On September 22nd, the L’Oréal “Innovator Z Summit” and the 20th Anniversary of Youth Fun were grandly held at Shanghai Jiao Tong University. The event was organized by L’Oréal Group and Shanghai Jiao Tong University. It was also the first time for L’Oréal CEO Nicolas Hieronimus to visit a Chinese campus. During the summit, Nicolas Hieronimus shared insights on topics such as technological innovation, sustainable development, and talent empowerment. Additionally, Nicolas Hieronimus announced the investment of L’Oréal Group’s first Chinese cosmetic ingredients innovation biotech company, SHINEHIGH INNOVATION, highlighting the importance of the Chinese market for L’Oréal’s innovation.
Innovation: The foundation of L’Oréal
At its inception, founder Eugène Schueller laid the brand spirit of L’Oréal: research and innovation in the service of beauty. This brand spirit has endured for a century and continues to this day.
Innovation was also one of the key themes in the speech at the summit by Nicolas Hieronimus, CEO of L’Oréal.
Nicolas Hieronimus stated that innovation was one of the primary reasons for his engagement with L’Oréal. At L’Oréal, innovation is not only a belief but also the driving force behind the company’s actions. Only when innovation serves noble goals can it benefit human society. He further remarked that China has long recognized the significance of innovation in advancing human progress. The innovation represented by China’s Four Great Inventions surpasses their technological influence, symbolizing human creativity, the spirit of exploration, and the desire for progress.
In his speech, Nicolas Hieronimus elaborated on L’Oréal’s innovation philosophy from three aspects: research and innovation, open innovation, and innovation for the earth.
In terms of research and innovation, L’Oréal invests over 1 billion euros annually in research and development, aiming to shape the future of beauty and always stay at the forefront of innovation. In 2022, L’Oréal’s 4,000 researchers worldwide filed over 500 patents, making L’Oréal one of the most innovative companies in the world.
Moreover, China is one of the most mature and cutting-edge beauty markets globally. As early as 2005, L’Oréal established its research and innovation center in China, bringing together more than 400 researchers and scientists. China serves as one of the three global hubs for L’Oréal’s beauty technology. L’Oréal is drawing inspiration from China’s wisdom to enlighten the world. Particularly in the North Asia region, L’Oréal sees the synergistic effect among the beauty markets of China, Japan, and South Korea. This is why many of L’Oréal’s innovative achievements are first launched in China and then expanded to neighboring markets.
Regarding open innovation, Nicolas Hieronimus stated that innovation is not conducted in isolation but rather aims to transform L’Oréal into a beacon, guiding the changemakers who collaborate with L’Oréal to shape the future of beauty. To achieve this goal, L’Oréal initiated the BOLD (Business Opportunities for L’Oréal Development) strategic venture capital fund several years ago. Through this fund, L’Oréal invests in exceptional partners and startup companies to seize future opportunities in the beauty industry. Since its establishment, L’Oréal has invested in approximately 20 startups across eight countries. Notably, L’Oréal has also established an investment company specifically in China called “MeiCiFang” and recently announced an investment in a highly promising Chinese enterprise, SHINEHIGH INNOVATION. Additionally, to foster collaboration with Chinese innovators, L’Oréal launched the “BIG BANG Beauty Tech Challenge Camp,” China’s first-ever startup competition dedicated to beauty technology. This year, L’Oréal plans to expand the coverage of this program to encompass the entire North Asia region.
In terms of innovation for Earth, L’Oréal deeply embraces the concept of sustainable development. L’Oréal embarked on its sustainable development journey many years ago. Despite the long road ahead, L’Oréal has made significant progress in its sustainability efforts. For example, since 2005, L’Oréal has reduced its carbon dioxide emissions by 91% while increasing its product production by 45%. This remarkable achievement has been widely recognized by external experts, making L’Oréal the only company to receive the AAA rating from the Carbon Disclosure Project (CDP) for seven consecutive years. L’Oréal China has played a critical role in this journey. As early as 2019, L’Oréal China became the first market within the entire group to achieve carbon neutrality in its operational sites.
Since its establishment, innovation and openness have always been L’Oréal’s ongoing pursuits, aiming to become a beacon leading the way to the beauty of the future.
L’Oréal’s first investment in a Chinese cosmetic ingredients company
At this summit, Nicolas Hieronimus announced another significant investment in China. L’Oréal Group has made a minority equity investment in SHINEHIGH INNOVATION, a Chinese innovative biotech company, to establish a long-term partnership for the co-development of novel and sustainable beauty solutions.
According to L’Oréal, this marks their first open innovation investment in China through their subsidiary, Shanghai Meicifang Investment Co., Ltd, and is supported by the L’Oréal Group’s strategic venture capital fund, BOLD. It is also the first project to receive investment from the BIG BANG Beauty Tech Innovation Challenge an incubation program launched by L’Oréal in China four years ago.
SHINEHIGH INNOVATION is a Chinese startup founded in 2017 by renowned scientist Prof. Jiaheng ZHANG, focusing on advanced supramolecular chemistry. With their pioneering smart self-assembling technology, they can achieve ingredient combinations that were previously impossible, leading to more effective and sustainable end-products. This partnership will empower L’Oréal to fully harness the capabilities of raw materials, addressing challenges such as compatibility, stability, and delivery. Together, they will develop innovative formulations for skincare, haircare, and scalp products, offering a broader range of benefits.
Barbara LAVERNOS, Deputy CEO of L’Oréal Groupe in charge of Research, Innovation and Technology, said: “The fast paced and unique ecosystem of startups in China is an incredibly important enabler of our future strategy of innovation at L’Oréal. This is why we are extremely excited to pursue this new investment and partnership with one of these highly innovative Chinese Biotech Startups: SHINEHIGH. This partnership which will enable us, thanks to their world-leading application of supramolecular technology in the beauty industry, to bring breakthrough new performances to the beauty market. We are delighted to enter this exclusive beauty partnership with the pioneering team of SHINEHIGH.”
Investing in SHINEHIGH INNOVATION is a significant move by L’Oréal to foster innovation in China. As mentioned by Nicolas Hieronimus, China is one of L’Oréal’s three global hubs for beauty technology. L’Oréal is drawing inspiration from China’s wisdom to enlighten the world.
L’Oréal’s previous investments in China primarily focused on establishing new factories in the supply chain. One example is the Suzhou Mei Ci Factory, which took four years to construct and has become L’Oréal’s largest production facility in the Asia-Pacific region. In 2013, L’Oréal’s Yichang Tian Mei Factory was completed and became the largest makeup production base in the Asia-Pacific region, primarily manufacturing lipsticks and other types of cosmetics. Last year, L’Oréal also invested in the Chinese high-end fragrance brand Documents, marking their first brand investment in a Chinese company.
This investment in SHINEHIGH INNOVATION marks L’Oréal’s first investment in a Chinese raw material company. It also signifies L’Oréal’s comprehensive investment in the Chinese market across the entire industry value chain, from upstream ingredients to midstream brands and factories. As L’Oréal stated: “proving the successful achievement in China’s open innovation ecosystem.”
At the Innovator Z Summit, Nicolas Hieronimus also mentioned L’Oréal’s next development goal: to become a beauty tech company.
As early as 2018, the L’Oréal Group put forward a vision to transition from a beauty company to a beauty tech company and announced its ambition to become a “leading company in the beauty tech field,” highlighting the crucial role of innovation in its strategy.
Nicolas Hieronimus expressed his vision for the future, stating that beauty can exist both in physical and digital realms. Over the past decade, L’Oréal has transformed into a digital-first company, with over a quarter of its sales coming from e-commerce. In China, this proportion rises to an impressive 66%. To achieve its ambition of becoming an undisputed leader in the beauty tech field, L’Oréal employs over 6,000 technology and IT experts worldwide.
Nicolas Hieronimus provided several examples of L’Oréal’s beauty tech innovations. One such example is the lipstick printer, a compact and portable device introduced by YSL. With a simple button press, consumers can obtain personalized lipstick and makeup formulations. Beauty tech is also revolutionizing how people discover, try, and obtain product information both online and offline. Earlier this year, at the VivaTech event in Paris, L’Oréal unveiled the K-Scan by Kérastase Paris. This AI-powered smart camera can scan, detect, and track users’ hair and scalp conditions. The technology was developed through a collaboration between L’Oréal’s research and development team in China and a Chinese optical equipment company.
At the same time, L’Oréal is keeping up with the latest technology trends. L’Oréal has begun exploring the endless possibilities of technologies like generative AI, Web 3, and the metaverse. Generative AI is expected to revolutionize content creation. L’Oréal is also laying the foundation for new beauty spaces and communities through Web 3 and the metaverse. Many of L’Oréal’s brands, such as Maybelline New York, L’Oréal PRO, and Shu Uemura, are creating immersive and gamified beauty experiences in virtual spaces.
Regarding innovation and technology, Nicolas Hieronimus emphasized the path of youth innovation, which is centered around people. This is one of the reasons why Nicolas Hieronimus has ventured into Chinese campuses. He believes that youth will be the driving force behind innovation and technological development, both for society and for L’Oréal.
L’Oréal has always believed in the unlimited potential of young people. As early as 2021, L’Oréal launched the L’Oréal for Youth global youth empowerment program, offering 25,000 job opportunities each year for individuals under the age of 30. In China, L’Oréal has also implemented various localized initiatives, including the upcoming celebration of the 20th anniversary of the “Interesting Youth” university public welfare program. As one of the top public welfare projects on campuses nationwide, “Interesting Youth” provides financial support to students across the country.
L’Oréal China has been working alongside the youth, dedicated to philanthropy and transformation for 20 years. They have visited 33 universities across the country, providing funding for over 5,000 impoverished students. The cumulative donations exceed 40 million RMB, benefiting approximately 4.3 million students. Behind these numbers lies the dedication and benevolent spirit of L’Oréal China working hand in hand with the youth. At the conference, L’Oréal China also held the Youth Fun 20th Anniversary Awards Ceremony, conveying the positive energy of the youth who march forward with the times. This year, the contributions of “Interesting Youth” in the field of public welfare remain remarkable. During a one-month event, students from 18 universities nationwide raised 2.48 million RMB through online and offline charity sales activities. At the awards ceremony, L’Oréal China donated this sum to the China Youth Development Foundation, which will distribute it to participating universities to support students in need, foster innovation and entrepreneurship, and facilitate overseas study programs.
In addition, L’Oréal has consistently held the Brandstorm innovation challenge. This is a global student competition focused on innovation, which attracted over 80,000 students this year. Nicolas Hieronimus stated that the Chinese youth innovation ecosystem is so vibrant that it deserves a dedicated innovation empowerment program. In 2022, L’Oréal also launched the “Youth Bang” L’Oréal Youth Entrepreneurship Camp during the China International Import Expo, which is the first program aimed at empowering entrepreneurs under the age of 30 in China to co-create the future of beauty.
Overall, at this Innovators’ Conference, L’Oréal showcased its longstanding brand spirit: research and innovation in the service of beauty. Whether it’s in terms of talent or technology, L’Oréal has consistently practiced its philosophy of continuous innovation, which is the foundation for its rise to become the world’s leading beauty giant over a century.