SEPHORA:

The beauty of CRM in Digital Age

MKT404: Retail Marketing

Yukta Rustagi (1810110289)
 ABOUT THE COMPANY
INTRODUCTION SEPHORA is a multinational French chain of beauty
shops and personal care. SEPHORA offers almost 3 000
brands and private label products to create an enticing
customer experience and motivate boldness in the
society. They include cosmetics, skincare, body,
fragrances, color nails, beauty tools and haircare. A
leading provider of prestige retailed omni-retail
products.

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 INTRODUCTION

ABOUT THE COMPANY

The company was started in France by Dominique
Mandonnaud in 1970 by LVMH Moët Hennessy Louis Vuitton,
the leading global luxury products company. It is represented
by a unique open-sell environment that features a continually
increasing range of products from carefully curated brands,
including indie darlings, emerging favorites, favored classics,
and SEPHORA's own, SEPHORA COLLECTION.

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 WHY SEPHORA IS A
MARKET LEAD ?

TARGETING THEIR CUSTOMERS

Unique Customer Loyalty Customer Generated Omni- channel Retail
Structure Content Experience
SEPHORA has it’s unique approach Insider Beauty Community- Integration of the
to rewards- Rewards Bazaar, Free Forums about beauty tips, online and offline stores
makeovers, Birthday samples etc. live chats with influencers

1 2 3

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 LOYALTY PROGRAM

Tiers
Beauty Insider program at Relationships The SEPHORARewards
brand has become
The  loyalty program is
SEPHORA has effectively synonymous with prestige, quality,
hinged on creating
segmented shoppers into three and luxury - all of which are
relationships and powered
groups: Beauty Insiders, VIB, reflected in what they offer as
by peer-peer feedback.  5
and VIB Rouge. customer rewards.
“SEPHORA’s Beauty Insiders program creates a strong
bond between brand and consumers, as 80% of members
refuse to consider a competitor.”

Tiers are amongst the best ways to drive a desired behavior VI

B

CUSTOMER PYRAMID
with a loyalty program. By dividing customers into different
groups, each level can be used to challenge buyers to see Ro
whether they can achieve the next milestone. SEPHORA has gu
selected to use the dollars spent model in its loyalty e
programme, based on the number of orders, loyalty points Very Important
or total dollars spent. Beauty Insider
The highest tier- VIB Rouge.  VIB Rouge is open only to (VIB)
customers who spend $1000 per year, thus creating a sense
of exclusivity.
Beauty Insider
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 INSIGHTS: LOYALTY
PROGRAM
Loyalty Program = Innovation + Technology + Staff
Training = Better Retail Experience

Why Do Customers Want Loyalty Programs?

Better Customer Experience Personalization
Unique collection offers limited SEPHORA uses Modern CRM, it helps
edition and exclusive product the customers personalize their
releases solely for its rewards experience, SEPHORA’s Beauty Insider
members. loyalty program offers lots of these
modification based on the buyer’s
profiles.

Offers & Gifts Social Status in the community

Free makeovers, free beauty VIB Rogue is considered to be tough to
classes, and services in addition attain and is also considered as a social
to products, complimentary symbol of prestige.
birthday samples 7
https://www.SEPHORA.com/beauty/loyalty-program
#VIBRouge – Social Status

Reward Bazaar

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The HYPE of UNBOXING SEPHORA VIB
UNIQUE Products!!!!

VIDEO - https://www.youtube.com/watch?v=SJ3iHZtpaBc

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“Customers want entertainment and they are not thinking about channels,
expecting retailers will make it as easy as possible for them.”

~ A SEPHORA Spokesperson

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SEPHORA’S DIGITAL TRANSFORMATION

Over the years the website has grown tremendously

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 OMNI CHANNEL RETAIL
COMPONENTS

1. BEACONS 3. AUGMENTED REALITY

In stores worldwide to deliver Omni – retail channel, “try before
real time, personalized alerts to you buy”, SEPHORA IQ, etc.
customers who opt-in

1 2 3 4
2. SEPHORA FLASH 4. POCKET CONTOUR AND
SEPHORA Flash is a INNOVATION LAB
disruptive concept that blends Venus has a beautiful name and is
beauty and technology. the second planet from the Sun

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 1. BEACONS
“We want to make shopping extremely personalized and beacons are magical, we
are able to target them when in the store with welcome messaging, reminders about
their mini-makeover session.” - said Venkat Gopalan, senior director or
architecture and development at SEPHORA.

• SEPHORA is exploring a number of types of messages

triggered by a beacon when customers with the
SEPHORA app on their phones walk into a store.
Customers will also be able to access phone
notifications. SEPHORA will deploy Beacons  in shops
globally, to provide individual real-time customer
alerts. Shoppers can get notifies for events, such as
birthdays, updates of the loyalty program benefits and
notifications of the current happenings in the store.
• INSIGHT HERE IS live events and notification attract
customers to the retail outlets.
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 2. SEPHORA FLASH

• What is SEPHORA Flash? SEPHORA FLASH is an annual

shipping subscription. SEPHORA FLASH costs only $15 and
get a regular online order and you get 2-day transport all year-no
need to be a Rouge Member, no minimum purchases and no
limits as to how many times a customer can use this service.
Present Rouge Members can upgrade to FLASH Shipping in
their account settings, free of charge for one year or the duration
of your Rouge status.
• INSIGHT HERE IS that SEPHORA knows with the
developing economy , consumers tend to make their purchases
online , and also because of the high shipping costs many cancel
their entire purchase list.

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https://www.SEPHORA.com/product/SEPHORA-flash-subscription-P379518
3. CUSTOMER GENERATED CONTENT &
OMNI RETAIL CHANNEL
• Makeup and beauty products can be overwhelming. A
quest on SEPHORA.com for "lipstick" generates 560
different products from literally hundreds of brands. In
result, SEPHORA stores have a technology to help
buyers find a suitable and perfect product for them.
• Beauty Consultants scan each makeover product.
SEPHORA then sends the customer a log so that you
can easily recreate a look for themselves.
• THE INSIGHT HERE IS that SEPHORA knows that
a consumer would first want to try on a product, see if it
suits them and only then move ahead and purchase it.

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• SEPHORA launched shopbots/chatbots on their
websites as well which provide makeup and
beauty tips, customer reviews and replies to
customer service. SEPHORA's messaging app
KiK is highly committed in chatbots that 'adapt'
and effectively 'learn' allowing them to make
proposals that are based on the history and
products that best suit specific customer
requirements.’
• INSIGHT HERE IS customers while purchasing
such a complex product, makeup would want
assistance, guidance and information regarding
various things that would help them choose the
best item out of the thousands SEPHORA has to
offer to them.

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HAVE YOU TAKEN THE SEPHORA QUIZ
YET?

This is an example of how SEPHORA generates

SEPHORA evaluated their feedback from

customer driven content.

customers and user reviews, and noticed
that a common pain-point for their
consumer was that they made a purchase
that didn't match their skin requirement
properly and caused undesired annoyance
and frustration. SEPHORA has created a
range of Online Additional Information
such as Quizzes and Purchase Guides to
help  shoppers make the best buying
decisions in order to help fix this problem
and thereby enhance the entire customer
experience.

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SEPHORA COLOR IQ
“Modern day loyalty isn’t ONLY about points and tiers in retail, it's
about personalization, and the Color IQ and its touch points are all
about that. When you’re talking about generating loyalty, we’re
talking about generating relevance with consumers.” - said Zach
Paradis, director of experience and innovation strategy at Sapient
Nitro.

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 4. POCKET CONTOUR AND
INNOVATION LAB

The  Pocket Contour, a product which offers a tuition to

complement the user's specific face shape using a mobile
device. The customer receives step by step guidelines and
product recommendations by uploading a selfie to the app

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https://www.fastcompany.com/3043166/first-look-inside-SEPHORAs-new-innovation-lab
 Insight behind developing all of this is customer
needs ,feedback
and review.

“Our digital innovations have always been developed with the client
in mind–what will be useful and helpful to her,” as opposed to trying
a bunch of technologies to be buzzy and interesting.”

“ Contouring is a bit tricky for the average client–you can watch a tutorial for how to do it, but what I need
to know is where to apply the makeup on my very own face ,this is a 360-degree approach to contouring. If
we’re going to tell our clients that contouring is the next trend, we better teach her how to do it. We of
course have mini-makeovers in the store where we’ll apply contouring makeup, but if you can’t do it when
you get home, we’ve disappointed you.” - says Dolan.

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 “SEPHORA stores are like playgrounds for beauty
enthusiasts.”

• In store experience is filled with

technology and innovative means to
satisfy the consumer needs. INSIGHT
HERE IS the company knows how to
make the customer experience
interactive and fun.
• Make-up artists use iPads as well as
other devices with customers to display
dozens of shades and colors until the
buyers' are truly and fully satisfied with
the product.

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“Try to Buy Model”
“We want to give the customer the confidence to pursue these
benefits, give her permission.”

— says DOLAN
CUSTOMER RETENTION THROUGH EVENT MARKETING AND SOCIAL MEDIA AWARENESS
+ CONTENT KEEPING IN MIND THAT CUSTOMERS PREFER PERSONALIZATION OF THEIR
PRODUCTS

SOCIAL TUTORIAL
MEDIA S

SEPHORA makeup tutorials by

Using #sephoria and brands gave attendees free
professional makeup artists and
product samples in exchange for tagged photos on
beauty enthusiasts.
Instagram.> Event Marketing by Celebrities

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 INSIGHTS

INSIGHTS FROM SEPHORA

Customer Feedback is Important
Data Analysis and Implementation is Makes them feel more than just
key to constant growth and a way through purchasers, increases loyalty and
which the brand was able to capture the commitment towards the brand
target market or even retarget the
customers
“Data is currency to us” – SEPHORA
Spokesperson.

Uniqueness + Technology
integration in online and offline
retail = SUCCESS
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 RESOURCES
LINKS
◂ https://blog.smile.io/loyalty-case-study-SEPHORAs-beauty-insider-vib/
◂ https://contentwriters.com/blog/SEPHORA-reward-marketing/
◂ https://loyaltylion.com/blog/spotlight-SEPHORA-beauty-insider-loyalty-program
◂ https://digital.hbs.edu/platform-rctom/submission/the-beauty-of-crm-in-a-digital-age/
◂ https://www.SEPHORA.com/beauty/loyalty-program
◂ https://digital.hbs.edu/platform-rctom/submission/beauty-in-the-age-of-individualism-SEPHORAs-data-driven-appro
ach/
◂ https://www.cbinsights.com/research/report/SEPHORA-teardown/
◂ https://postfunnel.com/analyzing-the-makeup-of-SEPHORAs-marketing/
◂ https://blog.applovin.com/SEPHORA-marketing-strategy-analysis/
◂ https://www.retaildive.com/ex/mobilecommercedaily/how-SEPHORA-leverages-loyalty-data-to-optimize-segmentat
ion
◂ https://static1.squarespace.com/static/562661f7e4b078eb0eb8898c/t/56ca85d3746fb93e227cfd8a/1456113163208/D
EVELOPING+a+MARKETING+PLAN-+SEPHORA.pdf
◂ https://www.annexcloud.com/blog/the-makeup-of-SEPHORAs-marketing-strategy/
◂ https://digitalbeauty.com/SEPHORA-vs-ulta-competitor-analysis/
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 RESOURCES
VIDEOS
◂ https://youtu.be/fqkao47kXtg

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THANK

THE END
YOU!

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