What’s new:
So much to talk about with Ulta Beauty. If you listened to their recent earnings call, you know they continue to beat projections, delivering strong top-and-bottom-line results and growth across all major categories and in both in-store and eCommerce channels. And they’re seeing healthy, double-digit growth across both the prestige and mass segments. Resilient beauty category at play? Yes. Smart, strategic marketer? Absolutely.
A few things stood out to us:
For the first time, in-store traffic exceeded pre-pandemic levels, and buy-online-and-pick-up-in-store sales were up 18% in Q3 -- 23% of total eCommerce sales. The Ulta Beauty team knows the in-store experience is just as important to their customers as the online environment and continues to innovate and invest there. They are disrupting the industry with a new “full-experience store” format piloted in 18 stores last year; it’s working so well that many more doors will be added this year. It replaces the existing price-based layout and separation between mass and prestige and creates “mass migration” opportunities for shoppers to trade up. And there is particular focus on expanded experiential moments through a center service bar and other areas designed for sampling and shopper education events.
Sales of new products and product innovations normally average 20% to 30% of Ulta Beauty sales; this trend continues and the company is even more keenly committed to “newness.” Of note: The front of the store will now feature “the Newness Zone,” dedicated to storytelling around brand and product launches. Skincare also moves upfront with a spotlighted, “Skincare We Love” section of “must-know, must-try worthy” brands. And Ulta Beauty remains committed to supporting “newness” in the Conscious Beauty category and through the Muse accelerator program.
Through its stores, digital and a Target partnership, Ulta Beauty has hit new record highs this last reporting period with a loyalty program that soared to 39 million members. Not only one of the largest loyalty programs in the beauty category, it boasts members who are emotionally connected to the brand and highly engaged, with a higher frequency of shopping visits and spend more money. Also in the last year, Ulta Beauty powered up a robust retail media network to best leverage the granular data and insights available through this program.
What to think about:
-
Ulta Beauty is keenly focused on “new” and has one of the strongest sampling programs in the industry; how can this most effectively play out in your new product launch plan strategy?
-
In what ways should you re-think your in-store strategy at Ulta Beauty to best leverage the new store format to grow your brand?
-
Given Ulta Beauty’s powerful loyalty program and the opportunities it offers, how can you best connect with your consumer at critical points along their buying journey?
-
With Influencer and Social Media marketing now a must-have, what are you doing to strengthen these programs with an eye toward supporting Ulta?
Want to know more?
Contact Jennifer Cutelli, Director, MPG Beauty Specialty, at jennifer.cutelli@mpgllc.com.