The Beauty of AI: Estée Lauder's Sowmya Gottipati

**Sam Ransbotham** (0:01)
Skincare products are inherently physical, not virtual.
How can companies use AI to help make choosing skincare products possible online? Find out on today's episode.

**Sowmya Gottipati** (0:13)
I am Sowmya Gottipati from Estée Lauder, and you're listening to Me, Myself, and AI.

**Sam Ransbotham** (0:21)
Welcome to Me, Myself, and AI, a podcast on artificial intelligence and business. Each episode, we introduce you to someone innovating with AI.
I'm Sam Ransbotham, professor of analytics at Boston College. I'm also the AI and Business Strategy guest editor at MIT Sloan Management Review.

**Shervin Khodabandeh** (0:40)
And I'm Shervin Khodabandeh, senior partner with BCG, and I co-lead BCG's AI practice in North America. Together, MIT SMR and BCG have been researching and publishing on AI for six years, interviewing hundreds of practitioners and surveying thousands of companies on what it takes to build and to deploy and scale AI capabilities and really transform the way organizations operate.

**Sam Ransbotham** (1:05)
Shervin and I are excited today to be talking with Sowmya Gottipati, head of global supply chain technology for Estée Lauder.
Sowmya, thanks for taking the time to talk with us. Welcome.

**Sowmya Gottipati** (1:14)
Glad to be here. I'm really excited to be here talking about AI, one of my favorite topics.

**Shervin Khodabandeh** (1:20)
Yeah, great to have you.

**Sam Ransbotham** (1:22)
Let's start with your current role at Estée Lauder. What do you do now?

**Sowmya Gottipati** (1:26)
I've been with Estée for about two and a half years.
We are a prestige and luxury beauty brand company, and we have around 30 brands under our umbrella. Estée Lauder being the flagship brand, but we also have Clinique, Mac, Lumiere, several others. We are a global company with our products across all various regions from Asia to Northeast and Latin America, Europe, and everywhere. I'm responsible for global supply chain technology. So I am responsible for the technology that powers the entire supply chain globally. That includes inventory, supply, demand planning, manufacturing, distribution centers, fulfillment, transportation, end-to-end supply chain, all the technology capabilities that support that.

**Sam Ransbotham** (2:19)
All right. I didn't hear anything about artificial intelligence in that though. So how does artificial intelligence connect with that supply chain?

**Sowmya Gottipati** (2:28)
I took the supply chain role just about four months ago. So prior to that, I was responsible for brand technology for the Estée Lauder brand. That was really where I was directly involved in a lot of AI applications.
How we use AI at Estée Lauder, starting with the consumer experience, how we're enhancing our consumer experience with AI technology and providing real life applications, which I can talk to a little bit with the virtual try-on and so on and so forth. And then personalization is a very important area and the application of AI is very significant.
And then AI is also being used to create new products such as skincare and fragrance. This is where you can use data to inform ourselves on what kind of ingredients and what type of products that people like and so we can inform our product planning using AI and what I call agile enterprise. So there are a number of areas where AI is applied to run an efficient organization, such as supply chain and R&D. These are all various areas that we're using AI in.

**Shervin Khodabandeh** (3:35)
Sounds it's quite prevalent across the whole value chain. I did read up on something, I think a talk you had given on how AI is being used to help personalize the fragrance. Is that right?

**Sowmya Gottipati** (3:50)
That's right, yep.

**Shervin Khodabandeh** (3:52)
Can you comment on that a bit?

**Sowmya Gottipati** (3:53)
Absolutely. That's definitely one of my most exciting project that I worked on. It's an industry breakthrough. So I feel very proud about it.
It's a fragrance recommendation engine, but it takes advantage of neuroscience and AI and olfactory science. We are bringing all three sciences together to make that happen. Human brain has approximately 400 olfactory receptors.
And we are working with a company that can actually replicate those receptors in a lab environment. So if you take a particular fragrance, we can actually tell which olfactory receptors in your brain are activated by that fragrance.

**Shervin Khodabandeh** (4:39)
So are these like neuromorphic chips or are these silicon based software?

**Sowmya Gottipati** (4:44)
It's not a software. These are actually biosensor testing.

**Shervin Khodabandeh** (4:48)
That's pretty cool.

**Sowmya Gottipati** (4:50)
Yeah, it's really cool. So we would be able to tell receptor 67 and 92 and 86 are triggered by this particular fragrance.
And let's say that fragrance is predominantly lavender based. By the way, your brain can't really tell the difference between lavender and woody. So I might be able to bring woody fragrance to you and same receptors might get triggered because they are evoking the same emotion in your brain. So because same receptors are being triggered, we can tell, oh, by the way, just because you love lavender, you might like this other fragrance that may be woody, which smell totally different, but they have the same effect on your brain or they trigger same emotional reaction in your brain.