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  James Kotecki (00:32): 
  
  This is CES Tech Talk. I'm James Kotecki. 
  
  (00:36): 
  
  CES 2024 is January 9th through 12th in Las Vegas, and it is time to build that hype. So let's get smart about the world's most influential tech event. And of course, nothing says influential like a CES keynote address. And at CES 2024, L'Oreal's CEO, Nicolas Hieronimus, will take the stage to deliver the event's first ever keynote from a beauty company. 
  
  (01:01): 
  
  And joining me now to talk about the future of beauty tech is L'Oreal's Global managing director of Augmented Beauty and Open Innovation, Guive Balooch. Thank you so much for joining us, Guive. 
  
  Guive Balooch (01:12): 
  
  Thank you for having me. 
  
  James Kotecki (01:13): 
  
  Okay, so first of all, you have an awesome title, Managing Director of Augmented Beauty and Open Innovation. What does that actually mean at L'Oreal? 
  
  Guive Balooch (01:21): 
  
  Well, I've been at the group now for 16 years. It's hard to believe but it's 16 years now. And I run two entities within the research and innovation of the group. The first is all of the tech and services that go around the combination of science, technology, and beauty together. So all of that kind of what we're coming to the CES for every year. And we started that back in 2012. 
  
  (01:46): 
  
  And I'm also running all the partnerships with startups, which is what the open innovation pieces, which is all the way from biotech to synthetic biology all the way to technology itself like deep tech. So it's a long title, but with a really cool job. 
  
  James Kotecki (02:03): 
  
  And this is interesting because I think it is significant that L'Oreal is giving a keynote address at CES. L'Oreal has been very successful at CES for many years as you're saying, and some of it's been behind closed doors, but certainly it's had a public facing success at CES. 
  
  (02:20): 
  
  I still imagine there might be people who hear about this keynote address and scratch their heads and think, "What's a beauty company doing at CES?" 
  
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  But how do you kind contextualize and explain that to people who are really just coming to this idea of beauty tech for the first time? How do we get grounded in what this means? 
  
  Guive Balooch (02:36): 
  
  I think the best way to explain it to you is to tell you about the story about L'Oreal and our vision of beauty. We started as a company over 110 years ago by a chemist. It was a chemist that created the first hair color dye in the salon. 
  
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  And over time, the appetite for innovation and beauty and the consumer for beauty has just grown. No matter what the economic world is like, what society has shifted, beauty has always been something that has become more and more essential. 
  
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  And on top of that, we're the largest beauty company in the world today. We have over 35 brands. Brands that you may not know are L'Oreal, like Kiehl's, Maybelline, Garnier, Lancome, Kérastase. All of these are brands that are actually part of the L'Oreal portfolio. 
  
  (03:30): 
  
  And so, about 10 to 12 years ago, we had seen that more and more of this dynamic shift in society and the world around individuality, hyper-personalization, the need to understand my beauty habits and needs thanks to data so that I can have the best product over time. We're all going to be powered by technology. 
  
  (03:54): 
  
  And so, we took this bet around 2012 to come to the CES to try and be part of the tribe, but to try and understand what it would really mean for the future of our industry and our consumer rather than taking just a tech trend approach to it. And over the last 10 years, we've been coming every year with a new service that combines the beauty product with digital or physical technology, but to ultimately serve a need, to serve attention, that our consumers have that have been around for ages. 
  
  (04:35): 
  
  So I know it seems like it's something that's unique and different, but actually beauty and technology come together so well because, in the end, the needs of consumers around beauty are so deep and technology is a real way to solve them. 
  
  James Kotecki (04:53): 
  
  I did actually not know that Kiehl's was a L'Oreal product, but I was applying that moisturizer in Las Vegas for my on-camera interviews that I was doing there earlier this year in January. And I think it saved myself a lot of dry skin. So I appreciate that. The chemistry works. 
  
  (05:09): 
  
  But we're here to talk about a lot of these... But it's so interesting that you can kind of combine nowadays. Obviously there is this kind of baseline of chemistry, there's physical products that are out there that people are buying and applying, and we can talk about some of the digital ways that people choose to buy those and apply those. 
  
  (05:24): 
  
  But I think what people might stand out from your title, for example, is this idea of augmented beauty. It seems to kind of hint at digital augmented reality. So it's hard to even know exactly how to start articulating this question. But even since 2012, the world has dramatically changed in the way that people think about their online presence, the way that they represent themselves on social media, the way that they might use filters and editing to change their appearance, the way they see themselves, the way they want others to see them. 
  
  (05:55): 
  
  So how does L'Oreal, a company that has a storied history of making these physical products, start to think about operating in this increasingly digital world? 
  
  Guive Balooch (06:04): 
  
  Yeah, I think you hit on a number of points that are really important. I mean, when we say augmented beauty, for us it means taking beauty to the next level and this idea that, more and more, we're going to need to be more individualistic when it comes to our relationship with our consumers. We're going to need to let them shop and diagnose their beauty in different touchpoints, whether it's virtual or physical. We're going to need to connect those so that they can have the most seamless experience. 
  
  (06:33): 
  
  And ultimately, it all comes down to the big tensions that people have around their beauty. And I'll give you some examples. In 2014, we launched the first virtual makeup mirror, which allowed people using AR be able to virtually try makeup and be able to then physically buy that product. The tension is that you have thousands of choices when you go to a point of sale or a retail environment and you can't physically try all of them. 
  
  (07:03): 
  
  And so what we wanted to do was to allow people to have this kind of virtual way to choose the best product for them, and that ultimately allows people the freedom to be able to dare and try, but also to be able to buy the right product. And over time, what we've done is we've brought new services that combine physical, digital, but also the formula. 
  
  (07:28): 
  
  Sometimes we find that we needed products where, for example, 50% of people can't get the right shade of foundation today. And that's primarily because you don't have enough shelf space to have the same amount of products as you do skin tone. And so we created a machine called the Le Teint Particulier ["the individual complexion" under the Lancôme brand] that allowed people to get that perfect shade out of 22,000 options powered by data. 
  
  (07:52): 
  
  In the end, they get the physical product, but it's powered by tech. So we've done many things all the way from digital touch points to measurements, sciences to be able to measure your skin tone and your hair, to also making your life easier when it comes to using those products that people have had sometimes challenges in terms of mess, like hair color that now are products like color sonic salt. 
  
  (08:16): 
  
  So I think we start with what people need, which hasn't changed. And we try to backfill it with the right technology that allows people to get to that augmented level of performance that they want. 
  
  James Kotecki (08:29): 
  
  Making some big news, your company did, with disability tech with the ability to apply makeup for folks who might have challenges physically applying it to their face. 
  
  (08:41): 
  
  Can you speak a little bit more to that? 
  
  Guive Balooch (08:44): 
  
  Yeah, this is this real exciting project that we unveiled last year, which is what we call assistive beauty tech. And this idea that today, I'll start with the issue, which is that one in seven people in the world today have a disability. One in 10 people in the world today have a limited hand or arm mobility issue. Meaning that things like Parkinson's or stroke or rheumatoid arthritis or brain injury, paraplegia, all of these, I could list them forever, can create a challenge where people can actually experience beauty with their own hands and their own arms. 
  
  (09:29): 
  
  And that's a huge community. One in seven. So what we wanted to do was to find a way to allow people who have these mobility challenges to experience the products that we have and to experience any of the ranges of products. So we started with lipstick and we partnered with a startup called Verily, which is part of Alphabet, that had created a really cool spoon for people that had these kinds of mobility challenges where it will follow using AI, it will follow your mouth, and allow you to eat with your own hands. 
  
  (10:07): 
  
  And we just would try to find a way to create a version for makeup that we now call Capta, which really brings back my point about this essentiality of beauty and the fact that this community should have the accessibility to our products as much as any other community. 
  
  James Kotecki (10:25): 
  
  How do you think about the balance between this idea of hyper-individuality and people getting precisely what they need for themselves? With obviously... Beauty is a really... We can get super philosophical and I think I read some Victorian poetry about the nature of beauty in high school, and I'm still trying to figure out what essentially is this thing that we're talking about. 
  
  (10:46): 
  
  But when we talk about beauty, it is hyper individual, but it's also a societal thing. I want to appear beautiful, usually because I think someone else is looking at me, right? There's some element of this is, I may be using the wrong term, but this is the correct way to apply makeup versus not. 
  
  (11:02): 
  
  But so, how do you kind of live in that tension and how does technology help you navigate through that tension? 
  
  Guive Balooch (11:11): 
  
  Well, I think first we have to start with the right values of what people really want to achieve. For example, when you look at AR and the ability to use AR to find the right product, the tension there is that I want to virtually try something before I apply it, not to add a filter to my face or to do these kinds of things, that it's a different type of thing. For me, the point of beauty being something essential and about bringing confidence is about people being able to achieve their desired result no matter their skill level, no matter who they are, no matter where they live. 
  
  (11:44): 
  
  And if you think about it, this is the perfect problem to solve thanks to technology. I mean, I'll use some concrete examples. Today, I don't know what is the right skincare for me. That means that I need to have online diagnostics that allow me to understand what my skin type is, what kind of products would be tailored to it. 
  
  (12:08): 
  
  But even deeper, like our recent project with Verily, which was around running a huge clinical study to understand biomarkers and the proteins and microbiome in the skin. Today, thanks to tech, we're able to get measurements like that quickly. So if we can unlock those, we can help people have the ultimate hyper-personalization. 
  
  (12:27): 
  
  Or how do I achieve the perfect makeup result like my eyebrow where recently we launched Brow Magic allowing just thanks to a little applicator, we showed it at CES last year. You see with AR what shape of brow you want and you just move it and it shapes it for you. 
  
  (12:44): 
  
  And then skill level doesn't become a barrier to me achieving what I desire. Understanding my skin or hair doesn't any more become something of a mystery and making me audition in a way that is not as effective. And now tech will allow us to solve all of those, more and more that we will see society shift, more we will need to be individualistic with our relationship with people when it comes to their beauty needs. And technology allows us to do that. 
  
  (13:13): 
  
  So I think we have to start with that and then we find which ones are the ones that are the best scenarios to solve, thanks to tech. 
  
  James Kotecki (13:24): 
  
  And how have recent advancements in generative AI altered your roadmap or your thinking about what's possible, if at all? For example, I've seen a technology where you can upload a picture and it gives you dozens of different self-portrait options portraying you in different lighting, for example. 
  
  (13:42): 
  
  And one can easily imagine this kind of technology being applied to beauty as well, in some of the ways that you're already talking about, I suppose. Maybe pushing the boundaries further in terms of the suggestions that the AI is giving you or maybe giving you different combinations of things that you wouldn't have otherwise thought of. 
  
  (13:57): 
  
  Is that the kind of thing that you might think about with generative AI? 
  
  Guive Balooch (14:01): 
  
  Oh, absolutely. I mean, if we use just the idea of AI itself, like a few years ago, five, six years ago, we were already starting to embed artificial intelligence and how we look at finding the right molecules of the future for science and beauty science. We looked... It's inside a lot of our projects today that are beauty tech around like the magic brow I just told you about was built within a deep learning model. 
  
  (14:29): 
  
  But in the end, it's usually a combination of technology and I think that's the beauty of being able to do this for over a decade as we have a lot of assets now that come together that allow us to solve. But to answer your question about Gen AI, I mean there's no doubt that that's going to have a major influence on the beauty consumer experience of tomorrow. The question is in what places will it allow us to propel to do, and also the level of accuracy of how it does it is going to be very important. 
  
  (15:00): 
  
  So there are examples like you mentioned about lighting. There are potentials to be able to use it to be able to help us to develop the science of the future for beauty. There is the ability of new services that could be powered by that. There's how marketing and advertising can be modernized and hyper-personalized. 
  
  (15:21): 
  
  I think right now what we're trying to do is really play in that field where we were 10 years ago with digital, 10 or 15 years ago. We are now with Gen AI and trying to see what are those right places to embed it in. 
  
  James Kotecki (15:35): 
  
  And do all roads eventually lead to... You're in the digital world. You're looking at your options and maybe you're using a lot of technology to generate this stuff, but do all roads eventually lead to a physical product being applied to a physical human piece of skin? 
  
  (15:52): 
  
  Or are you thinking about things like the Metaverse where, if I'm a clothing brand, I'm thinking about how do I sell my clothing brand or my brand of handbags in the Metaverse to potentially people's avatars...? 
  
  (16:04): 
  
  Do you think about playing in those completely virtual spaces where the end product is effectively a digital one? 
  
  Guive Balooch (16:11): 
  
  We think about both. I think in the end of the day, the way we look at it is to see how our consumers are experiencing beauty. So if you look at, for example, our most recent launch of Microsoft Teams collaboration with Maybelline, New York on virtual makeup, that's not a physical product. It's a ability to apply digital makeup while you're having a meeting and don't have the time to physically apply. 
  
  (16:39): 
  
  And we live in a world today where people want to have that kind of interaction virtually and don't necessarily need a physical product at that moment in the touchpoint. I think that people, there is a joy and delight of people being able to physically use beauty products and that will continue, but there will be an additional layer where people will be experiencing beauty in the Metaverse and other potential touchpoint that we need to innovate on as well. 
  
  (17:06): 
  
  I think what matters is... So to answer your question, we're working on all of those different types of digital products, physical and what we call figital, which is a combination of the two. 
  
  James Kotecki (17:06): 
  
  Oh, I like that. 
  
  Guive Balooch (17:19): 
  
  I think all of that together are things... In the end, where our consumers want to shop, where want to experience, we have to innovate and hopefully delight them with new services. 
  
  James Kotecki (17:30): 
  
  Is that an original, the term figital? Is that a L'Oreal original term? So perfect to describe this nexus of the digital and the physical reality? 
  
  Guive Balooch (17:38): 
  
  I'm not sure we coined it. I wouldn't be so arrogant to say that, but I think it's something we talk about internally a lot. 
  
  James Kotecki (17:38): 
  
  I'll give you credit right here on my show. 
  
  Guive Balooch (17:45): 
  
  Okay, there you go. We can trademark it. 
  
  James Kotecki (17:47): 
  
  It's the first time I've heard it and it fits so perfectly with the themes that you're talking about. I want to get back to that Microsoft Teams example for a moment because all used Microsoft Teams or Zoom or something and somebody does the filter where they've got a silly pirate hat on and it stays on their head and then they move around and it doesn't... 
  
  (18:03): 
  
  Obviously if you're talking about something like makeup, it's obviously very personal and you're doing it in order, not as a gag, but to look professional. How good is it? What have people's experiences been with that? Is it truly a replacement for, I'm just running between meetings, I got to work out right after this, so I'm just going to do the digital makeup thing? 
  
  (18:19): 
  
  Can you go one level deeper on that product? 
  
  Guive Balooch (18:22): 
  
  Yeah, I think it starts with when we first launched Makeup Genius, which was the first virtual makeup mirror in 2014, so this has been almost 10 years in the making. We acquired a tech company called ModiFace that's a leader in AR for makeup. And over the last 10 years, the way we've approached digital makeup has been the same way we approach our physical products in terms of testing. And I'll tell you what it means. 
  
  (18:50): 
  
  Today when we test the physical product, we actually apply it on people from very light to very dark skin tones in different countries. And we test the accuracy of our products physically. We did the exact same, digitally. What we did was we had a whole bunch of different setups of cameras where people would, with different skin tones, would apply physically the makeup products and then we would compare them to what it actually looked like on the physical product. 
  
  (19:17): 
  
  And this is an enormous amount of science and work that goes into it. But we took the approach from day one that we don't want to build filters, we want to build a digital makeup experience. And so by doing that, we're now at a point where I can answer your question, which is when you are on Teams, there's a very high level of accuracy that the product that you are actually using digitally will be the same when you actually physically apply the product later or very close to the same. 
  
  (19:48): 
  
  And so this has been over 10 years of work and modeling that has gone into it. And it's one of the reasons why we're excited to bring this to hundreds of millions of people because we do believe very much in the accuracy of the technology. I myself am a scientist. I'm sitting inside the research organization for a reason. For that exact reason. To not compromise the quality. 
  
  James Kotecki (20:12): 
  
  It's so fascinating to see how this work that you've been doing for a decade is now paying off in things like Microsoft Teams. I'm not even sure the product Microsoft Teams was around. I guess Skype was around which Microsoft owns. I don't know if they owned it in 2012 back then, but it's just interesting to see these things come to fruition. 
  
  (20:30): 
  
  Obviously, you couldn't have known about the pandemic. Were you anticipating there's going to be an explosion of video calls? Were you even building it for that reason? And I guess what I'm getting at is what are some of the things that you're kind of playing around with now? What are some of the assumptions that you're making about the next 10 years, about how people are going to want to interact with each other and with your products? 
  
  (20:49): 
  
  Because it seems like you made some correct bets in the past, so we want to hear what your bets are for the future. 
  
  Guive Balooch (20:55): 
  
  Well, we've made some correct bets. I won't say all of them have been correct because I've been doing this for over a decade. So it would be definitely not true if I told you that we haven't done test and learn and one of them is learning. But I would say that when it comes to where we've done it right, I think we didn't anticipate at all what would happen in terms of a boom in video calls when we did Makeup Genius in 2014. 
  
  (21:22): 
  
  But we did understand that the world was becoming more digital and that people deserved the ability to virtually try something before they buy it. And I think that then was propelled as a result of the unfortunate pandemic. And when you start with that, I think that our technologies and our services have lasted a long time. And I'll use the example of our recent launch of Color Sonic. 
  
  (21:51): 
  
  We were the first inventors of the hair color dye in the salon over a hundred years ago. We were one of the first inventors of the hair color dye at home 50 years ago. For 50 years, the formulas have gotten better, but people have still had to mix it like they're a chemist at home. It's messy. They have to use gloves. It's not easy to do it. 
  
  (22:11): 
  
  And so around seven years ago, we thought, well, we have to make this process easier. And we invented in-house a technology that mixes the dye and the color and just applies like a brush, easy without any of that stress that people have. And then when the pandemic happened, it did give this kind of acceleration to people wanting to have these kinds of more easy services at home to do these challenging things. And so what I mean to say is it's not like we're trying to foresee what will happen in the world in the future. I think we're trying to solve some of these challenges that have been really hard to solve before. And when you do that, usually you find that they last a long time if you do it the right way. And so through all these years, we've learned to figure out now I think better and better what those right challenges are. 
  
  James Kotecki (23:10): 
  
  So what's your current cutting edge? What are the technologies or scientific or digital or otherwise that you're kind of pushing right up against or that you're eagerly anticipating someone else having a breakthrough in an adjacent industry so that you can apply it in yours? 
  
  Guive Balooch (23:26): 
  
  Oh, well, I think there are a number of them. I mean now more and more we find that the future of beauty lies at the intersection of many new kinds of areas of science. And one of them is like health. When you look at health and wellness today, we have an exclusive and really important partnership with Verily, which is the health division of Alphabet that allows us to build clinical studies of the future so we can understand the biology of people related to beauty and give them the best product, not just now, but over time. And to help us predict and to give people a management system around their beauty. We're looking more and more of that combination of AI and physical electronics allowing us magical experiences. Like maybe one day you'll be able to achieve all your beauty or makeup results with just having a pair of glasses that just does everything for you. 
  
  (24:25): 
  
  Like we saw in the movie Fifth Element 20 years ago, for those of you that remember that. I'm old enough to remember. And think- 
  
  James Kotecki (24:32): 
  
  Great film. 
  
  Guive Balooch (24:33): 
  
  ... Thank you, exactly. And I think this kind of hyper-personalization, which is what I was mentioning there, it's also just an example of this idea that we'll be able to have a two-way street kind of conversation with people around data, around what they need and to be able to give them the right product faster and more effectively. 
  
  (24:55): 
  
  So I think that comes in industries like AI and deep tech, and then even more like sustainability. We've launched our projects around water saving today and how our Water Saver project we unveiled at CSS a few years ago, which saves 60% of water in the salons without at all compromising the experience of feeling that pressure of modern that you enjoy. 
  
  (25:21): 
  
  So all of these areas, sustainability, tech, green tech, AI, in combination with electronics and health and wellness are going to build really exciting services that we believe will create great experiences for our consumers in the future. 
  
  James Kotecki (25:39): 
  
  Well, I don't want to ask you for any spoilers, but I do really appreciate this potential preview of interesting ideas and themes that might come up in the CES keynote that your CEO will be delivering at CES 2024. 
  
  And Guive, we just really appreciate your time today. Thank you so much for joining us today on CES Tech Talk. 
  
  Guive Balooch (25:57): 
  
  Thank you so much, James. It's a pleasure. And thank you so much for having me. 
  
  James Kotecki (26:01): 
  
  Well, that's our show for now, but there's always more tech to talk about. 
  
  (26:05): 
  
  Please subscribe to this podcast so you don't miss a moment, and you can get even more CES and prepare for Vegas at ces.tech. That's CES.tech. 
  
  (26:16): 
  
  Our show is produced by Nicole Vidovich and Mason Manuel