“Since we opened our first store just over 50 years ago, Sephora has been a disruptor in the industry with an eye on growing the prestige beauty market and on serving the consumer better than anybody else,” said Martin Brok, president and chief executive officer of the world’s largest omnichannel prestige beauty seller.
Brok said the partnership with Zalando, Europe’s leading fashion and lifestyle e-commerce site, is in line with that.
“As we think about the rules in retail, the beauty space itself, it’s really been redefined,” he said. “COVID-19 has only further accelerated the shifts that we’ve seen taking place. Today’s consumer no longer [just] shop stores, shop sephora.com. The fact of the matter is they also shop marketplaces — like Zalando.”
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On a macro level, the retail landscape has been shifting swiftly, too, with a platform such as Amazon widening its Premium beauty offer and Douglas bulking up its digital presence by opening the retailer’s marketplace to more partners during the pandemic.
According to Sephora and Zalando executives, however, their focus is on the consumer rather than the competition.
“Given we’ve been consumer-obsessed from the get-go, what we want to make sure is that we meet our consumer wherever they are,” Brok said.
Sephora wants to own each part of the consumer journey.
“It recognizes the importance of teaming up with the best-in-class partners, and that’s what Zalando is for us, and what this partnership is all about,” he said. “What was really appealing to us is that Zalando truly understands brands, the power of curation and premium.”
The goal is to jointly create a matchless customer experience for Zalando’s 42 million active customers.
“It’s this deep customer experience and e-commerce expertise combined with Sephora’s curated assortment of several thousand products from more than 300 prestige — as well as exclusive — brands, our beauty expertise and marketing power in prestige beauty that creates what I believe is an unparalleled partnership,” Brok said.
It’s possible to leverage having fashion, prestige beauty and accessories under one roof as Sephora and Zalando think about consumers’ lifestyle, shopping experience and expectations, he added.
“Hyper-personalization” is going to be important.
“In today’s world, the consumer thinks about brands that they engage with through the lens of ‘know me, serve me,’” Brok said. “We need to know the consumer better than she knows herself.”
Brok said for brands, the deal presents a unique opportunity to help them elevate and recruit new customers.
“It’s certainly a fundamental and critical step in our European growth strategy,” he said. “It starts to give you a bit of a peek under the tent in terms of what our vision is for the future of beauty and retail itself.”
Sephora is also already moving aggressively in North America to reach more customers, with its first Sephora in Kohl’s stores due to open in August.
Brok believes — clichés aside — that partnerships are at their best when one plus one equals three.
“This absolutely is the case,” he said, referring to the Zalando tie-in. “It’s complementary in the way we look at the world, it leverages the strengths of both parties and brings those to bear.”
David Schneider, Zalando co-CEO, said the partnership is key for bringing consumers the best experiences. When the platform started out in beauty in 2018, he asked what the best-in-class experience is. So his colleague took him to a Sephora store in New York to watch and learn. Schneider realized that it was the interactive experience that needed to be translated into the digital world.
“I remember also I asked back then: ‘So why don’t we just partner up with Sephora?’” he said with a laugh. “That’s the original idea.
“Sephora is very strong in product, content, storytelling and consultation,” Schneider said. “What we add is our digital skills around tech data, like online experience and engagement with customers.”
The consumer reach could be immense. At Zalando, three out of five people who buy beauty also shop fashion, and fashion-engaged customers are often highly engaged in beauty, according to Joanna Rogers, vice president beauty at Zalando.
“It’s a huge opportunity and tapping into a fairly open field for trading — a true digital experience for beauty online,” Schneider said.
Consumers will see the Sephora-Zalando partnership spring to life starting in the fourth quarter in Germany, when Sephora’s entire offer will be available on Zalando. Their online platform will then in 2022 be rolled out to other countries.
“Ultimately, we want to have this partnership across Europe with all the assortment and start building this together from now on,” Schneider said.
Today, Zalando sells more than 13,000 products and 350-plus brands in beauty. Those not in the prestige category will continue to be sold on the platform, just not in the Sephora-related space.
“We want to be a place where customers can start truly looking for beauty,” Rogers said.
Assortment is crucial, as is making the experience personal, like by addressing the issue of trying before buying. A focus will be put on inspiring consumers across Zalando’s platform.
Looking ahead, the prestige beauty products sold on Zalando could be tweaked according to geography, in keeping with the platform and Sephora’s ethos of inclusivity.
“It’s not only about growing ourselves as Sephora or as Zalando,” said Gonzague Arnoulx de Pirey, global senior vice president new ventures at Sephora, about the partnership. “It is really putting the prestige beauty market at the next level.”
Both want to play and be present in the total beauty ecosystem, so they consider elements like Sephora’s online and offline presence in Germany, where it has five physical stores and 16 corners in Karstadt Kaufhof, as being complimentary to the upcoming prestige beauty platform.
Zalando’s ambition is to be a platform for brands to connect to consumers and vice versa.
“How do we make it easier for the customers? How do we remove barriers?” Schneider said. “It’s not competing for the customers, rather jointly serving them in the best way.”
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