Three Significances Blockchain Technology Brings to the Beauty Industry

Author: Megan DeMatteo, COINDESK; Compiler: Songxue, Jinse Finance

It may seem counterintuitive, but beauty brands are exploring how to engage with consumers in the blockchain space and metaverse.

In the world of beauty and fashion, creative collaborations are everything. New York's Metropolitan Museum of Art has been collaborating with several iconic beauty brands over the years—including releasing a custom-designed Estée Lauder eyeshadow palette for the art institution's 150th birthday.

A good collaboration in any industry pushes boundaries and inspires clients to experiment with new ideas and forms of self-expression. So it's no wonder skincare and color cosmetics brands are jumping into Web3.

Through new forms of digital art and cutting-edge technological innovation, today's leading beauty companies hope to reach Web3-native consumers, create meaningful experiences, and possibly even clean up their supply chains.

Blockchain Technology Can Help Brands Reach New Audiences

Yann Joffredo, global brand president of NYX Professional Makeup, said the L'Oréal-owned cosmetics brand has always championed inclusivity through its collaborations with independent content creators, bloggers and makeup artists. **Joffredo believes that Web3 has the added benefit of connecting with new audiences. **

"As brands continue to evolve, it's important to champion the same representation in Web3," Joffredo said. "In addition, we understand unexplored areas of beauty in the metaverse."

In early 2023, NYX launched GORJS, the world's first beauty-focused decentralized autonomous organization (DAO), aiming to focus on creators building beauty experiences in the Web3 ecosystem.

"GORJS brings together artists and beauty enthusiasts in the Web3 space to lead the cultural conversation around the digital make-up art space in virtual worlds and beyond," said Joffredo.

Blockchain Technology Offers Meaningful Self-Expression Opportunities

Transparency and self-expression in the metaverse are a natural extension of NYX Professional Makeup's brand values, Joffredo also said, adding that the digital space offers beauty lovers unique avenues to express themselves and interact with products.

**Digital spaces can also provide physical security in a politically polarized real world. **Last year, NYX partnered with inclusive avatar company People Of Crypto (POC) and user-generated virtual environment The Sandbox to launch a week-long celebration of Pride Month. The campaign features gender-non-conforming NFT avatars with makeup in pixelated or "voxelized" fashion, using colors representing the Progress Pride flag.

During a recent panel discussion at the Extended Reality (XR) industry conference, Maya Kosovalic, VP of Digital Innovation and E-Commerce at AWE Live, NYX, spoke about a more immersive digital future: “Self-expression is really the core of the gaming platform experience of the future. Users, instead of a single, isolated game loop, can get a very immersive and engaging social experience where the younger generation can interact with their real-life friends."

She added that **expressing a person's personality and identity through skin and digital goods is exactly why Web3 is so interesting for beauty and fashion brands. **

Agustina Sartori, senior director of innovation at Ulta Beauty, an American beauty chain, was also on the panel. "Beauty is a way of being yourself and becoming who you want to be," she says. "Why don't we care about beauty-related things in the digital world?"

According to Sartori, Ulta Beauty has been experimenting with digital activations on Roblox since 2022. Roblox is a popular user-generated gaming platform that doesn't use blockchain technology or cryptocurrencies, but still attracts major brands interested in building virtual worlds for their clients. Ulta's virtual Roblox world is called the "Ultaverse." In May, Ulta Beauty teamed up with eye shadow brand Urban Decay to host a virtual party inside the Ultaverse. Makeup influencers Emmy Combs, Leilani Green and Manny MUA hosted the event, which attracted about 500,000 visitors, Sartori said.

Blockchain technology can solve the trust problem

**Finally, blockchain technology offers a potential solution to one of the most common challenges facing the beauty industry: green cleaning. **Clean beauty brands have been coming under increased scrutiny in recent years amid growing pressure from market demand for products that are cruelty-free, eco-friendly and natural.

It is nearly impossible for consumers to trace the source of ingredients for their favorite brands. But now, blockchain has many supply chain-related use cases — most of which are still new. French luxury skincare company Clarins has created a blockchain-based platform that allows customers to trace the manufacturing process of their products on-chain. **By scanning the QR code on each package, people can trace the source of the ingredients, learn how the product was made and even packaged. **

Another way blockchain technology can help solve trust issues is by weeding out counterfeit products, a growing problem in the world of “hyperfakes.” Luxury fashion giant LMVH has used blockchain technology to help prove the authenticity of Louis Vuitton handbags and Dior fragrances.

Blockchain experiments by other beauty brands include an experimental bitcoin "cash-back" program that rewards consumers with every product they buy as an incentive.

Exciting prospect of beauty industry based on blockchain technology, but still in experimental stage

As we’ve seen with every aspect of Web3, the beauty industry is still experimenting with how best to use blockchain technology to make a lasting impact across its existing and emerging customer base.

"It's a process and it takes time," said Leya Kaufman, senior vice president of brand, publisher and sales at media company Coveteur. "We need to cultivate and engage an audience in this new space while maintaining our core consumer base," she said.

Together with MoonPay, a leading Web3 infrastructure provider, Coveteur has partnered with haircare company Wella Professionals to launch The Wella Generator, a gamified digital sweepstakes hosted on the Ethereum blockchain.

"Creating a flawless program for existing and new Web3 users was important to us," Kaufman said, adding that the partnership with MoonPay made this vision possible.