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7 Mar

How Ulta Is Resetting the Mass Beauty Shopping Experience

How Ulta Is Resetting the Mass Beauty Shopping Experience

Ulta Beauty is upping its mass game.

The retailer has bolstered the mass side of its business over the past few months. It has added each in-store and online a slew of color-cosmetics brands favored by Millennial and Gen Z consumers, including ColourPop, Morphe, Wet ‘n’ Wild, Flower Beauty and Kiss Lashes. Existing brands inside the retailer’s assortment — E.l.f., L.A. Girl, Essence, Milani, Almay and Makeup Revolution — have been expanded in each shelf space and door counts.

Ulta’s mass makeover is a way to level the shopping experience between the mass and prestige sides of the shop, company executives said.

Ulta has at all times been known for its unique merchandising strategy that merges mass with class. The retailer has made considerable strides previously few years in amping up its prestige assortment — nabbing Lauder-owned brands resembling MAC Cosmetics and Bumble and bumble, and launching exclusive items which have change into cult hits, like Tarte’s Shape Tape concealers. Ulta revealed the last word luxe addition — Chanel — on its fourth-quarter earnings call last week. However the retailer is equally focused on bringing in popular brands on the mass side of the business as well.

A lot of Ulta’s mass brands have upgraded their in-store fixtures with backlighting, daring graphics and testers. Fixtures stocked with K-beauty sheet masks have been expanded, and end caps now highlight trending brands like BH Cosmetics and latest Ulta-exclusive items, resembling Pacifica’s Crystal skin-care collection and Morphe’s Jaclyn Hill palette.

Exclusive products and experiences have gotten an increasing focus inside Ulta’s mass category. Neutrogena in April will launch a makeup collaboration with Kerry Washington exclusively at Ulta. Revlon earlier this month unveiled a product vending machine that may travel to store locations throughout the country. Ulta Beauty Collection, Ulta’s private label line, was moved to a bigger space along a lit back wall, modernized with updated packaging, and on-trend items like juice-infused lip oils and a dry sheet mask have launched for spring.

“We’re laser-focused on constructing a robust and consistent experience for our guests across [the entire Ulta store],” said Monica Arnaudo, senior vp of merchandising. “They’ve an expectation that we’re bringing newness and relevant brands which are either trend-focused or they’re seeing them on social and digital.”

Arnaudo joined the corporate in October and oversees the mass side of the business, which incorporates the private label collection — her counterpart on the prestige side is Tara Simon, senior vp of merchandising for prestige beauty. Simon’s purview encompasses brands like Urban Decay, Profit Cosmetics, Lancôme and Tarte.

“It starts with what we consider the guest is on the lookout for,” said Arnaudo. “We’re at all times asking our store teams, ‘What brands do you get requests for?’ Then we glance on the social side. Brands like Morphe and ColourPop have gained plenty of traction. It’s essential for us to get these brands. It’s a win-win for us — our guests are on the lookout for them, and it drives traffic in. They’ve been only been available online so their customer base can’t see or play, and we provide that for her.”

The mass category also serves as some extent of entry for Ulta shoppers. “We definitely see plenty of guests coming in which are brand latest to Ulta start out shopping in mass and so they only buy mass,” said Arnaudo. “As they proceed to buy inside Ulta, we see that in 12 months two and 12 months three they start to enter into the prestige side.”

Ulta customers are proven to buy each categories — store data shows that 77 percent of Ulta’s customer base shops the 2, and only 23 percent shop only prestige or only mass.

The retailer’s mass revamp is coming at a time when drug chains are fighting sales losses as a consequence of low foot traffic and online shopping. Nielsen scanner data from the top of February tracked mass makeup as down 1 percent year-over-year, and key categories like face and eye were down 5 percent and a couple of percent respectively, in line with IRI data tracking the last 12-week period.

“[Ulta is] smart enough to acknowledge [it needs] to proceed to bolster to [its] beauty shopper a holistic approach to the offering and wrap the experience around the complete store, and never just enhance one side of the business,” said Wendy Liebmann, chief executive officer of WSL Strategic Retail. “It’s also a bonus to [Ulta] versus Sephora due to holistic nature of the way in which [it presents] beauty in any respect price points.”

Boosting its mass beauty assortment with digital-first, indie brands is one other way for Ulta to distinguish itself from Sephora, and proceed to lure young, beauty-obsessed shoppers.

“Ulta a lot has [its] pulse [on what is trending],” said Evelyn Wang, senior vp of selling at Wet ‘n’ Wild. “They saw that Wet ‘n’ Wild was gaining traction on social media and recognition with influencers, and that’s what propelled the conversation with them.”

After the brand’s exclusive Mermaid collection sold out on ulta.com last 12 months, the retailer placed an assortment of the Markwins-owned brand’s core collection in two-thirds of its doors in January.

“Our consumer is a Millennial, Gen Z, makeup-involved consumer who could be very much a cosmetics junkie and definitely someone who shops across multiple brands and is, in a way, channel-agnostic. She wants all the pieces at her fingertips. She buys plenty of units, and that’s something we bring to Ulta,” said Wang.

Ulta is equally focused on stocking a various assortment of brands because it is on upgrading the mass shopping experience to match that of the prestige side.

“For those who’re going to present product [at all price points], the experience must be consistent throughout,” said Bruce Teitelbaum, chief executive officer of RPG, a retail design firm in Latest York that works with many beauty brands. “They’ve really found out a formula for offering their customers a singular assortment with a unified appearance.”

Teitelbaum has recently worked with Revlon and Sally Hansen on universally upgrading their in-store appearances with retailers across the category. At Ulta, company policy allows for brands to design their very own fixtures, which provides more flexibility. Revlon’s redesigned in-store wall with the retailer is complete with lit shelving; daring, modernized graphics and space for testers.

“Most mass brands have a really large stockkeeping count, and when presented on a wall or gondola, the product is amazingly dense,” said Teitelbaum. “They traditionally haven’t thought along the lines of prestige, in you could have good merchandising, good navigation, impact and vision and you possibly can do it an efficient fashion with a fantastic appearance. That thought process is starting to alter.”

Makeup Revolution, a U.K.-based color cosmetics brand that launched exclusively with Ulta within the U.S. last 12 months, built customized, modular fixtures in anodized rose gold for its store presence in all of the retailer’s doors.

“We call it our fast beauty fixture due to speed and ease for stores to give you the option to restock it,” said Kate Kimmerle, president of Makeup Revolution.

A few of Makeup Revolution’s products — just like the Banana baking powder and Conceal and Define concealer — have been “flying off shelves” at Ulta, said Kimmerle. “If we notice the Banana powder is blowing out, selling hundreds of units, we will quickly produce one other shelf for just that shade and stick it above the prevailing shelf with the opposite baking powders — we could be flexible based on how items perform,” said Kimmerle.

Launching in Ulta has allowed Drew Barrymore’s Flower Beauty to enhance on its in-store experience — the brand developed illuminated fixtures with a top shelf that acts as a tester bar for launches. The brand can be launching exclusive products which are more trend-driven than Flower’s offering at its only other retail partner, Walmart — for example, the Galaxy Glaze Holographic Lip and Beauty Flash Full Face Palette.

“They take the omnichannel approach very seriously,” said David Hutchinson, senior vp of Maesa Group, which manufactures Flower. “After we launched Flower, they did a sneak peek online to their Ultamate Rewards members to introduce them to the brand, which drove them into stores to find it. They promote and story-tell the brands and products across different channels after which follow up with a fantastic in-store experience with passionate store associates really informed on the brand offering to offer that education.”

Ulta recently shifted a few of its store associate roles to focus solely on the mass side of the shop. The retailer can be starting to evolve the shop layout to raised reflect burgeoning categories. “We’ve expanded K beauty and improved the general navigation in skin,” said Arnaudo. “Bath is a fun category for us — in just below 300 stores, we elevated our bath presentation and added three fixtures [next] to mass cosmetics with brands like Body Shop, Rituals and Cowshed.

“What’s essential for us is to make sure that we’re presenting all our categories in the way in which that the guest desires to shop. That’s top of mind for us, and we’ll proceed to evolve it,” said Arnaudo.

Also top of mind for Arnaudo is highlighting Ulta’s large collection of foundation shades — the retailer carries greater than 3,100 across the complete store. With reference to bringing in latest brands, Arnaudo is on the hunt for more “inclusive” and “diverse” lines, together with the digital-first brands along the lines of Morphe and ColourPop.

“There’s definitely this middle ground — brands coming in the center range that look quite prestige but offering the mass price point,” said Arnaudo. The chief’s own background is in prestige beauty — she got here to the retailer from Clarisonic, and before that served because the senior vp of U.S. sales at Bare Escentuals. “Because beauty is moving so fast, our guests aren’t as brand loyal and it’s about what’s hot and what’s latest, what’s socially relevant,” said Arnaudo. “We now have to remain on top of it.”

Ulta’s re-tooling of its mass category is indicative of a bigger shift that is going on inside the mass market — most aggressively inside makeup, said Jefferies analyst Stephanie Wissink.

“When Ulta [was founded], the mass concept was one other drugstore look-alike — it was built as a venue for legacy, staple brands,” said Wissink. “They’re reverse-engineering mass.”

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