In the heart of the Silicon Valley, the Sephora Innovation Lab thrives on a culture of innovation and collaboration, disrupting the beauty retail industry. We explore what makes their customer experience so unique, and why you should be as obsessed with your customer as Sephora is.
You have to be hard-pressed to find someone who is not familiar with Sephora in 2019.
The French multinational beauty giant is famous for its selection of over 250 beauty brands, its devoted fan-base, and its little black bags – and the fact that they generate over $4 billion in revenue a year. For years, they have been disrupting the beauty industry, offering a customer experience that is both innovative and unique. So what makes Sephora’s strategy so successful?
Sephora uses its innovation lab to remain a “customer pioneer” – a focus that runs strong in the retailer’s DNA. From the moment when Sephora developed what is now a common-place “try-before-you-buy” concept in the beauty industry, the retailer has been obsessive about keeping the customer at the heart of every experience.
Part of that obsession, especially when retailers are chasing the omnichannel dream, is understanding their customers deeply enough to know when they are ready for innovation.
For example, the Sephora “To Go” app was fairly basic when launched initially in 2010. Video and product scanning didn’t gain traction until a few years later because shopping centres did not have Wi-Fi or lacked mobile signals, and customers had limited data plans. Sephora recognised that rolling out these features would be ineffective as they required internet access to work effectively. Now, most areas have Wi-Fi and customers are used to watching video on the go, which meant the audience and market infrastructure was ready once Sephora decided to roll these features out after the initial app launch.
At a time when marketers are constantly looking at ways to solve customers’ needs, even when frequent launches make for a chaotic customer-brand relationship, Sephora practices patience and aims for seamless customer adoption. There’s a skill in creating an evolving customer experience while not bombarding customers with unnecessary new widgets.
Is Your Customer Ready?
While there is a new digital innovation every day, the key questions Sephora would have its digital marketers ask themselves are:
- Is the infrastructure ready?
- Is the audience ready?
Johnna Marcus, senior director of Sephora’s Innovation Lab told L2, “more often than not when we run into things we want to shelve, it’s because of timing. The technology is not there yet or the user is not there yet. Some combination hasn’t taken off yet.”
In some cases, Sephora has noticed a technology itself may not be up for adoption, such as augmented reality (AR). Four years after AR became more mainstream, Sephora launched its Visual Artist app which helps customers try on various lipsticks on their mobile screen. The reason for the delay? The technology was there but the quality and implementation was lacking. Only after continuous tracking audiences’ reactions towards it did Sephora make its move.
As Mary Beth Laughton, EVP of Omni Retail, said: "it's about being open to new ideas, and working with partners to develop the right solutions – and being willing to do things that maybe our clients don't even know they want yet. Every digital product or tool or experience that we introduce is done to make shopping for our consumer more fun and more efficient – to help engage, educate and entertain her."
The takeaway message for the beauty retail industry is that whichever digital project they intend to invest in, customer needs, behaviours, preferences and expectations must be understood. Sephora has successfully kept user experience at the heart of their tech innovation and showcased how digitising services in the name of tech innovation shouldn’t take precedence over the customer’s needs.
The Way Forward
Experience and tech together, will continue to drive the beauty industry. But the only way other retailers will be able to imitate Sephora’s new holistic beauty experience is by bringing their online and offline retail departments together and knowing the right time to release an innovation.
For brands that have built a reputation as digital pioneers the appetite to lead won’t go away. For the rest, there’s a choice to be made between switching up the digital capability and curiosity of the organisation to be more customer centric or running the risk of always lagging behind the likes of Sephora and other digital innovators.
To find out how Circus Street has empowered beauty brands to help them enhance the customer journey, see our testimonials page. Or sign up to a free trial of our lessons to see how we can help drive the digital capability of your own team.
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