Sephora ramps up store openings as it taps ‘beauty revolution’
French cosmetics chain says customer in-store experience is crucial to success
France’s Sephora is opening up to 150 stores a year as the LVMH-owned beauty and make-up retailer seeks to accelerate its global expansion and keep up with a “beauty revolution”, according to its chief executive.
“Our retail stores are thriving; they’re alive, they’re kicking,” said Sephora chief Chris de Lapuente on Tuesday in an interview at the Financial Times Business of Luxury Summit in Madrid. “We’re opening between 125 and 150 stores every year, and we’re constantly renovating our biggest and best stores.”
Sephora’s investment in physical stores underscores the key role it sees for bricks-and-mortar outlets to engage with customers, as part of an “omnichannel” approach that includes ecommerce and building an online community through social media. The regions that will have the most new stores are North America and Asia; and growth in China is forecast to double in the next few years.
“What matters to us is to build wonderful relationships with our customers and the store is the place where these relationships are created and nurtured,” said Mr de Lapuente. “Experiential retail is very much part of Sephora’s DNA and we will continue investing in it.”
Sephora has enjoyed strong growth in the past few years on the back of soaring demand for cosmetics beauty products that has also benefited big brands such as L’Oréal and Estée Lauder.
LVMH does not break out Sephora’s performance in its results, but last year organic sales in the “selective retailing” division that Sephora is part of rose 12 per cent to €13.65bn (excluding the closure of Hong Kong airport concessions in 2017).
“It’s an extraordinarily dynamic market,” said Mr de Lapuente, a former longtime Procter & Gamble executive who became Sephora’s chief in 2011. “We’re living in a beauty revolution.”
On Friday a Sephora store will open on Times Square in New York, its largest in the country. Last week Sephora reopened its second-largest store in France, in the Paris business district of La Défense, after a major renovation. It is due to reopen its largest store in the world, at the Dubai Mall, on Thursday following an extensive overhaul.
Sephora stocks about 300 brands, including its own private label, in 34 countries. It has 2,500 stores worldwide and employs 40,000 people.
Mr de Lapuente said that, for Sephora, “experiential” retail meant that “when customers come into the stores they have a wonderful experience”.
He added: “I don’t mind if the customer doesn’t buy today, what I care deeply about is that they love their experience in Sephora [ . . .] if they walk out of the store with a smile on their face feeling like they’ve been listened to, they’ve discovered something, they’ve had a wonderful experience, they’ll come back and they’ll buy something next time.”
Ecommerce represents an average of 20 per cent sales in each country, although this can be as high as 30 per cent in some countries and as low as 5 per cent in others, said Mr de Lapuente. Customers who buy both online and offline tend to purchase three times more than those who buy in just one channel, he added.