace’s Aarabi, more than 50 beauty companies are embracing augmented reality via mobile app or in stores. Most recently, ModiFace announced additional uses of augmented reality, such as an antiaging mirror, in partnership with Allergan as well as collaboration with L’Oréal Color Matrix. This app, called the Matrix Color Lounge, simulates an application to show users how 10 hair effects would look.

“The technology has only scratched the service and is expected to balloon in 2016,” promised Aarabi. “When done well, augmented reality is very effective,” he said. With a larger client base under its belt, ModiFace now has numbers to put behind claims. Brand awareness of shades featured rose 180 percent. Social engagement soars 250 percent because people like to share their images. In stores, virtual mirrors push sales up 31 percent. “In retail, a 1 percent gain is great, 31 percent is game changing,” said Aarabi.

Also offering virtual makeovers is Perfect Corp.’s YouCam, which Alexandre believes is positioned to attract more users, especially young customers who want to “try before they buy.” YouCam just announced the first virtual showroom in conjunction with Ardell’s false eyelashes. That was followed by Perfect Corp. teaming with Elizabeth Arden to feature a comprehensive assortment of Arden’s skincare-infused color cosmetics within its virtual makeover interface, with the option for direct purchase from Arden.

“The app simplifies product discovery and provides both an entirely new and existing customer base with unprecedented access to the Elizabeth Arden portfolio,” said JuE Wong, president, Elizabeth Arden Brand. “Additionally, it will provide the brand with millions of real-time consumer insights as we analyze product popularity and purchase funnel to cater to and customize the personal needs of our consumers.”

Alice Chang, ceo of Perfect Corp., provided numbers showing the YouCam Makeup app achieved 100 million downloads just less than 18 months after its launch. “Trends are pointing toward spectacular growth in 2016, as we continue to improve our apps’ features, content and user experience. Perfect Corp. is committed to remain a pioneer and leader and help drive innovation in the beauty industry.”

Augmented reality, said the experts at Kline, allows consumers who used to have to go into stores to try on cosmetics or seek the knowledge of salespeople, the chance to simulate trial without leaving home. But augmented reality, especially as Wi-Fi is added to stores, has brick-and-mortar capabilities as well.

Plum Perfect is another app where Kline sees great potential for beauty manufacturers. It was launched in 2012 to reduce the frustration over the overwhelming color choices. The idea is to offer a personalized approach without the help of an in-store expert. The app scans a user’s face and analyzes it to reveal a Color Signature. From there products from brands and retailers are recommended that would complement the user’s skin tones.

What will it take to move the needle on beauty app usage and find ways to monetize the technology? Among the features Kline sees as must-haves for apps are barcodes to scan products in stores, everything in one site from prices and coupons to ingredients and a shopping function.

Indeed, consumers are turning to technology as a cost-saving measure, with nearly three in five (58 percent) interested in mobile apps that provide beauty product offers to be redeemed in-store, said Mintel. Coupon redemption is popular among beauty retail shoppers as nearly half (47 percent) have turned in coupons using their smartphone or tablet when purchasing products in-store or online. Further, 54 percent of beauty retail shoppers are interested in apps that allow them to compare prices.

Just good old plain fun needs to be injected into apps, too. Bridget Dolan, vice president of Sephora’s Innovation Lab sees a future in edutainment — a mash-up of education and entertainment. Sephora has been at the forefront of digital innovation such as a contouring app where people can apply products to an uploaded selfie. Next up: Sephora will launch an interactive game—a tactic that has been a winner in the app world.

Although the jury is out on how and when apps can turn profits, Karen Doskow, director for the Consumer Products practice of Kline, said the real benefit is the power to build relationships. “A brand’s key differentiator can be investment in beauty apps. They establish a dialogue with consumers and build loyalty,” she said. “And it is certainly a path to purchase.” ■