Sephora Case Study

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- Beauty Insider program:

Beauty insider program focuses on introducing customer relationship management build around perks. The customers are rewarded for loyalty by offering points for every purchase and options to redeem them. Along with birthday bonuses and easy sign-ups for the beauty insid er program, it also coined the term of VIBs who spent more than 350$ via Sephora offline or online. VIB were given special invites, deluxe gifts and early access to products. Approximately 80% of Sephora’s sales came from beauty insiders.

The communication platform used to send weekly alerts promotions and sign ups was via e-mail which made it low cost platform yet effective.

- 4.2 Sephora Direct – Social Media

- 4.2.1 Ratings & Reviews:

Enabling users to post product ratings and reviews on Sephora was a challenging decision, there were internal concerns about the negative reviews. However, enabling to do so opened a forum for two-way communication between Sephora and its consumers. Most consumers want to appreciate the quality of the product they use and this serves as a very important platform. The feedbacks posted are screened through basic electronic screening for inappropriate language and then are posted on the website. With an average rating of 4.2 put of 5, this platform was a success as the consumers are eager to converse with each other as well as with Sephora itself.

- 4.2.2 Facebook:

With the growing trend of online networking, surfing and shopping, facebook has become the largest and fastest growing social media site. The Sephora ‘facebook fan page’ encouraged the consumers to directly speak to Sephora. Sephora took help from Call center support team and set up responses to the same. Facebook also helps fellow VIBs and super users to respond to each other and are occasionally surprised with gifts for their contribution by Sephora. It is another media platform that helps to run promotional offers at a large scale affecting not the consumers or followers but their second connections as well. The promotions spread virally to friends and relatives like sweepstakes for “Sephora claus” which ran in 2009 holiday season. However, it is critical to monitor the page and respond real –time to avoid lagging.

- 4.2.3 Beauty Talk:

Beauty talk differs in a way from facebook that the questions are not redundant as there are search options available for similar posts. Anonymity to ask questions by beauty experts or from fellow users is another advantage of beauty talk. The Q & A forum encourages the super users to respond and are easy to track thanks to the 35-level leader board and the various sign symbols attached to each user based on their level of activity. However, one of the biggest challenge is to find a balance between clients sharing their own experiences versus Sephora expert which could be perceived as bias. Another challenge is to blend it with the facebook site to avoid users to hassle between two sites, or a choice to move the clients from one medium to another.

- 4.2.4 Twitter:

The latest trend of 140 characters caught up with Sephora as well with #Sephora. Sephora tends to use twitter to spread news, promotions an event alerts. Twitter allows users to voice their purchases, views, new promotions, products or simply share their thoughts in relation to Sephora. This helps spread brand awareness for the users following the client tweeting about #Sephora.

- 4.3 ONLINE VIDEO – YOUTUBE

- The official channel of Sephora has created around 3 million views for over 100 videos. These videos are the ones that are made and invested by Sephora itself. Creating a video requires investing costing $20,000 each and yet there is no trendsetter of it going viral. This makes the investment risky, but if the video does go viral it generates a lot of publicity and helps of conversion from viewers to buyers. There are many user generated content video that maybe using Sephora products in their videos for make up or recommendations or in a different context, an attempt to collaborate these videos the official website of Sephora should be made.

- 4.4 SEPHORA DIRECT – MOBILE

- Sephora optimized its website for mobile users making it user friendly using WAP – wireless application protocol. This helped the customer the view the official website on the smartphone – smaller screen in its mobile format making it much more convenient and easier.

- Sephora also launched its app as an app enables faster performance and GPS functionality while using a camera. The Sephora App is an Ios – only application that is promoted via the website when accessed through phones as well as the visual displays in shops. It is user friendly and the best features include the shopping, past recorded purchases for re – buying or recommendation, new products, today’s obsession, ratings and reviews, beauty advice, beauty insider, product history, product reviews, bar – code scanner.

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- Sephora faces too much competition as a lot of players offline, online, retail, departmental are part of the market that Sephora operates in. This makes customer loyalty difficult as they have many options to choose from.

- The pricing strategy for Sephora does not account for discounted products and therefore do not constituent as the most economic price available in the market. Similar products and at times same products could be available at different store for a lesser price.

- Although Sephora has a good number of stores and targets customers for its brand recognition, it lacks the recognition in non–metropolitan areas. The customers in suburban base are not aware of Sephora due to lack of Physical store or traditional marketing campaigns like print ads or television ads. Thus, a segment of customer base is missing from its target demographic. For consumers when the store is not within limits, they prefer to shop online, however the unaware customers would not avail the online services either.

- The launch of App by Sephora was a huge success, however targeting only I phone users shows more a discrimination rather than strategic research. The Brand should foster uniqueness yet standardized for any category of its target consumers. Differentiating the app for its I phone users