America Loves Ulta Beauty, Sales Increase 18% with the Help of New Store Design

Ulta Beauty continues to expand its footprint in the US market and consumers continue to support the beauty retailer, with annual sales in 2022 to exceed $10 billion, a record for the company. Profits were a record over $1 billion and Ulta Beauty
expanded its loyalty program membership to more than 40 million members. “Achieving such significant milestones reflects healthy consumer engagement with the beauty category, the strength of Ulta Beauty’s highly differentiated model, and the impact of our winning culture and exceptional teams,” CEO Dave Kimbell said on the most recent earnings call .

The company’s successful growth in sales, up 18.3% for the year, and its continued acceptance with the US market is a result of its strategic location, commitment to diverse product lines that reach a wide range of demographics and determination of keeping her finger on the client’s pulse. The company opened 247 stores last year and remodeled 20 with new floor layouts and store design. The new store layout reflects the way customers want to shop by leveraging data from Ultamate Rewards members and listening to customer and brand partner feedback.

Most stores are located in neighborhood centers close to its customer base, and the company operates more than 300 Ulta Beauty stores within Target
locations. The strategic partnership with Target includes plans to eventually have up to 800 of these stores within stores.

The new store design is welcoming and exciting

In an interview with Ulta Beauty chief merchandising officer Monica Arnaudo, it was clear that the new design came from listening to the Ultamate Beauty faithful and its many partners. The important thing about how shoppers like to explore Ulta Beauty is that they like to explore and discover products and services throughout the store. “We’ve improved the overall store navigation and increased the hierarchy of product categories to make discovery fun and easier to navigate,” said Arnaudo. Shoppers interested in bath and body care will find skin care products next to body care. Wellness products are placed close to the bath and body area, a natural flow for shoppers.

“In the new store layout, we wanted to provide an opportunity to showcase inspirational moments for shoppers,” Arnaudo said, adding that the storefront should be as exciting as entering his home. The entrance of the newly renovated stores highlights two important factors. Ulta’s Beauty’s unique beauty perspective and beauty entertainment. The front-of-store view allows Ulta Beauty specialists and partners to highlight key beauty trends and assortments across seasons. For example, conscious beauty can be a consumer trend highlighted at the front of the store or a new product launch that showcases innovative products. The entry will be based on company-wide marketing issues, but will allow stores flexibility to appeal to local market preferences.

Beautytainment adds excitement to stores

Beatytainment means creating energy and events near the front of the store. Creative activity can include the Benefit Brow Service, Mac makeup services or the Beauty Bar, a swing event space. Each store has a full-service beauty salon behind the beauty bar. “Our guests look to Ulta Beauty for inspiration, what’s new, so it’s our responsibility to showcase what we’re seeing and give guests the opportunity to experience what’s new, what’s on trend and what excites us most. Based on the survey of our rewards members, this is what they want from us,” said Arnaudo.

Following the novelty and beauty section, guests can explore skin care which has been moved near the front of the store and given more space based on continued consumer interest and emphasis in this category. “Skin care achieved the strongest growth this quarter with double-digit increases in both prestige and mass,” Kimbell said, referring to Q4 2022 revenue.

Brand partners bring the new layout to life

Pulling off such a noticeable and dramatic change in store layout is difficult when it comes to over 600 brands. However, Ulta Beauty worked with each brand to ensure the new store layouts met the design goals important to the shopper journey.

The future of Ulta Beauty

“Over the past two years, the US beauty category has experienced unprecedented growth, reflecting a variety of factors including product innovation, the expansion of treatment regimens, new social media platforms, the return to work and resumption of social activities, and increased connectivity between beauty and overall self-care. Kimbel said. Price hikes in the beauty sector contributed to revenue growth in 2022.

Ulta Beauty plans to open 25 to 30 new stores in 2023 and remodel or relocate another 20 to 30 stores. Within the next two years, the company expects to open about 100 stores. All new and refurbished stores will have the new store layout. The company is focused on buying anywhere, filling anywhere capabilities, and plans to continue accelerating growth on its digital platforms and blending physical and digital experiences. Ulta Beauty expects net sales to grow 7% to 8% in 2023.

Leave a Reply

Your email address will not be published. Required fields are marked *