By Kate MacArthur, writer for Blue Sky at The Chicago Tribune
This article originally appeared in The Chicago Tribune’s Blue Sky Originals, which can be found here.
As beauty-product sales increasingly move online, Ulta Beauty has launched a slew of technologies to improve its service and boost sales. It’s part of an ongoing makeover that the Bolingbrook-based retailer launched in 2013. Dave Kimbell, the company’s chief merchandising and marketing officer, explains how Ulta is using apps, data, YouTube, Google and a digital dossier to make shopping more immediate, personal and fun and customers more loyal.
Q. How has technology and competition shaped your strategy?
A. Technology, mobile, and in-store technology are changing the expectations that a customer has when she is shopping. Our physical stores continue to play a huge role, but we grew our online business over 50 percent last year. We’re trying to innovate to meet her needs and get ahead of her expectations to personalize the experience whenever she wants it in the store, online or on an app. It’s critical to our competitive success because that’s how she wants to shop and other retailers that are focused on one or the other can’t do that.
Q. What technologies are you using?
A. There are three things we’re focusing on: The first is to help her have access to products whenever and wherever she wants them. We are one of the first retailers to partner with Google and their Google Express rollout. We also have a program online that’s giving her real-time access to our inventory.
Second is bringing technology into the store to drive a better experience with more information and education. The center of that is our “clienteling” initiative. The pilot started in early 2014 in 30 stores. It moved to 60 and we’ll expand to more stores later this year. It’s an application on a tablet that our associates use to provide better recommendations to our guests.
The third area is content to educate and engage our customers. Beauty is one of the top genres of YouTube. One thing we’ve done is partner with video bloggers. We have a section on our website for that. A customer will share what she’s excited about with her purchases at Ulta Beauty. These “haul” videos talk about 12 to 15 products. We have introduced technology that allows viewers to directly bring up that product to look at the ingredients, price and shades or purchase it at the same time she’s watching.
Another content thing is Mother’s Day is an important holiday in beauty. So this year we’ve built a gift section on our site. We’ve worked with our brand partners, with each of them telling stories about their own experience with their mothers. We have an insight that more than 79 percent of people don’t remember the last time they told their moms that she’s beautiful. We’re encouraging them to do that through social media activity.
Q. How will a customer experience the “clienteling” app?
A. Associates have regular customers and they keep track of them through note cards and other things. The associate has access to a wide variety of information about that guest, like whether they’ve shopped with us in the past, their previous purchases, how many points they have in the loyalty program and what they’ve redeemed.
Some of the information had historically been stored in paper form in a store. This tool will enable that associate to personalize and customize information. Over time, we can use that — depending on how much a guest wants to take advantage of it — to get information on how they want to be communicated with and specific areas of interest, like if they have dry skin. It also serves the guest if she goes into another Ulta that’s not her normal store.
Q. This kind of tool is used mainly by luxury retailers like Burberry. What led you to it?
A. We’re doing it to drive greater loyalty. Over 80 percent of our sales go through our ULTAmate Rewards loyalty program, and we’ve got 15 million members. (From its entire loyalty efforts), sales per loyalty member increased about six percent in 2014, driven by both higher purchase frequency and higher spend per transaction.