How Sephora Revolutionized Makeup Consumption | WSJ The Economics Of

00:06:09
https://www.youtube.com/watch?v=Y9b5HBSpbqs

摘要

TLDRThe video describes how Sephora transformed the luxury makeup retail industry through its innovative approach of allowing customers to freely test products without the previous restrictions of makeup counters. Founded in France in 1969, Sephora adopted a self-service model and focused on inclusivity and customer engagement, significantly changing consumer behavior in the beauty market. Owned by LVMH since 1997, Sephora has expanded its offerings and now leads with over 2,700 global locations. Its Beauty Insider program collects valuable customer data to enhance marketing, while continuing its commitment to diverse products.

心得

  • 💄 Sephora revolutionized the makeup shopping experience by introducing a self-service model.
  • 🛍️ Customers can freely test products, transforming retail norms.
  • 🌍 Sephora operates over 2,700 stores in more than 35 countries.
  • 📈 The Beauty Insider program helps Sephora personalize marketing via customer purchase data.
  • 🌈 Inclusivity is a focus for Sephora, featuring diverse brands in stores.
  • 🤝 Sephora's partnership with Kohl's aims to expand its market reach.
  • 📚 Color IQ technology enhances the customer experience by matching skin tones.
  • 🎉 Sephora carries over 250 beauty brands, boosting variety for consumers.
  • 🏆 LVMH ownership provides Sephora with trend responsiveness.
  • 🔍 Sephora emphasizes exclusive product offerings to maintain consumer loyalty.

时间轴

  • 00:00:00 - 00:06:09

    The video discusses how Sephora transformed the luxury makeup industry by introducing a self-service shopping model, allowing customers to freely test products, compared to the previous service-based model. Founded in 1969 in France, Sephora now operates over 2,700 stores globally, featuring over 250 beauty brands. Part of its success is attributed to its relationship with LVMH, which allows it to quickly adapt to market trends. Additionally, Sephora builds customer loyalty through exclusive product lines and a structured rewards program, while promoting inclusivity by offering a range of brands, including those from underrepresented groups. The recent partnership with Kohl's further expands its reach, aiming to solidify its position as a leader in the prestige beauty market.

思维导图

视频问答

  • What business model did Sephora use to change the makeup shopping experience?

    Sephora introduced the assisted self-service model, allowing customers to freely test products.

  • When was Sephora founded?

    Sephora was founded in 1969 in Limoges, France.

  • Who owns Sephora?

    Sephora was sold to LVMH in 1997.

  • What is Sephora's Beauty Insider program?

    A loyalty program with three tiers that rewards customers based on their spending.

  • How many Beauty Insider members does Sephora have?

    Sephora has over 25 million Beauty Insider members.

  • What inclusivity efforts has Sephora made?

    Sephora features a larger number of brands, including black-owned ones, and offers personalized skin tone matching.

  • What recent partnership did Sephora announce?

    Sephora partnered with Kohl's to install shops in their stores.

  • What major retail strategy did Sephora employ to handle customer preferences?

    Sephora uses customer purchase data from the Beauty Insider program to personalize marketing.

  • What is Color IQ?

    A skin tone matching technology that helps customers select appropriate products.

  • How many stores does Sephora operate globally?

    Sephora operates in over 2,700 stores in more than 35 countries.

查看更多视频摘要

即时访问由人工智能支持的免费 YouTube 视频摘要！
字幕
en
自动滚动:
  • 00:00:00
    (upbeat music)
  • 00:00:02
    - There really is a before and after Sephora,
  • 00:00:05
    when it comes to the makeup industry.
  • 00:00:07
    - [Narrator] Until about 20 years ago,
  • 00:00:09
    this is how most Americans shopped for luxury makeup.
  • 00:00:12
    A sales representative of the brand
  • 00:00:14
    would stand behind the makeup counter
  • 00:00:16
    and help customers make a purchase.
  • 00:00:18
    - That completely changed with Sephora.
  • 00:00:20
    Now it's a free for all, people walk in the stores,
  • 00:00:23
    they test whatever they want,
  • 00:00:24
    nothing is behind the glass.
  • 00:00:26
    - [Narrator] So, how did this French retailer
  • 00:00:29
    come to dominate the global personal care
  • 00:00:31
    and beauty product industry
  • 00:00:33
    and what business practices helped make it
  • 00:00:34
    the industry leader that it is today?
  • 00:00:38
    This is the Economics of Sephora.
  • 00:00:43
    Today, the beauty retailer employs over 36,000 people
  • 00:00:47
    in more than 2,700 stores, in over 35 countries.
  • 00:00:52
    Those stores carry over 250 beauty brands.
  • 00:00:56
    - [Man] At this point,
  • 00:00:57
    Sephora's like kind of my second home.
  • 00:00:59
    - [Narrator] The Sephora that we know today has its roots
  • 00:01:01
    in a small perfume shop that opened in 1969
  • 00:01:05
    in Limoges, France.
  • 00:01:06
    At that time, the perfume and cosmetics market
  • 00:01:09
    was dominated by a service-based retail model
  • 00:01:12
    in which staff typically received commissions
  • 00:01:14
    based on sales.
  • 00:01:16
    Instead, Sephora used the assisted self service model,
  • 00:01:19
    in which customers are free to test products in the store.
  • 00:01:22
    - You have a full where you can just
  • 00:01:24
    like literally grab whatever
  • 00:01:25
    and you can try on the lipsticks,
  • 00:01:27
    you can try in the eye shadows.
  • 00:01:28
    I always leave looking like a literal different person
  • 00:01:30
    than I arrive.
  • 00:01:31
    - [Narrator] Sephora customers can still request help
  • 00:01:34
    from a sales associate who Sephora calls a beauty advisor.
  • 00:01:37
    - A little bit more trust with the sales representatives
  • 00:01:40
    in a Sephora store, because they're brand agnostic.
  • 00:01:43
    So they can tell you,
  • 00:01:44
    maybe you should buy the mascara from this brand,
  • 00:01:47
    but you should buy the blush from a different brand.
  • 00:01:50
    - [Narrator] Sephora also bucked convention
  • 00:01:52
    in the manner in which it displayed its products.
  • 00:01:55
    - [Woman] So make-up items are next to each other.
  • 00:01:57
    Whereas from the same brand,
  • 00:01:59
    a fragrance would be in the fragrance aisle.
  • 00:02:01
    From the same brand,
  • 00:02:04
    a skincare product would be in the skincare isle.
  • 00:02:06
    - [Narrator] Then in 1997, founder Dominique Mandonnaud
  • 00:02:07
    sold Sephora to the large luxury retail conglomerate, LVMH.
  • 00:02:11
    - One of the advantages of being owned
  • 00:02:13
    by a conglomerate like LVMH,
  • 00:02:15
    is that the company can jump very quickly on trends.
  • 00:02:19
    And actually, several of the brands that are sold
  • 00:02:22
    in Sephora stores are owned by LVMH.
  • 00:02:25
    - [Narrator] One of the popular brands owned by LVMH
  • 00:02:27
    is Fenty Beauty by Rihanna.
  • 00:02:29
    - [Woman 2] And then Fenty of course has a huge section.
  • 00:02:32
    The whole row of Fenty, we got the lip glosses up front.
  • 00:02:35
    - [Narrator] Sephora's success also stems
  • 00:02:37
    from its exclusive line of products.
  • 00:02:39
    - There's a little bit of a tension
  • 00:02:41
    in the relationship between a store and a brand.
  • 00:02:43
    Because Sephora is such a hot store
  • 00:02:46
    for makeup brands to sell their products in,
  • 00:02:49
    Sephora ends up having a lot more leverage
  • 00:02:52
    in that relationship.
  • 00:02:53
    - [Woman 3] The Sephora collection.
  • 00:02:55
    - [Woman] The challenge for high-end beauty brands
  • 00:02:57
    these days is that they're really facing a conundrum.
  • 00:03:00
    They've become increasingly dependent on Sephora
  • 00:03:02
    for sales growth, but because LVMH
  • 00:03:05
    also produces beauty brands
  • 00:03:06
    and there's an element of competition there,
  • 00:03:08
    and more brands are coming out constantly.
  • 00:03:10
    The shelf space is shrinking.
  • 00:03:13
    - [Woman 4] Five Sephora products you need to try part 10.
  • 00:03:15
    - [Narrator] In part due to that product exclusivity,
  • 00:03:18
    Sephora boasts a loyal customer base.
  • 00:03:20
    - Here are five Sephora products you need to buy tonight.
  • 00:03:23
    Sorry, I don't make the rules you just have to.
  • 00:03:25
    - So what you'll find oftentimes on Instagram or TikTok,
  • 00:03:27
    is that people have these haul videos
  • 00:03:29
    where they're showing all the products that they bought
  • 00:03:31
    in Sephora, and they're going one by one,
  • 00:03:33
    talking about them.
  • 00:03:34
    - [Man] This is the KOSAS tinted face oil, and it's $42.
  • 00:03:37
    I recommend this product to everyone
  • 00:03:39
    and they're always like I'm paying $42
  • 00:03:42
    for a face oil, yes you are.
  • 00:03:44
    - [Narrator] Many faithful customers
  • 00:03:46
    are members of Sephora's Beauty Insider program,
  • 00:03:49
    which has three different tiers
  • 00:03:50
    and more than 25 million members.
  • 00:03:53
    The lowest tier is the Beauty Insider.
  • 00:03:56
    The next level up is VIB, or Very Important Beauty Insider,
  • 00:04:00
    which users must spend $350 in a calendar year to unlock.
  • 00:04:04
    The top level is called Rouge, which customers can access
  • 00:04:07
    after spending at least $1000 in a calendar year.
  • 00:04:11
    Benefits like savings increase with each tier.
  • 00:04:14
    - I'm Rouge, don't judge me, I know I spend a lot of money.
  • 00:04:17
    Okay, I get it.
  • 00:04:18
    - But the real advantage for Sephora
  • 00:04:19
    for the beauty rewards program is that every time
  • 00:04:23
    a customer goes in there,
  • 00:04:24
    Sephora knows exactly what they bought.
  • 00:04:27
    And that is very valuable information for the company
  • 00:04:29
    to understand who the customer is,
  • 00:04:32
    what they're purchasing and then down the road,
  • 00:04:34
    be able to market in a very personalized way
  • 00:04:36
    to that customer.
  • 00:04:37
    - [Narrator] Yet as much as the company profits
  • 00:04:38
    on exclusivity with its products,
  • 00:04:41
    when it comes to Sephora's consumer base,
  • 00:04:43
    the retailer takes inclusivity seriously.
  • 00:04:47
    - One of the ways that Sephora has tried to become
  • 00:04:49
    more inclusive is by featuring a larger number of brands
  • 00:04:52
    in their stores, they've made an effort
  • 00:04:53
    to include black owned brands,
  • 00:04:55
    and then also by pushing brands
  • 00:04:57
    to expand their product lines and offer products
  • 00:05:01
    that appeal to people from different racial groups,
  • 00:05:04
    different ethnicities.
  • 00:05:05
    - [Narrator] In 2021, Sephora relaunched Color IQ,
  • 00:05:09
    a skin tone matching technology.
  • 00:05:11
    The company offers to assist customers
  • 00:05:13
    in selecting the most natural products for their skin tone.
  • 00:05:16
    - [Woman 5] All the products that would be your exact color.
  • 00:05:19
    - [Narrator] And Sephora is still expanding.
  • 00:05:21
    In December 2020, the company announced a partnership
  • 00:05:24
    with the department chain Kohl's,
  • 00:05:26
    to install 850 shops inside Kohl's stores by 2023.
  • 00:05:31
    Since opening 200 Kohl's locations this summer,
  • 00:05:33
    Sephora has added 200,000 new Beauty Insiders.
  • 00:05:37
    in a statement to the Wall Street Journal,
  • 00:05:39
    a Sephora spokesperson said, we want to be an unequivocal
  • 00:05:42
    global leader in the prestige beauty space
  • 00:05:44
    and a purpose driven brand
  • 00:05:46
    that is a transformative opportunity for everyone we touch.
  • 00:05:50
    They continued by outlining three main areas,
  • 00:05:52
    customers, brands and teams.
  • 00:05:55
    - Sometimes when customers step outside
  • 00:05:57
    of the Sephora store, they will have splotches
  • 00:05:59
    of makeup all over their arms.
  • 00:06:00
    And that really showcases
  • 00:06:02
    what they've been doing in this store.
  • 00:06:03
    (gentle music)
标签
  • Sephora
  • Makeup Industry
  • Retail
  • Beauty Insider Program
  • LVMH
  • Inclusivity
  • Color IQ
  • Shopping Experience
  • Customer Loyalty
  • Product Range