Since the start of the third quarter, Ulta Beauty has introduced a new design to some 44 stores to better showcase its mass and prestige categories, improve navigation, enhance the service experience and create more discovery opportunities.
Compared to its last comprehensive marketing overhaul, in 2018, Ulta Beauty’s latest update puts more emphasis on its service offerings. It includes new eyebrow and makeup services, offered in partnership with Benefit and MAC Cosmetics, through new beauty bars located in the center of the store. Each new store and each remodeled store will feature the new layout design. Ulta Beauty has long offered hairstyling services through a back bar program with brands like Briogeo. During the retailer’s third-quarter 2022 earnings call in December, Dave Kimball, CEO of Ulta Beauty, commented on the importance of salon services.
“Our services business accelerated and delivered another quarter of like-for-like double-digit growth, primarily due to higher stylist retention, higher stylist productivity and increased capacity in our salons, as we exceeded capacity constraints due to to the pandemic,” he said. “Our targeted CRM efforts to drive awareness, testing, and frequency are working, increasing in-salon appointments from new and existing ones. [customers]. Our in-store back bar events also continued to drive product linking and new guest acquisition for participating brands.”
Ulta Beauty’s new merchandising strategy comes nearly two years after the retail industry felt the brunt of Covid-19 in 2020. Since brick-and-mortar stores reopened, retailers have seen temporary effects, including exclusive focus in e-commerce, they have given way. to longer-term industry trends like omni-channel, wellness, and a customer focus on values. According to Monica Arnaudo, Ulta Beauty’s director of merchandising, the fact that the consumer journey is no longer linear influenced the new strategy. The Ulta Beauty team considered consumer adoption of online shopping, in-store pickup, and curbside pickup.
Also recently located within the shopping center were the elevated gondolas that house the brands Estée Lauder, Clinique and Lancôme, which Arnaudo called the perfect transition brands between prestige and masstige. They also span makeup and skincare products, which are categories on opposite sides of the store.
“Beauty services can mean an extra visit, which can result in product purchases beyond the beauty service itself,” said Manola Soler, a senior director at Alvarez & Marsal Consumer Retail Group, a professional services firm. “Services have been part of [Ulta’s] long-term strategy and remain at a relatively low penetration of total revenue, around 3-4% in recent years. Well-executed services present an opportunity to increase their share of consumers’ beauty wallets and could have a halo effect on their overall spend with the retailer.”
Other notable changes to Ulta locations include a skincare repositioning to the front of the store, fueled by overall category growth over the past three years. All skincare has come together, flowing from masstige to prestige brands. In the pre-existing layout, prestige skincare was placed towards the rear of the store on one side, and mass skincare was placed in front of the store on the opposite side. On another side of the store is now the makeup, which also flows from mass to mass and prestige. Fragrance has moved to the back of the stores and there is now a dedicated space at the front of the store for brand and product launches across all categories. Also, the box has been moved closer to the salon. As Glossy reported in 2018, Ulta Beauty’s strategy of offering prestige and mass products is central to its strategy.
“This is a great evolution for us. It was important for us to consider the feedback we were getting,” Arnaudo said. “Us [wanted to] create an experience that was easy for [customers] to navigate, so they could spend their time playing and discovering and being inspired, instead of spending time trying to find things.” Who said that?
Source: news.google.com