Companies are using algorithms across research, formulation and personalized recommendations, while grappling with data governance, intellectual property and more selective consumer spending.
Brazilian beauty and personal-care companies are introducing artificial intelligence and biotechnology at several stages of production, from selecting raw materials and testing formulas to analyzing skin and hair at points of sale. Those changes were discussed at Summit Inovação Abihpec 2026, organized in São Paulo by industry association Abihpec.
According to CNN Brasil, AI tools are being used in research and development to help assess raw materials, formulate products, run tests and identify patterns. The systems can speed up analysis and support data-based decisions. Skin- and hair-analysis devices can also inform individualized recommendations online and in stores.
Abihpec’s director of innovation and regulatory affairs, Ariadne Morais, said personalization is gaining ground as technology makes it possible to collect and analyze information about consumers’ individual characteristics and preferences. She said the tools can support more targeted recommendations in both e-commerce and physical stores.
The combination of AI and biotechnology is also expanding research into molecules and ingredients with potential uses in cosmetics. Controlled bioproduction can increase production scale and improve resource efficiency, according to discussions cited in the report.
Small and medium-sized businesses are also looking for ways to use AI to streamline internal processes. CNN Brasil reported that they can seek credit and funding from institutions such as Finep and Embrapii to help overcome initial investment costs.
The wider use of the technology raises questions about information security, data governance and intellectual property. Morais said companies need to consider authorship, the use of protected information and data security as AI becomes part of innovation work.
These changes are unfolding alongside Brazil’s tax reform and tighter household budgets. Abihpec says the reform could improve the sector’s competitiveness by easing investment, simplifying obligations and changing how taxes are applied along the production chain.
Consumers are also alternating between lower-cost essentials and higher-performance products, a pattern CNN Brasil calls an “hourglass effect.” Daniela Carbinato, a partner at Bain & Company, said shoppers are making more deliberate choices about which categories merit higher spending. Bain’s Consumer Pulse 2026 survey found that financial concerns were the main source of stress for 57% of Brazilians, followed by health and well-being at 46%. For major cosmetics and hygiene brands, the challenge is to sustain sales without relying on broad discounts that erode margins.