Alexandre Meerson, chief digital, data and technology officer EMEA, Sephora, speaks to Emma Herrod as part of the newly published RetailX Global Beauty 2024 Report.
Sephora is a global, omnichannel retailer selling a curated mix of prestige beauty brands. Its loyalty scheme has 150mn members, with half of them being what the company describes as “very active”. These customers are always on the lookout for innovations, both in terms of the products they buy and the services offered requiring Sephora to not just be a leader in the market but to challenge itself as well.
Sephora’s success resides in its efficient and data driven approach to retail. It is guided by the constants of operational excellence, attention to detail, constantly reviewing processes, availability, sales ceremony etc, while at the same time, being driven by data, fuelled by traffic and customer relationships.
Additionally, Sephora is a brand in its own right, it has a point of view, and that shows through in how it curates products, the assortment and exclusive brands it offers. “That creates an attraction and customers seek our advice and point of view,” says Alexandre Meerson, Chief Digital, Data and Technology Officer, EMEA, Sephora. “It gives us the responsibility to always look to satisfy our current customers and, at the same time, offer them something new,” he adds.
The omnichannel customer
The digital team at Sephora in Europe and the Middle East is accountable for the P&L of the entire retail tech experience across all channels including ecommerce and the business generated in store with digital tools. This means a single team is focussed on both the design and delivery of omnichannel services, as well as being accountable for the end-to-end customer experience online and in store. The team incorporates an array of functions including data insight, product UX and technical teams working on all areas of retail technology including point-of-sales payments, anti-fraud measures and customer service. More importantly, the digital team operates as a commercial business team.
“We’ve buried the old approach, which was to look at conversion. Conversion is just an output of multiple actions and plans and strategies to improve sales. So now we only look at the customer; at customer engagement, at customer value, at purchase value, and returning customers,” explains Meerson.
This switch has required a longer term, more sustainable viewpoint to be taken, and one that’s taken from the perspective of the omnichannel customer. “We take a longer term view of our business because what we want is to make sure that our clients are satisfied and happy and that when they think beauty they think Sephora. We can only achieve this by creating a community of omniclients that are satisfied,” says Meerson.
As such his team takes a holistic view of the omnichannel business. “We don’t look at ecommerce or retail alone.” As a business, Sephora is seeing benefit in this change as responsibility to drive growth rests with the digital team, resulting in an already profitable channel “growing significantly”. It has highlighted the importance of investment online as well as offline.
Online, the focus is on personalisation, offering the right content, the right information, developing interaction and engagement while the focus instore sees the LVMH-owned business delivering services that go beyond verbal advice. This includes tools that help beauty advisors in their interactions with customers.
“We work hand-in-hand with the retail teams to make sure that when we implement something everyone is properly trained and we get feedback from the field. Each implementation has a business case which spans over the years, and this includes adoptions. So, it’s not about adding more features, but it’s implementing the right features and making sure they are properly adopted and used across the business,” says Meerson.
Having a longer-term view has resulted in changes to how the business trades on a daily basis. The influence of digital activation on all channels is closely monitored so resources can be allocated to the right drivers of traffic or conversion. As a result, promotion-driven sales and discounts have decreased and continue to do.
A year of personalisation, mobile and clienteling
Continuous improvement is at the heart of Sephora’s digital strategy with the business making around 400 changes every quarter as it adapts, adjusts and makes improvements across the omnichannel business.
Sephora’s digital flagship strategy has been one of the major stepping stones in the year, as the company furthers its advances in end-to-end omnichannel personalisation. This is enabling Sephora to improve product recommendations in store, online and via its fully-revamped mobile app. The app was rolled out across continental Europe during a three-month period and is yet to launch in the UK. It has been designed to engage consumers with self-service tools enabling them to discover and select products, as well as interact with expert beauty advisors and customer services. This app has “literally driven our growth over the past 12 months in an extraordinary way,” says Meerson.
In its stores recent digital developments include the launch of a clienteling app opening up the customer’s omnichannel journey and history to the beauty advisor. This in turn then feeds Sephora’s digital channels with the customer’s instore interactions when they next go online or use the mobile app.
The business has put a lot of focus on CRM and the requirements to delight and surprise customers. This will see the UK pioneering a new loyalty programme with the aim of increasing omnichannel engagement. The loyalty scheme will be rolled out to other markets in the future.
“By having this huge and incredible community of customers, we are now able to use data in a much more sophisticated way. And we’ve developed that over the last 12 years with the introduction of artificial intelligence, and every year making strides towards personalisation. And now we are closing the loop in the sense of offering personalisation from online to the store,” says Meerson.
Data from online, such as emails or texts that are read, interaction with customer service, search engine use is now available in store through the new tools being put in the hands of beauty advisors. This will help them recommend not only the right product based on a customer enquiry or specific need, but also the right product based on customer history ensuring the products offered are consistent in all channels.
“We’ve made a huge step forward over the last 12 months which is effectively the first step in a new approach, which is very innovative, centred on omnichannel, and bringing value to customers,” says Meerson. “It shows the business how critical it is for a customer to be both online and offline, how complementary those channels are, and it’s proving extremely efficient,” he adds.
The UK will be a test bed for other omnichannel services as the retailer continues its plan of opening additional bricks-and-mortar stores in the country. This will not be at the expense of instore experiences that consumers expect already from Sephora such as masterclasses, tutorials and tie-ins with products that are trending on social media. Sephora has found that consumers in the UK are happy to share their thoughts and feelings on innovation.
Read more about Sephora’s use of AI and its future plans in the full interview, authored by Emma Herrod, by downloading the RetailX Global Beauty 2024 Report.
In the report, we delve into the performance of the global beauty market, analysing consumer trends, purchasing behaviours, and emerging market dynamics. From skincare to cosmetics, fragrance to haircare, we examine what customers are buying and how they are shopping, both online and offline.
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