Sephora, Retail Leader in Personalized Experience
Sephora, one of the basic pillars of LMVH as far as retail is concerned, has been an example of how to adapt to changing times for retailing.
These changes usually involve a drop in traditional store sales, an increase in e-commerce and a need to interact with the customer using a multi-channel strategy. Founded in 1970 by Dominique Mandonnaud, the French luxury multinational chaired by Bernard Arnault bougth Sephora in 1997. Sephora currently has more than 2,300 stores and operates in 33 countries. It is defined as a single open sales environment with a growing variety of products from carefully selected brands, including collections such as Indie Darlings, Emerging Favorites, Trusted Classics and the Sephora Collection itself.
Several instruments that make him close to the client and that he values his experience very positively have made him worthy of the award that gives Sephora as the first global retailer in terms of personalized experience, according to the first annual Retail Personalization Index of Sailthru marketing platform (www.sailthru.com).
The Index was based on a survey of more than 13,000 US and UK customers and ranked the top-100 retail brands on how they personalize customer experience in four areas: website, email, mobile phone and other apps. JustFab and Walmart ranked second and third in the index, respectively.
Closer to the customer
Apart from the Sephora stores and its website www.sephora.com, the company has instruments such as Sephora mobile application with which it uses the buyer’s data to integrate the physical and digital experience. Through market research, Sephora has discovered that its customers often use their smartphones when they are buying in their traditional stores. The company analyzed that these buyers often looked for external recommendations, product reviews or better prices on the products they considered buying at the store.
Once this information was collected, Sephora developed the Sephora to Go, a mobile application, which is based on providing buyers with a mobile experience that suits their needs. The application is designed to emulate the knowledge of a personal shopping assistant or a Sephora sales associate, as it provides product recommendations, reviews, pricing information and a simple format that helps a customer buy products easily.
Beauty Insider: in 2007, Sephora launched a customer loyalty program to feed its addiction to beauty with promotions and unique experiences, using data from this program to send personalized communications and recommendations. The company also leverages the data of a customer’s online shopping activity by using reminders, which send notifications when the buyer is near an item left in their virtual shopping cart.
Change of strategy in Russia
After several attempts to open stores in Moscow with its own brand, at the end Sephora decided to acquire in 2008 one of the leading Russian perfume distribution groups: Ille de Beaute. At the present, it is in the fourth position in the ranking Russian after Magnit Cosmetics, Rive Gauche and L’Etoile.
Its managers observe a stagnation of sales that could make Sephora shortly present stores with its own brand. Obviously, it should differentiate itself from those of Ille de Beaute, although there are several experts, such as those consulted by Russian business newspaper “Kommersant” who consider both possibilities: a renaming of certain Ille de Beaute stores and movements in the Russian real estate premium stores market that may suggest that Sephora will be established shortly in new stores. The prospects for the luxury cosmetics industry in Russia are quite optimistic, with estimated growths close to 10% in 2018. LMVH through Sephora wants to take advantage of it.
Disclosure:The Luxonomist is not responsible for the views expressed in the article. The text has been written freely expressing their own ideas, without receiving any compensation. The author has no business relationship with any of the companies whose shares are listed in this article.