Shopping for cosmetics at Sephora is meant to be a hands-on experience. Through more than 280 stand-alone stores in North America and 300-plus locations in J. C. Penney department stores, Sephora USA takes a self-service approach to buying makeup, fragrances, and skin care products. It offers more than 200 brands of prestige products, including its own-brand products, all of which customers are encouraged to sample. The company also sells via catalog and online at Sephora.com. Part of luxury brand giant LVMH, Sephora USA is the North American retail arm of France-based Sephora, which was founded in 1969 and has a global network of about 1,200 stores. Sephora USA's first shop opened in New York in 1998.
Part of LVMH's selective retailing business, Sephora enjoyed robust sales growth and market share gains in the US and Canada in 2010 and the first half of 2011. In 2011 the beauty retailer focused on modernizing its existing US stores and growing its online business. E-commerce has been a growth driver for Sephora as a result of a dynamic promotions strategy, increased interactivity, and focus on customer service.
The chain differentiates itself from competitors (such as Ulta and The Body Shop) by emphasizing its Beauty Insider loyalty program, holding in-store events to promote selected brands, providing beauty services (including makeup lessons and express hair styling), and offering a broad array of products from popular makers (such as Bare Escentuals, Clarins, Clinique, and Shiseido) and its own Sephora Collection. Sephora's private-label items generate about 10% of sales.
Since the opening of its first mini-shop at JC Penney in 2006, the successful partnership has grown to number more than 300 locations nationwide, with a target of 600 by 2015. Indeed, rolling out Sephora mini-shops at lightning speed has become part of the department store chain's long-term strategy. – less