What’s Next: The personalized beauty shopping experience

When you think of the “personal touch” in an in-store shopping experience, it may conjure an image of fawning sales ladies anticipating your every desire. Personalized shopping in the technology-driven age means something quite different. Millennials aren’t necessarily looking for an attentive sales person to befriend them and offer suggestions — in fact it’s quite the opposite. A new survey from Mintel indicated that 45% of beauty consumers prefer to search for product information in-store on their mobile device. The same survey said that 39% have used or would try doing research on a store-provided tablet. There’s a clear indication towards technology as a way for consumers to create their own personalized experience.

Kurt Jetta, CEO of TABS Analytics, believed that the beauty channel has the best chance in drug and mass market for enticing millennial buyers. The challenge is that they will have to compete with specialty channels like Sephora and Ulta to do so, and those channels had the highest cosmetics penetration growth in 2015 with 41% for Ulta and 25% for Sephora, but only 11% for Target and 6% for Walgreens, according to research from TABS.

Sephora is way ahead of the game with the rollout of their new initiative — Learn. Inspire. Play. It is a digital concept store that recently launched with a test store in San Francisco. This ambitious project features digital stations for communal tutorials, virtual cosmetic try-ons and a host of other tech-related experiences.

At the end of October 2015, Sephora also launched Sephora FLASH in France in conjunction with Worldline. “Sephora FLASH was developed in order to create a deep link between the digital and physical world,” Julien Decoster, business development manager for Worldline, said. “In a smaller store than the usual one, you will be able to shop the whole catalog of Sephora thanks to digital devices. It’s also a new customer experience since you’re doing an online order in a physical way: You can test the product, you can interact with the seller, you have all the advice that you need, you pay in store, but you don’t have your product immediately. It will be delivered at home, or you can come back the day after to retrieve it.”

“For each market, we know that the challenge of tomorrow is to create a personalized experience, and it’s even more true for cosmetics,” Decoster explained. “Today we have all the technology to know exactly what you’re used to purchasing, what kind of brands you like, what color is the most convenient for you. Brands just need to fill the gap between the digital and physical world, to have the perfect seamless journey. We’re able today to deliver the best of the digital services — all detailed information, an incredible choice (thousands of products), with videos, with high-quality pictures — combined with the best of a physical store —advice from the seller, testing the product, smelling fragrances etc. The main concern will be logistics, and the needed time for delivery.”

Could these types of initiatives translate to a drug or mass market retail environment? Digital kiosks have been attempted at the drug store level before, but they had limited function and were not engaging to consumers. However, in-store digital offerings that are more exploratory could be more appealing. Jetta is all for marketing that is informative and allows consumers to explore new trends, but he is somewhat skeptical of the idea. “They have to be extremely creative in their engagement strategy because of two competing constraints that beauty retailers don’t have to deal with:  1) Low overall traffic per store, [and] 2) Competing objectives from other sectors, primarily consumer health,” Jetta said.

“Beauty really is their opportunity to leverage their massive investments in their loyalty marketing database,” he said.  “Further, they will need to engage primarily in-store not passively (meaning waiting for people to come in), but actively (entice consumers into the store for specific events so that there is some efficiency in their efforts).  Digital can certainly enhance the experience, but it seems that there is still a human element of the engagement that needs to be considered.”

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