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What retailers can learn from Sephora’s winning retail strategy

Written by Stephanie Kidder

The retail industry is facing a climate of increasing uncertainty. However, despite the adverse conditions, the beauty industry is still thriving. And Sephora, the LVMH-owned beauty retailer is one of the winners of the industry thanks to its customer-centric and digitally-focused retail strategy using omnichannel and engaging clients in new ways. Here are 3 retail strategies that show how Sephora gets closer to what its clients want and need.

1. Mastering Omnichannel through Beauty Hubs

Last March, Sephora unveiled its “Beauty Hub” in two shops in France offering a fun retail experience to its clients. Each Beauty Hub is a virtual lookbook with thousands of options provided via iPad stations or interactive mirrors, where products can be virtually tried using augmented reality. Beauty recommendations like skincare diagnostics and tutorials are also available, with or without the advice of an in-store makeup expert. Items tested on these new digital tools can be purchased either in-store or online.

Sephora also created the Beauty Board, a social media platform, where followers can like a look, tag the products used and share them with the Sephora beauty community. And finally, to complete this retail experience, Sephora also offers Beauty Classes with makeup lessons and workshops led by beauty professionals at the Beauty Hub.

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The Beauty Hubs are a new innovative tool that gives the opportunity to buy products in-store or online, providing several purchasing options to clients, but also a fun and engaging experience. The Beauty Hubs show that Sephora has acted on the fact that consumers want to do more than just buy products in stores in an expert way. Retailers have to rethink the purpose of the store and propose unique and helpful experiences to their customers.

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2. Creating of a community of clients and a digitally-focused retail strategy

In order to help their customers find the right products and to create a solid community of advocates, Sephora launched a loyalty members-only mobile and online social platform called the “Beauty Insider Community”. On the platform, customers can create a profile to get answers to beauty-related questions through the “Groups” and “Conversation” features, and to find new makeup inspirations and tutorials with the “Gallery” feature. The retailer also launched the “Live Community Chat” to enable clients to chat with other Sephora customers on any given product page about their experience with that item before committing to the purchase.

With this new platform, Sephora has positioned itself as a pioneer in the beauty sector. People will go directly to the platform to find inspiration and recommendations. Thanks to this new community initiative, Sephora will build trust and have an even more solid customer base. The platform can also provide priceless data. Sephora can monitor which items and topics are trending and create strategies accordingly.

3. Stay close to clients with Sephora Studio

In the US, Sephora stores are mainly established in malls. In order to fight the decrease of foot traffic in malls and be closer to customers, Sephora recently opened a new concept store in Boston known as Sephora Studio. The studios will be about 2,000 sq ft, less than half the size of a typical Sephora store (5,500 sq ft), and feature digital components and a more curated retail experience for shoppers. Digital welcome screens with menus greet visitors, and all employees are equipped with an iPhone 7 for mobile point-of-sale purchases instead of cash registers. The store is equipped with digital screens, which gives a before-and-after preview using the AR “virtual artist”. Order-in-store and same-day pickup options for online purchases are also available. And one-on-one services are offered including 45-minute makeovers, 15-minute mini facials and the first ever 75-minute “Custom Makeover Plus”.

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Sephora is aiming to settle in classic neighborhood shopping streets with a dynamic retail mix in order to attract new customers who might not go to mall, and propose personalized experiences that will be meaningful to win customer loyalty. This store concept is mainly based on experience as a differentiation point.

With its innovative strategies designed to make its customer’s shopping life easier, Sephora is embracing new retail trends for the better. Retailers need to adopt customer-centric strategies and integrate digital into their stores to provide seamless shopping experience.

About the author

Stephanie Kidder