Estée Lauder Is Making Over Its Whole Business with AI

These days, fashion and beauty businesses are not only acting more like technology companies — spearheading in-house incubators, rolling integrations and experimental skunkworks labs — but restructuring the core of their very businesses around innovations like artificial intelligence.

Take The Estée Lauder Cos.

On Thursday, OpenAI, the tech firm known for igniting the current artificial-intelligence boom, said that it’s partnering with the beauty giant to unleash AI across its entire portfolio. That includes household names like Estée Lauder, Clinique, La Mer, Bobbie Brown and Aveda.

According to an OpenAI spokesperson, Estée Lauder will “deploy GPTs across all of its brands.” GPTs are at the very heart of generative AI works, featuring large language models capable of understanding and generating content.

The beauty company is no stranger to tech platforms, having included augmented reality try-on for its most recent launch on Amazon. But its work with ChatGPT, specifically the ChatGPT Enterprise group, is unlocking faster access to its own data vault and repercussions from that are set to ripple out across the business. The effort has led to the development of 240 custom GPTs that directly shape — and accelerate — how the company creates and markets new products.

The move represents a new chapter for the 78-year-old beauty firm, but the beginnings of this story goes back more than a year.

Estée Lauder was unavailable for comment, but according to an OpenAI blog post on Thursday, the momentum started when ChatGPT exploded on the scene, around the close of 2022.

“When OpenAI came out with ChatGPT, we asked employees to tell us how they would use it,” Raheel Khan, senior vice president of foresight and growth intelligence at The Estée Lauder Cos., was quoted as saying. “Over 1,000 people submitted ideas.”

This energy led to the formation of the ELC GPT Lab in April 2024. The team’s mission was to design, build, launch and scale GPTs across an array of scenarios, from how employees work to how they develop new products.

“Our work together is a perfect example of employees driving AI innovation from the ground up, and ELC leadership accelerating their progress and learning along the way,” James Dyett, head of platform sales at OpenAI, told WWD.

Months later, it’s clear that this work is no random experiment or hobby, but a technology revamp poised to reshape the very fundamentals of Estée Lauder’s business. On a broader level, it also aptly illustrates the changing tech landscape for legacy fashion and beauty businesses.

Just a handful of years ago, a vexing dilemma dogged decades-old brands and department stores. Although they had a rich goldmine of customer data, sometimes generations’ worth, they could hardly benefit from it. The AI of that time demanded clean nomenclature and data classification. Those records, however, were usually messy, collected in various ways and strewn across different divisions.

Today, the new breed of AI can make sense of the chaos and finally put the information to use.

That’s great news for companies like Estée Lauder, which sits on more than 75 years of data across clinical trials, product usage, surveys and more spanning more than 20 brands.

“Before, we spent hours manually cleaning and organizing data to uncover insights,” said Yuan Zhan, director of ELC’s Fragrance Foresight team, in the blog. “With the Fragrance GPT, we can ask complex questions in plain English, and it combs through the data instantly.”

The Fragrance Insights GPT crunches through consumer surveys and large datasets to identify the trends or preferences that are crucial for designing new products.

The Clinical Trials GPT can whip through dense loads of data and rip insights on skin care product efficacy.

One example cited by an OpenAI blog post on Thursday frames the latter GPT as being capable of “determining the immediate moisturization improvement percentage of a product like Estée Lauder’s Advanced Night Repair serum — from thousands of clinical trial reports with a simple query.”

Other GPTs help lighten the load for business teams. The Copywriting GPT acts as a customized writing assistant for campaigns across platforms, while a Vendor Snapshot Creator GPT finds and assembles essential vendor details, such as their profile and purchase histories.

Across R&D and business teams, ChatGPT improved response times by more than 90 percent and whittled hours-long tasks down to just minutes. Those new efficiencies speed up the time and effort it takes to launch new products. That gives a large company with a legion of brands the one thing that might have eluded it in the past — the ability to act as nimbly as a start-up to jump on trends and cultural moments.

Now, apparently even more of its employees are clamoring to use AI. With OpenAI and Estée Lauder’s evolving relationship, the AI genie has been uncorked.