By any measure, Ulta Beauty is successful. But the true impact the beauty retailer will make in the market hasn’t been realized.
This story first appeared in the August 5, 2015 issue of WWD. Subscribe Today.
There are still consumers who haven’t shopped at — let alone heard of — the 25-yearold retailer, which offers a mix of salon services, prestige and mass beauty. There’s even potential from existing shoppers — only 7 percent of Ulta Beauty’s 15.5 million loyalty members take advantage of the salon services.
That’s where Dave Kimbell, chief merchandising and marketing officer, comes in.
“There are even people in Chicago who still haven’t heard of us,” said Kimbell from Ulta Beauty’s headquarters in Bolingbrook, Ill., a suburb of the Windy City. “We think there are a lot of opportunities to tell our story in a bigger way and attract more guests,” added Kimbell, who Ulta Beauty’s chief executive officer Mary Dillon recruited away from her former employer, U.S. Cellular. He joined Ulta Beauty in February 2014 as chief marketing officer and upon the retirement in May of Ulta veteran Janet Taake, he assumed the title of chief merchandising officer as well.
He’s digging into his tool bag, which includes a test of same-day delivery in conjunction with Google Express. He is also testing in-store orders for home delivery and clienteling with in-store iPads, providing staff with customer information such as recent purchases. The company is also doing live online chats with founders of Ulta cornerstone beauty brands, and has launched technologies to be able to buy items from bloggers’ Ulta video hauls.
Later this year, Ulta will unwrap its first national TV and radio campaign following successful tests in select markets. These strategies are all tied to Ulta Beauty’s customer relationship management philosophy that’s helped shape how the retailer curates its message.
“No one brings the collection of products, services and experiences that we do,” he said.
The assortment of prestige lines has mushroomed in the past five years and now includes Bare Minerals, Benefit, Clinique and Lancôme, which have dedicated boutiques in many stores. There’s also expanded real estate dedicated to Dermalogica and the Urban Decay offer.
But Ulta Beauty hasn’t strayed from its original vision to offer mass in addition to prestige. The company was founded by former food and drug combination stores executives.
The salon is also a competitive edge, one Kimbell believes has much room for growth. Ulta Beauty’s salons offer a bevy of services including cuts, color, gel manicures, brow shaping in conjunction with Benefit Cosmetics and facial treatments in a partnership with Dermalogica.
“The quality of our salon has certainly improved. We’ve really invested heavily in our stylists and created an artistic team that has elevated the training and development to keep up with current trends.”
The company hopes its newly rebooted rewards program will nourish the synergy between the front end and the back end of the store where the salons are housed.
Launched last year, UltaMate Rewards nets shoppers one point per every dollar spent that is good for any product (one of its older versions only allowed rewards for certain products).
Additionally, those who spend more than $400 per calendar year earn platinum status netting them more points per purchase (1.25), special gifts and early access to new items. The rich data gleaned helps Ulta Beauty zero in on preferences. For example, a launch of a brand a customer likes could prompt an e-mail to alert her.
“The rewards program is so central to our offer right now,” explained Kimbell who helped overhaul it upon his arrival. “We have 15.5 million members and that’s growing quickly,” he added, noting those shoppers represent 80 percent of sales. “It is a great program — it works on so many levels.”
Ulta Beauty is full throttle in its efforts to offer seamless purchasing for shoppers. Three years ago, the company invested big in improving the navigation of its Web site as an effort to remove any friction to purchase. A popular feature on Ulta Beauty site is the chance to chat online live with the founders of cornerstone Ulta brands such as Mally Roncal of Mally Beauty or Wende Zomnir, the creator of Urban Decay.