Dive Brief:
- The Estée Lauder Companies and Microsoft will create an AI innovation lab as part of an ongoing partnership between the two companies, according to a Friday announcement.
- Estée Lauder plans to infuse generative AI across more than 20 brands, which include Clinique, Mac and Too Faced. The cosmetics company will leverage Azure OpenAI Service, and collaborate with Microsoft to develop the solutions.
- Currently, the two companies are working on a generative AI chatbot for employees to quickly gather information related to projects, regions and advertising campaigns. Estée Lauder is also exploring generative AI applications to support its research and development process.
Dive Insight:
Estée Lauder is looking to strengthen its AI capabilities after sifting through generative AI use cases submitted by employees last year and becoming an early adopter of ChatGPT Enterprise.
“Our partnership with Microsoft has already sparked incredible innovations,” CIO Michael Smith said in a LinkedIn post Friday. “I’m eager to continue this collaboration through our new AI innovation lab and bring AI to the forefront of beauty.”
Estée Lauder previously tapped Azure AI as the platform for its Voice-enabled Makeup Assistant app, which launched in 2023. The expanded partnership brings the cosmetics company dedicated resources from Microsoft to fuel its latest AI projects, such as the chatbot.
“The generative AI chatbot developed with Microsoft helps us quickly find products that address specific concerns relevant to specific regions and emerging markets,” Smith told CIO Dive in an email Friday. “We will continue to explore other ways we can harness ELC’s wealth of data across products, ingredients and more in tandem with the power of generative AI.”
Cosmetics companies are leaning into AI with high hopes for greater efficiency, improved experiences and expanded data analytics. L’Oréal uses its data platform, which houses 10 petabytes of data, to power AI models.
Like others in the industry, L’Oréal sees AI playing a key role in driving growth in the year ahead. Technology providers see the potential, too.
Microsoft’s Q3 2024 revenue increased 17% year-over-year to $61.9 billion, the most valuable public company reported Thursday. The provider’s cloud revenue segment, bolstered by the rise in AI compute needs, grew 23% year-over-year to $35.1 billion.
“Azure again took share, as customers use our platforms and tools to build their own AI solutions,” CEO Satya Nadella said Thursday during the earnings call. “More than 65% of the Fortune 500 now use Azure OpenAI Service.”
The tech giant’s sizable share of enterprise clientele extends to other AI services, with nearly 60% of the Fortune 500 using Copilot for Microsoft 365, according to Nadella.
“We’re also seeing increased usage intensity from early adopters, including a nearly 50% increase in the number of Copilot-assisted interactions per user in Teams, bridging group activity with business process workflows and enterprise knowledge,” Nadella said.
