TORONTO — As global retailers continue to grapple with the ever-changing face of technology, the push is on for brands big and small to embrace digital innovation with dogged determination — or fail.
“You’ve got to think mobile first. Just doing that is transformational,” Sephora Americas’ president and chief executive officer Calvin McDonald told attendees at Store 2016, the annual two-day conference hosted here by the Retail Council of Canada.
“Twenty years ago e-commerce emerged onto the market. Five years ago mobile came along and two years ago social commerce began on Facebook and Instagram,” McDonald said. “Today, technology is enabling us to think of ways to connect with consumers that we could never have imagined. But you have to do it all. Digital has to be fully integrated into your brand and you have to act on that with urgency.”
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Though Canadian retailers aren’t there yet, this change in attitude is clearly driving retail innovation in the U.S. Embracing digital has also forced U.S. retailers to rethink their relationships between their brands and their customers.
“In the U.S. it’s a fight for survival. That’s what’s driving this innovation,” McDonald said. “From a sales penetration standpoint we know that Canadian e-commerce is behind the U.S. by five years.”
Indeed, 19 percent of Canadian sales are done through foreign-owned retailers, while two-thirds of the country’s citizens order from the U.S. or international websites because the products they want are not available in Canada.
Despite these issues, McDonald sees real opportunity for Canadian retailers to embrace digital technology and deliver a more rewarding experiences to their clients. The fact is the future is here, it’s just not evenly distributed,” he said.
For Sephora, which boasts 1,700 stores in 30 countries, greeting that future has meant nurturing a culture of innovation within all its outposts. “First we created a disruptive spirit,” McDonald said. “If brands wouldn’t come to Sephora we’d create our own indie brands.”
As well, the retailer’s mission is to think through the lens of innovation to better serve consumers.
“We as a company are now completely focused on being mobile first,” he said.
It has also pushed the company to build consumer loyalty by ditching the emphasis on cash transactions and creating emotional connection to its customers. For example, as part of its new “Let’s Beauty Together” campaign Sephora offers how-to videos and runs hundreds of beauty classes in its stores, which clients can put on their own social settings or on the company’s beauty board.
As well, in February, Sephora launched a digital tool called the virtual artist which allows clients to click on and try 5,000 shades of lipstick. “We have had over 2 million visitors,” McDonald said. “In fact our business day was on the Super Bowl.”
Sephora also allows clients to play with the latest beauty products thanks to its new subscription program. For a monthly fee of $10, customers will receive a curated box of beauty samples to try, as well as a “play pass” which allows access to digital how-to tutorials. That program now has a wait list of 300,000 clients, McDonald said.