What Makes Sephora Such an Outstanding Omnichannel Retailer?
Last year, American consumers spent $517.36 billion online, accounting for 14.3% of total retail sales. Ecommerce growth is perpetually on the rise, but retailers shouldn’t prioritize their digital presence over their brick-and-mortar stores. Savvy retailers like Sephora, the undefeated champion of Sailthru’s annual Retail Personalization Index, are working on fusing the two into one seamless shopping experience that transcends channels.
Speaking on the latest episode of the National Retail Federation’s Retail Gets Real podcast, Mary Beth Laughton, the brand’s EVP of Omni Retail, explained why. “It’s about creating an attitude and a mindset around putting the consumer at the center of everything,” she says. “We coined this term ‘omnitude’ and it’s this idea that we’ll do whatever we can to delight our consumer wherever she’s shopping with us.”
How Technology Enhances the Sephora Store Experience
Brick-and-mortar stores are monumentally important to Sephora, in part because they’re where three-quarters of customers transact for the first time. They also provide the brand with valuable data it can’t capture online, improving personalization in the future.
“Stores play an important role because even with more and more touchpoints, like social and voice, people are longing for a personal connection in real life,” adds Mary Beth. “When they come into one of our stores, they can interact with one of our Beauty Advisors and get this really personal advice.”
Beauty products can be overwhelming. A search for “lipstick” on Sephora.com brings up 560 different items from dozens of brands. As a result, Sephora stores are filled with technology to help shoppers find the perfect products for them. For example, there’s an augmented reality fitting room, as well as Color IQ, which scans customers’ skin to match it with the right foundation — a huge pain point for beauty shoppers.
“There are thousands of SKUs and consumers are often like, ‘Ugh, I have no idea what lipstick or moisturizer to put on,” says Mary Beth. “You walk by this fixture and it throws the looks on your face. You can refine it by what you’re looking for, which makes it less overwhelming. Combine that with a Beauty Advisor who asks, ‘Oh, do you like that look? Let’s find you that lipstick.’”
Additionally, Beauty Advisors scan every product they use in makeovers. Afterwards, Sephora sends a log to the customer, making it easy for them to recreate the look themselves.
Omnitude Within the Organization
These technologies ultimately exist in-store to improve the shopping experience. As Mary Beth says, “It can’t just be a bunch of data and technology systems. It’s about bringing these experiences to life for consumers.”
That customer-centric, omnichannel approach extends to the organization itself. A year and a half ago, Sephora made headlines by merging its digital and physical retail teams.
Creating one team, Sephora made sure to align incentives. That way, the digital team was focused on overall sales, rather than prioritizing ecommerce. From the customer’s point of view, something that epitomizes the ‘omnitude’ is a use case familiar to any retailer: The proliferation of online returns in-store.
Individual stores feel the impact of online returns on their sales and payroll. However, Mary Beth points out that the opportunity far outweighs that hindrance, as evidenced by Sephora’s strong return-to-exchange ratio. Plus, there’s no need to drive customers into the physical stores; they’re already there.