The Beauty Industry & The 5G Revolution
A key point for the digital transformation
The 5G network will transform the uses of individuals, businesses, and society. This transformation is one of the next significant shifts not to miss out regarding the digital transformation of companies recently accelerated by the pandemic. The beauty industry, like all others, will have to prepare by rethinking its organization and adapting its infrastructures and services to be able to contribute and thus benefit in part from the $13,200 billion generated by 5G by 2035, according to IHS Markit.
What is 5G, what will be the impacts of this technology on the beauty industry, and how should companies prepare for it? All these questions find an answer in this article.
By MEITE Mazéguéla | March 1st, 2021
SUMMARY
1. What is 5G?
2. What will be the impacts of the 5G technology on the beauty industry?
3. How should companies prepare their digital transformation?
- What is 5G?
5G is the abbreviation for the 5th generation wireless network. Contrary to what one might believe spontaneously, the 5G network is not an iteration of the 4G, a sort of 4G+. Indeed, it is a disruptive technology far more powerful than previous generations and offers opportunities for individuals, businesses, and society. The two main characteristics of the 5G network to remember are the following:
• Throughput: the volume of information that the 5G can convey simultaneously is 100 times higher than that of 4G, or a throughput of 300Mbits/s for 4G vs.10GBits/s for 5G.
• Latency: A latency nearly ten times lower, which goes below the millisecond for 5G, against about 50ms for 4G.
In short, 5G allows the transmission of a massive amount of data in almost real-time. From this revolution follows three significant families of uses that have a considerable impact on the economy:
• Communication between machines: between 10k and 1 million connected devices per km2 will exchange data.
• Ultra-high-speed connection: a fiber-like connection with uniform quality of service inside and out.
• Highly reliable data: the information transmission is almost instantaneous, limiting the margins of error between sending and receiving.
5G will allow the emergence of new technologies or the strengthening of existing technologies that up to date could not be fully used given the limitations in terms of throughput and latency of previous networks. Indeed, the speed and quantity of data that can be exchanged via the 5G network widen the field of possibilities.
«With the arrival of 5G, mobile connectivity will go from something we experience mainly through personal devices to being built into the fabric of our society, creating an integrated infrastructure that will connect buildings, transport, and utilities. It will update the operating system of our economy, transforming the energy, healthcare, transport, and retail sectors.»
– Dereck MCMANUS, Chief Operating Officer of Telefonica-owned UK mobile operator O2, for Forbes.
2. What will be the impacts of the 5G technology on the beauty industry?
The introduction of 5G offers the keys to a new economic, technological and digital world. The high throughput of information transmitted almost in real-time between man and machine or between machines themselves will significantly transform companies. What will happen to the beauty industry? Below, three areas of the cosmetics industry impacted:
• Smart Factories: The industry 4.0
The conscious factory will finally see the light of day with a significant impact on performance, safety, and traceability. It will now be possible to set up machines that can exchange relevant data wirelessly only via 5G. This advance will make it possible to follow a product end-to-end and thus promote its full traceability, something impossible until now given the far too large volume of data to convey.It will also be an opportunity to develop quasi-autonomous production chains capable of operating in just-in-time flow and adapting to supply and demand. The sharing of data will help streamline the relationship with external partners (suppliers, OEMs, etc.). Industries will only produce what they need, which will positively influence storage, transportation, etc. This fairer production approach will help companies reduce their carbon footprint. Also, it will be possible to measure energy consumption and losses in real-time, thus promoting more responsible consumption.
The related notions of softwarization, digital twins, and cloud computing are crucial points in transforming industries. Strictly identical backups of the software in charge of the operation of the machines and processes will be saved in the cloud so that in case of malfunction, it will be a question of uploading the saved version to allow an immediate restart of the machine concerned.
The combination of 5G and artificial intelligence will enhance quality checking vision. Combining these technologies will make it possible to identify defects in real-time and avoid the multiple productions of non-conforming units. As a result, manufacturers will see a reduction in losses and a productivity improvement that will promote revenue generation for the company. Augmented reality in a 5G environment will enhance quality control through smart glasses and remote maintenance. Indeed, the immediacy of data sharing will allow a seamless and responsive experience for the operator.
One of the significant implications of 5G is inevitably safety. The installation of sensors will allow predictive security. The low latency of 5G will enable sharing live information to alert any malfunction and avoid minor problems or industrial disasters.
Picture credit: McKinsey Global Institute
• Retail: Phygital stores
With Covid-induced disruptions, including non-essential businesses’ closure, experiential experiences will undoubtedly be the key to returning customers to stores. One of the fundamental pillars of this experience will be personalization. 5G will bring an additional dimension to the so-called phigital stores and hoist the services in retail up to ultra-personalization.
The supply chain will immediately be impacted by the strengthening of traceability promoted by 5G. Inventory management will be done on a just-in-time basis and will therefore be closely linked to customer needs. It will now be possible to store items in-store to reduce delivery times; these stores will be referred to as « dark stores« . Automated delivery will also be included, implying the use of drones and other autonomous vehicles.
The emergence of autonomous vehicles is no longer a dream but a reality. The 5G network and its two major features of low latency and the considerable weight of data that can be shared instantaneously promote autonomous vehicles’ emergence. Indeed, they can share data with each other and their environment; thus, they can anticipate traffic problems, prevent accidents, recalculate their route to promote the fastest way, etc.
Alibaba, through its research center DUMO, develops autonomous vehicles specialized in delivery. Instant delivery, a point addressed in the article « Beauty 4.0: 5 Trends to keep an eye on!« .
The CRM will be at the heart of retail; the customer journey’s follow-up in real-time and the exploitation of data at the point of sale will allow better communication. It will be possible to offer personalized in-store promotions to all customers through pop-up notifications to provide customers with products adapted to their real needs. The data throughput supported by the 5G network will make it possible to offer more real-life immersive experiences through augmented reality and artificial intelligence. Smart mirrors and virtual try-on technologies will offer more responsive experiences, thanks to the low latency of 5G that inhibits the lag between the individual’s movements and the projected AR.
We will discuss phygital stores in detail in the upcoming article « Phygital: The Beauty Store of the future. »
Picture credit: Premium Beauty News – SK II Phygital beautynstore CES 2019
• Connected devices: Internet of Things (IoT)
In this quest for ultra-personalization, connected objects will be key elements to maintain contact with the customer remotely and acquire relevant data to promote the online and offline customer experience.
Connected devices will be able to analyze more complex data simultaneously thanks to 5G throughput. It will now be possible to follow up with the customer and perform predictive analyses through connected mirrors to anticipate possible inconveniences such as a future acne outbreak or the appearance of hyperpigmentation on the face. The smart device will therefore recommend the most appropriate product. Connected mini-fridges in which some consumers store their cosmetics will analyze their contents to determine if another order needs to be placed and place the order if necessary.
Thanks to the coupling of augmented reality and 5G, it will also be possible to take part in a completely immersive way and not as a mere spectator in virtual experiences such as livestreaming, consultations with professionals, store events, etc.
The implementation of 5G and its association with technologies such as artificial intelligence or augmented reality or its coupling to connected devices are opportunities for companies to collect data, foster a customer experience with real added value and ultimately capture value.
Picture credit: Lavangardiste.com – HiMirror Mini
3. How should companies prepare their digital transformation?
According to IHS Markit, the 5G economic impact is estimated at $13.2 trillion by 2035, or 5% of the total economic value, and a contribution of 0.2 points in the annual global economic growth 2020-2035. The transformation induced by 5G will affect the entire business value chain (Comex, supply chain, Marketing, HR, etc.). Human resources will have to be able to identify the talents to have within companies and the profiles that are destined to disappear to train them and anticipate a fluid transition to other functions. Purchasing departments will have to adapt to management in just-in-time flow to adhere to a more sustainable production logic. Marketing departments will need to adjust to new products and services, etc.
Here are some answers to help you integrate and operate 5G in your businesses:
• Breaking down silos so that the entire value chain can enjoy the benefits of digital and so-called new technologies and the resulting transformations. The organization will have to be built around the customer; companies will have to be more customer-centric.
• Changing mindsets to encourage the full and efficient use of technologies. Bringing technology and digital is not enough. If the employees are not in a state of mind to exploit them and are not aware of what they can do with them, the companies’ transformation will not take place.
• Rethinking organizations. The logic of creating departments based on expertise (e-commerce, IT, CRM) could become obsolete. Indeed, an approach to information sharing with the whole company seems more appropriate to promote the integration of data and digital at all levels of the organization. As a result, the GDPR processes will have to be perfectly integrated. Agility and co-construction will have to be part of it. The different levels of organizations will need to be better integrated.
• Partnerships and tech will be key to companies’ success in generating innovation and bringing together diverse expertise not held within companies in an isolated way.
• Having a predictive vision of the business and knowing how to anticipate the rapid changes in digital and new technologies to position itself effectively in the market.
Companies must implement their « 5G strategy » by reorganizing, adapting their equipment or acquiring new ones, establishing partnerships to generate innovation. This strategy of anticipation and adaptation will enable companies to seize the opportunity to capture value.
Sources: Forbes | Orange | McKinsey Global Institute | Thalès | Techniques de l’Ingénieur | Havas Paris – Parole d’Expert: Laurent Fauroux, Partner Gate One Consulting – 5G: La Révolution numérique est en marche
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MEITE Mazéguéla