2700 stores, 35 countries, top class e-commerce website, thousands of employees and revenue worthy of more than millions. This is Sephora, one of the most popular beauty brand and cosmetics retailer over the world.
Started from France, the Sephora business model is rapidly expanding. It offers several beauty products, of their own and from other high-end beauty brands making them more accessible to the users. Sephora is considered to be one of the best specialist beauty retailer center in the industry.
And it continues to grow!
Sephora business model
The Sephora business model uses the 4 Ps for marketing. They are Product, Price, Promotion, and Placement. The use of this mix allows the organization to position itself competitively and achieve its business targets. If you take a look at Sephora’s history you will find that the brand has used this strategy to succeed at a time when the industry was facing saturation.
1. Product strategy: Sephora offers a range of beauty products such as perfumes, skincare products, and other such products and services. The target audience for Sephora is young women, especially those belonging to the middle and upper-middle classes.
According to a survey, users had a lot of queries as to how many brands does Sephora carry. There is a huge product range available with the company including more than 15000 products.
Some of the Sephora cosmetics products you can get include makeup kits, fragrances, lipsticks, eyeliners, and several other kinds of products. The Sephora marketing strategy also offers other services that can be accessed freely by the customers.
There is a Beauty Insider program available that is membership-based and it allows the members to reach the products at a discounted price. The company also organizes contests and events for customers to take part in. This product strategy by Sephora helps in improving customer engagement and you can strengthen the position of the product in the market with a wide range of products.
2. Pricing strategy: Although Sephora started by concentrating more on women that were beauty conscious, they have since then ventured into men’s beauty products as well. Sephora is currently well-positioned as a qualitative and unique brand that provides good quality cosmetic products for affordable pricing.
The company concentrates on higher-end products instead of selling drugstore products. Although Sephora products can be expensive, the company does offer promotional prices for their loyal customers in the form of discounts and incentives.
3. Promotion strategy: Sephora uses various strategies for its marketing. The company firmly believes in promotional activities and they use different ways for creating awareness in the market. These strategies develop a vocal chain with the customers conveying their good experiences with their friends and family.
The company relies heavily on word-of-mouth publicity by the consumers to try and foster loyalty. They have developed an exclusive clients list over the years. They also offer tutorials to visitors, as a part of their in-store services. Sephora business model also provides tips and beauty talks to those that are interested.
There are many promotional campaigns run on social media platforms for improving awareness of the company. The business enjoys more than 17 million followers on FB and more than 2 million on Twitter. There is an official website that gives you the entire portfolio for attracting buyers.
4. Placement strategy: Sephora has its headquarters in Paris. But the company has more than 600 stores in the U.S. alone. The company firmly believes in developing a solid bonding between itself and the consumers. As a part of this, they allow the users to try out their products before buying them.
You can also get a piece of advice from skincare experts about the best products for your use. The Sephora business model improved its distribution network by partnering with JC Penny, which is a departmental store. Sephora took its products online in 1999.
Sephora entered the fulfillment wars in October 2021 with an introduction of its same-day delivery alternative. The beauty giant now offers this fast alternative as one of their preferred methods on their site and mobile app. They charge a flat $6.95 fee for this service. These orders are fulfilled from the stores located nearby by using couriers and the products are delivered directly to the consumers.
This service is available 7 days a week in some regions of the U.S. However, the orders have to be placed before 4 pm. If you place an order after 4 pm it will be delivered on the following day.
There is no requirement of a minimum amount although all their products are not available for this service. The customer can get status notifications and the retailer will recommend that the customer be present at home to receive their order. All these deliveries are contactless.
Sephora sources recently commented that when they surveyed their customers, they found that almost 50% of the clientele cited same-day-delivery to be the best option for delivery. There is also the alternative available to pay online and pick up the stuff from the store. It is also called the BOPIS method and it is available in all the stores.
As a way of improving their consumer engagement efforts, Sephora brought back their Live Beauty Help chat tool in 2021. It was earlier known as Home Chat. The function of beauty live chat is to connect the consumers with the company’s beauty advisors for providing advice about the use of their products. This has been one of Sephora success factors.
These live advisors help with things such as the selection of the right products for matching the skin tone. They can also advise about looking for the right hair care and other beauty-related items, choosing gifts, and troubleshooting problems with earlier items. This service is now available on both their mobile app and website.
How much does it cost to start a business-like Sephora online?
As various businesses have their own goals, visions, and requirements, the costs involved in developing a cosmetic shopping app-building also change. The costs involved in developing a Sephora-like app depend on some significant factors such as,
- Degree of customization.
- Features you need in the app.
- Hourly rates you will pay to the developers.
- The platform you will use for app development.
- Any integration and 3rd party plugins you will need.
If you put all these things together the costs involved in developing a skincare and cosmetic shopping app such as Sephora can be close to $30000. However, you can get confused about the actual cost due to different requirements.
Discuss your requirements with professionals. A good place to make a beginning for this is Jungleworks. They can help you out with all stages of the app development process. Let the Jungleworks professionals know about your requirements and be clear about the things you need in your beauty products app.
Using Jungleworks Hyperlocal Stack
For having an app like Sephora, you can use the Hyperlocal Stack from Jungleworks. It is exactly what you will require for managing and expanding the ordering, delivery, and marketing of your company. This single platform offers a range of features as you will have a single account with several functions. Here are some of the features you will get with Hyperlocal Stack.
- Better digital experience.
- Improved ordering experience.
- Better fleet management and dispatch.
- Intelligent mapping.
- Great route optimization.
- Systematic and smart payments.
- Centralized customer engagement.
- Great customer acquisition.
- Conversational and engaging support.
- Automated marketing campaign.
The Hyperlocal Stack will ensure that you have a personalized and unique online presence. Your customer ordering experience will be controlled by yourself. There is an endless possibility of customization due to headless commerce. You can react to the market trends faster by removing the dependency on changing the back-end architecture.
Sephora is arguably the most popular beauty retail brand in the world. This is all due to the way the company differs itself from other brands working in the beauty industry. The success achieved by Sephora shows that they are providing their customers with a unique shopping experience that is appealing to them.
They succeeded in improving brand awareness and their sales during the process. Creative marketing strategies are used for reaching out to society and turning the clientele into brand advocates. If you are looking to develop a similar platform, get in touch with the pros at Jungleworks for expert assistance.
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