In December 1999, while waiting at the airport for an early morning flight from New York to Dallas for her final interview with Ulta Salon, Cosmetics & Fragrance Inc.'s then-chairman Sam Parker, Lyn Kirby penned a vision for beauty retailing that hadn't existed before.
Her ambition was to reposition Ulta from a discount store into a democratic beauty experience that housed mass, salon and prestige brands under one roof. That vision marked a departure for the industry, which has had a long tradition of separating products into retail classes.
When Kirby took over as president and chief executive officer, Ulta's assortment was heavy on mass beauty brands and had a smattering of salon products and gray-market prestige goods.
Recalling her early impression of the retailer, Kirby said, "There was no clear path to reposition the company from where it was into a multibillion-dollar business that would have access to salon and prestige brands."
Now, eight years later, her impromptu mission statement has served as the framework of the firm's evolution into a full-service purveyor of mass, salon and, increasingly, prestige beauty products, and its recent initial public offering. Ulta began trading on the Nasdaq on Oct. 25, with shares opening at $33 a share, up from its initial offering price of $18 a share. Shares closed at $30 Thursday.
"We have repositioned Ulta from a discount beauty store to a total experience with all the attributes of a category killer — size, real estate and marketing — with the service of a department store," Kirby said.
Wendy Liebmann, president of consulting firm WSL Strategic Retail, said, "Ulta is a concept that is absolutely ripe for consumers," adding that it caters to women's propensity to shop across all channels.
The Romeoville, Ill.-based retailer has built a chain of about 236 stores by planting its flag in suburban off-mall shopping centers. Kirby said the chain plans to end the year with 250 doors and sees the potential to have 1,000-plus stores over the next decade. She would not comment on Ulta's future rate of expansion, but noted, "We will open 50 stores this year, which is up from 31 last year."
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