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Table of contents

Hadeel Nassar
Professor Haworth

MKT 3320.002

BRAND AUDIT
Sephora

Table of Contents
Brand Inventory
Part I
Company4
Category and
Competition.8
Products Within Category for your
Brand.11
Part II
Brand Analysis for your Brand
13
Consumer Profile for your
Brand14
Advertising/Marketing Communications for your
brand....17
Media for your
brand..18
Promotions for your
brand..19
Digital Strategies for your
brand.20
Other Pertinent Information
22
Discuss their brand value and whether it has increased or decreased this
year..23

Brand Exploratory
Part III
Qualitative
Research..24
Quantitative
Research26
Recommendations
..28
4

Comp
any

Location:

Sephora headquarters are located in San Francisco, California with corporate


offices in New York and Montreal. Sephora operates approximately 1,900
stores in 29 countries worldwide, with an expanding base of over 360 stores
across North America.

Organization, Subsidiaries and Major activities:

Sephora is a beauty-retail concept founded in France by Dominique


Mandonnaud in 1970. Sephora's unique, open-sell environment features an
ever-increasing amount of classic and emerging brands across a broad range
of product categories including skincare, color, fragrance, body, smile care,
and haircare, and in addition to Sephora's own private label. It is the leading
chain of perfume and cosmetics around the world.
Sephora developed "Science of Sephora." This program was created to
ensure that all workers working for Sephora skilled to identify skin types. the
history of makeup, application techniques, the science of creating
fragrances, and how to interact with Sephora's clients.
Sephora opened its first U.S. store in New York in 1998.
Sephora.com launched in the U.S. in 1999, the foremost beauty site on the
Internet.
In 2006, Jcpenny began opening Sephora inside JCpenny stores.
In 2007, Sephora launched a client loyalty program as a way of thanking
clients with special products, exclusive information, and gifts.

Brand history:

Sephora has a brand value of $2,418m.


Sephora started out as a small perfumery in Limoges, France, called Shop 8.
Dominique Mandonnaud wanted to provide a place for customers to try out
the products before making a purchase, something almost unheard of at the
time. Products were grouped together by type, not brand.
Sephora Begins in 1970: The UK's Boots PLC chain, which became the 38
Sephora-branded stores Mandonnaud would later purchase, began in Paris.
This group of stores partnered with a department store group, Nouvelles
Galeries. Unfortunately, these stores were not very profitable.
Shop 8 and Sephora Combine 1993: Mandonnaud purchased the Sephora
chain in 1993.
Sephora's Brand Launched 1995: In 1995, Sephora company history reports
that it launched a brand of its own name.
Sephora opened their first store in the United States in New York City in
1998. Today, there are more than 250 stand-alone stores in the United
States.

Financial Data:

Annual report:

Key personnel:
7

Sephora Executives:
Calvin McDonald, President and CEO.
Mary Herald, Executive Vice President of Human Resources and Education
Satish Malhotra, Executive Vice President, Latin America, Canada and
Sephora inside JCPenney
Alexis Rollier, Chief Financial Officer and Senior Vice President of Finance
and Operations
Christie Jack, Senior Vice President of Retail
Mary Beth Laughton, Senior Vice President of eCommerce and Digital
Marketing
Deborah Yeh, Senior Vice President of Marketing and Brand
Philippe Pinatel, Senior Vice President and Country Manager Sephora
Canada
Artemis Patrick, Senior Vice President of Merchandising
Savio Thattil, Chief Information Officer and Senior Vice President of
Technology
Mike Racer, Senior Vice President of Supply Chain

Recent news:

Cosmetics Giant Sephora Plans to Survive Retail in a Digital Age: Color IQ


matches shoppers skin tone with the appropriate shade of foundation. It also
provides the company with valuable data about its clients.
When Sephora began using Color IQ in stores, the company quickly realized
that some of the 121 skin tones identified were more popular than others,
and yet, Sephora didnt have a very extensive product offering for several of
the most popular tones. Using this Color IQ data, Sephora worked with
brands to build out a more diverse range of shades, and since then, the
company has added a whopping 2,900 SKUs to its inventory.

Category and Competition

Category definition:

Sephora is in the cosmetics category. Sephora is a leading chain of cosmetics


stores that carries over 250 brands. Their target customers are fashionconscious women who have active lifestyles and are seeking for a unique
look

size of category:

Sephora sells a lot of products. The size of the category is huge and it keeps
on growing. It also includes a lot of different brands such as
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history of category:

Civilizations have used forms of cosmetics, though not always recognizable


to cosmetics users today, for centuries in religious rituals, to enhance
beauty, and to promote good health. Cosmetic usage throughout history can
be indicative of a civilization's practical concerns, such as protection from the
sun; class system; or of its conventions of beauty.

10

Methods of distribution:
Online and in Sephora stores

Major players:

There are a lot of major players in the cosmetics world. Sephora have major
competitors such as Mac, Ulta, and Lo Real.

11

Seasonal factors:

There is no specific season but around holidays, they let out a lot of gift
bundles (limited edition).
Regional factors:
All over the world.
Legal considerations:
Sephora is being sued for racial discrimination: Sephora has gotten itself into
hot water in the wake of a 20 percent off sale in early November that wound
up crashing its site. Four women of Chinese descent have filed a class action
suit against the beauty retailer and LVMH, its parent company, for
discriminating against minority customers.

Products within Category for


your Brand
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Makeup

Share of category by product:


Product-form description:

Consist of eyeshadow, lipsticks, powder, foundation, eyeliner, mascara,


blush, bronzer, concealer and brushes.

New product introductions:

Sephora has new products coming out almost every month. Every product is
unique and does something different.

Benefits and appeals of new product:

Every new product that comes out comes in a new package with an
appealing design and glossy touch to attract consumers into buying the
product. Also the product is advertised everywhere and shows how this
product is better than the one before or its competitors.

New packages:

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Sephora has new packages and gift sets almost every month. They have
different packages; makeup, perfumes, hair and face products for men and
women.

Innovations:

Sephora is proud to announce the launch of Beauty Board, an exciting new


social shopping platform to engage clients through beauty images and allow
them to post, share, browse and shop Sephoras photo gallery directly
on Sephora.com, the mobile site, iPhone and Android apps. Clients will be
able to upload photos, tag the products they use, and give helpful tips on
how they achieved the look.

Recent news about product category (competitors):

Mac is involving a lot of celebrities in their new products line which increases
the competition in the makeup world: MAC Cosmetics has announced its
latest inspiration, and it's none other than Selena! The beauty brand is set to
launch a capsule collection inspired by the late Latina songstress in 2016.
Also, Miley Cyrus for MAC Viva Glam, she is the face of Viva Glam introducing
two new shades. The Lipstick: dubbed Viva Glam Miley Cyrus 2 which is a
brilliant orange, while the lip-gloss, with the same name, is a matching
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orange with pearlescent finish.

Brand Analysis for your Brand

Top brands by dollar or unit sales:

Sephoras sales in North America are estimated to be more than $2 billion.

Growth trends of top brands:

Sephora has attracted a younger consumer than the department stores by


offering new and modern brands. Sephora employees focus on color,
fragrances and skin care and effectively cross-sell products. In fragrances,
products are arranged alphabetically at Sephora while department stores are
organized by brands that are less identifiable by todays consumer today.

Sephora top 10 fragrances:


1 Invictus by Paco Rabanne
2 La Petite Robe Noire EDP by Guerlain
3 La Vie est Belle EDP by Lancme
4 JAdore EDP by Dior
5 Shalimar by Guerlain (boosted by sales price)
6 1 Million EDT for men by Paco Rabanne
7 Flowerbomb EDP by Viktor & Rolf
8 Si by Giorgio Armani
9 Le Mle EDT by Jean Paul Gaultier
10 Boss Bottled EDT by Hugo Boss

Best sellers (order does not matter)


Make Up Forever Ultra HD invisible cover foundation
Becca shimmering skin perfector
Laura Mercier Translucent loose setting powder
NARS Radiant Creamy Concealer
Anastasia Beverly Hills Brow Wiz
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Category share by country and by region:

Sephora has more than 20% share of the cosmetic and fragrance market in
the United States.

Pricing trends:

Sephora products are more at the high end spectrum. It has a smaller
number of products, but with a higher average price point, in both mall and
inside JCPenny locations.

Recent news about competitor brands:

LOral announces its ambition to become a "carbon balanced" company by


2020. Through its sustainable sourcing projects, the Group aims to generate
carbon gains corresponding to the amount of greenhouse gas emissions
linked to its activities.

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Consumer Profile for your


Brand

Demographic of users:

Sephora targets women in their 20s, 30s, and 40s who want an interactive
and educational experience when buying makeup. The segment of women
attracted to Sephora would be women who value fashionable/quality
skincare, beauty, and fragrance products and are open to a medium to high
price range. Also, there are product sections with richly decorated cosmetics
that would appeal to young girls (pre-teen to teenager). The black and white
colors of the store give a look attractive to professionals. The wide
assortment of brands, vendor exclusives, and private label combinations
would attract any shoppers looking for variety

Frequency of purchase/usage:

Frequency of purchase differs greatly among what type of shopper. Heavy


shoppers may go a few times a year and some shoppers may rarely buy from
Sephora.
Sephora rewards their frequent shoppers. Anyone can become a Beauty
Insider to rack up points ($1 = 1 point) that can go toward 100-point, 250point or 500-point gifts of free stuff.
Also, customers who spend $350 annually reach VIB status (Very Important
Beauty Insider). This mostly gets you a free makeover and invitations to instore events.
Every shopper is supposed to leave with samples of something new,
something they havent used before and want to try, a former employee
told Buzz feed.

Online or in stores

Place of purchase:

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Heavy-user profile:

Mainly women in their 30s.


Frequent Sephora customers can get the VIB (Very Important Beauty Insider)
when they spend $350 at Sephora in one calendar year (January-December).
The perks include this coupon- GIFTVIB, they can get to shop sales first, get
advice and recommendations from their hotline, try new products early, and
they get 1 free makeover.
Also, there is the VIB Rouge which is for those big ballers who spend $1,000
or more in one calendar year. They get invited to free events, are the first
ones that get access to the sales, free shipping on every order, free
makeovers, and an on call beauty concierge. There are some VIB Rouge
exclusive products (a Bite Beauty lipstick, a Smashbox eyeshadow palette,
etc.) that only Rouges can purchase.

Awareness and attitude:

Like many retailers, Sephora is working on what to do with a Facebook "like."


The beauty retailer's solution comes in the form of a special weekly
promotion that fans of its page learn about first through their Facebook
feeds. Called "Fan Fridays," the promotion works to boost the retailer's brand
awareness as well as drive e-commerce traffic and sales.

Decision makers vs. purchaser:

The decision maker is the woman and the purchaser is the woman.

Sephora always follows the trends set by top fashion designers. They
provide one-stop shopping for makeup, skin care and beauty products and
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also carry over 250 brands and including their own private label, so it's easy
for consumer to fulfill their Need Recognition requirements.
Stores also offer knowledgeable staff who, not only sell products to
customers, but can also serve as advisers to them. These personnel give
valuable information to assist customers with their Evaluation of Alternatives.
They offer customers free samples, and let the customers try these products
before they buy them. Whether they like this product or not, staff are trained
to stay very patient with customers. They will introduce more than three
product brands, customers will evaluate these different products, and then
make a purchase decision. Staff will also provide invaluable feedback and
information to the customer about the different brands the customer is
considering. This will help customers make the Purchase Decision.
Sephora is known for their lifetime return policy. If you purchase a particular
brand and if a certain location does not carry that brand, they will still accept
the product (originally purchased at a different location) under their return
policy. This will help customers feel more secure during the Purchase
Evaluation phase. Either they are happy with the product, or they have
alternatives to fix the problem.

Normal purchase cycle:

Most definitions speak of the sales cycle being the time between making the
first touch point and closing the deal. The sales cycle encompasses
marketing efforts to generate and maintain interest, along with the selling
process to engage and convert into customers

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Prospects dont just enter at the top of the funnel; instead, they come in at
any stage, jump stages, stay in a stage indefinitely, or move back and forth
between them.

Brand loyalty/switching:

Sephora have a customer loyalty program, complete with the little card and
reward points. Each get you special discounts and coupons, and the points
can be redeemed for either cash off your purchase or product samples.
Sephora has a lot of product samples. with this in mind, Sephora fans will
always stay with their store b/c they either want variety and value.

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Advertising Communication for


your Brand

Creative strategies of your top brands:

Sephora goes big with its content marketing. The upscale French brand
pushes beauty tutorials through videos, blog posts, and social media
updates. Theres even a recently launched app all about how to contour,
which lets users upload a photo of themselves in order to determine how
best to emphasize their face shape. The beauty board on the Sephora
website, set up like a shoppable Pinterest page, gives makeup addicts the
chance to post their own photos and show off their favorite looks, getting the
users invested in the brand. For Sephora, its all about creating a
personalized experience.

Specific promises, appeals, claims, and special


effects.

The brand promise is to deliver high quality wide variety of products to


customers along with creative solutions in store.
The brand appeals to anyone who relishes his or her individuality and dares
to express it. Known for its daring shade names, slick design and hi-tech
hard-working products.
Claims: Contrarily to what it might seem like, theres a wide selection of
cruelty-free makeup brands at Sephora, and some of them are even certified
by the Leaping Bunny. Those that arent can be found on PETA, and Ive
personally verified their animal testing policies by e-mail to make sure
theyre truly cruelty-free and dont sell their products in mainland China.
Skincare Sephora brands that dont test on animals, on the other hand, are
sparse, but they include Ren, Murad, and Tata Harper.
The Sephora makeup brand itself is NOT cruelty-free. Sephora doesnt test on
animals except when required by law, and their products are being sold in
China, where animal testing is required by law.
Sephora introduced a new collection that will include a very exciting
Divergent Multi-Piece Collectors Kit as well as a Sephora Divergent 7 Piece
Nail Art Kit as well as other products inspired by the characters in the film.

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Sephoras Divergent Collection is housed in a distinctive packaging adorned


with imagery inspired by the film and its characters. Each product has been
specifically formulated to bring out your most adventurous side and includes
never been seen before transforming special effects for eyes and nails.

Examples of your past and current executions; info


on competitive brands

An advertisement in 2004
Advertisement in 2014

VS.

Media for your Brand

Category and brand spending:

This information can be found in annual report and financial report provided
above.

Seasonality:

Regionality:

All seasons.
All regions.

Media employed by top brands:

Billboards, TV commercials, magazines, social media, blogs.

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Continuous

Spending patterns:

Spending compared with market share; competitor


spending:

In the recent year, Sephora has had a marketing push to advertise its new
pricing model as well as the new products added such as the new brands.
This has taken a large amount of money to push through, especially
compared to the competition.

Promotions for your Brand

Promotions used in category:

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Major brand promotion types and examples:

All mentioned in the category above.

Success rates of promotions; competitor


promotions:

Promotions are very successful and customers are very happy with the
promotions and deals that Sephora offers. However, Sephora does not have
a lot of coupons for in store shoppers.

Digital Strategies for your Brand

Website, purpose of site:

Sephora has an excellent website, sephora.com, that the entire world can
easily access. At the Sephora website, customers are able to place online
orders and search for the merchandise they want. They are also able to be
informed of any changes in the company and other information they post on
the website. It is used to promote the Sephora products and help drive sales.

Ecommerce activities:

On Sephoras website consumers actually can have free shipping for orders
greater than a certain amount. Consumers can order almost any item they
want and can choose to pick it up in any store at any cash register.

Social media activities:

Sephora utilizes social media portal such as Facebook and twitter to update
consumers about new products and news releases that are currently
happening around the world in Sephora stores. It is used to promote the
sharing of ideas and any other customer wants and grievances in a quick,
free, and easy way. It is effective in promoting the brand.

SEO:

Sephora uses SEO and Keyword forecasting that helps marketers predict
keyword-to-content value to find potential customers, create smarter content
and predict return on investment.
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Marketing agency PM Digital released a report last week that revealed


beauty brands should be investing in search engines as 40% of clicks to
makeup and skincare sites because they were driven by search engines. Of
all search engines, Google was the highest driver of traffic, accounting for
30% of referrals to makeup and skincare sites.

market automation efforts

Sephora uses Neolane which is a marketing automation solution used by


B2B/B2C enterprise marketing organizations. Neolane can be deployed on
premise or hosted at the vendors data center. This system offers a breadth
of functionality to help marketers execute across traditional and modern
channels including direct mail, email and mobile. It helps marketers manage
campaigns, resources, customer data, and analytics from a single, open
platform created entirely by Neolane.

Attach Hootsuite Dashboard

Provide extensive section on social media strategy;


Do the executions properly support the brand?

Sephora uses many social media strategies such as Facebook, twitter,


Instagram and many more.
This month, Sephoras been posting on Twitter the most. August 8th was
their most active date, which you cant necessarily tell just by looking at
their timeline sans replies. Thats because Sephora spent a lot of time on this
date responding to customers on Twitter.

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The executions support the brand and are clear.

Other Pertinent Information

Personal interviews, other information sources

I conduced a phone interview with Sephora store manager Kimberly


Lyn.
Hadeel Nassar: What do you feel is the main struggle with the
Sephora brand?
Kimberly Lyn: I think there is definitely struggle with the customers
acclimating to the numerous changes that have happened to Sephora
and all the new brands added in the last year. There have been
changes in management, pricing, and overall structure of the
company.
Hadeel Nassar: What do you like or like about Sephora
advertisements?
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Kimberly Lyn: Sephora advertisement are a good fit to a good theme.


The advertisements compliment Sephoras logo and its mainly in the
same colors which are black and white. The colors of our ads are
powerful and give women a sense of power and leadership.
Hadeel Nassar: Where do you see Sephora in a few years?
Kimberly Lyn: Now that we are opening Sephora stores all over the
world, its becoming a unique shopping experience that the customers
are happy with. If we continue to give outstanding customer service,
then we should do well in the future. Sephora has spent a lot of money
marketing itself. I also see Sephora marketing a lot more to the
younger teenage generation, so its great to have all ages come in and
shop.

Brand Value
A. Discuss their brand value and whether it has increased or
decreased this year.
Sephora brand value is shown

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Sephora has a brand value of 2,418,000 million which has increased


over the years. Their sales and market share has also increased as well.
Sephoras is adding new brands and products every year that helps
increase their sales and brand equity. Also, big brands are being added to
Sephora such as the Hudabeauty lashes which is creating more brand
equity for Sephora and increases the brand value,

Brand Exploratory
Qualitative Research
Brand Magnitude
For the qualitative research I used howsociable.com to measure
Sephoras brand magnitude through social media against
Sephoras competitors such as Mac and Ulta.
Sephoras magnitude from November 2nd to 9th is 5.7. On the
other hand, Mac magnitude is 6.1 and Ulta is 6.2. Sephoras
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magnitude is lower than its competitors. Mac and Ulta are more
involved on social media especially on Linkedln and YoutTube.

Word Association
Based on Wordle.net, Sephora is associated with all these words
in the picture bellow. According to the website Sephora is tied
with everything that deals with makeup. Also, since Sephora is a
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store, people associate it with other different brands such as Nars,


YSL, Tarte, and Naked.

Quantitative Research
I conducted a survey that test peoples brand awareness of
Sephora and their ability to recognize the brand amongst other
makeup brands. I asked 16 people four questions about the brand
strength, uniqueness and favorability. I gave the survey to my
friends, family, and co-workers. I added all the results in a table,
these results will help me analysis how people recognize
Sephoras brand.
The five brands:

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Survey Questions:
1) Which brands can you recognize?
2) Put the brands in order of their strength.
3) Put the brands in order of your favorability.
4) Put the brands in order of their uniqueness.

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Results:

Farrah
Sarah

Q1:

Q2:

Q3: Put

Q4: Put

Which
brands
can
you
recogni
ze?

Put
the
brand
s in
order
of
their
stren
gth.

the
brands
in order
of your
favorabil
ity.

the
brands
in order
of their
uniquen
ess.

1,2,3,4,
5
1,3,5

1,4,5,3
,2
1,5,4,2
,3
3,1,4,5
,2
4,5,1,3
,2
3,1,4,5
,2
2,1,4,5
,3
4,5,1,2
,3
1,3,5,4
,2
5,4,3,1
,2
1,4,3,2
,5
1,5,4,3
,2
4,5,1,3
,2
3,2,1,4
,5
5,1,4,2

3,1,2,4,5

1,4, 5, 3,2

1,5,4,3,2

3,1,4,5,2

1, 5, 3, 2,
4
5, 4, 1,
3,2
3, 5, 2,
1,4
2,4, 3,1,5

2,1,5,3,4

4,5,1,2,3

1,2,5,4,3

1,3,2,4,5

3,5,4,1,2

3,1,4,5,2

1,3,4,5,2

1,4,5,3,2

5,1,4,3,2

2,5,3,4,1

4,5,1,3,2

3,4,5,1,2

3,1,4,5,2

1,4,5,2,3

1,2,4,5,3

2,3,1,4,5

4,5,3,2,1

1,5,4,3,2

Moham
med
Ali

2,3,5

Khaled

2,3,4

Essam

4,5

Tareq

1,5

Wafa

3,4

Osama

1,3,4,5

Mayss

2,4,5

Abeer

2,3,4,5

Hibah

1,3,4,5

Su

2,3,4

Sam

1,3,5

1,3,5

2,1,4,5,3
4,3,5,2,1

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Emily
Brenda

1,2,3,4,
5
1,2,3,4,
5

,3
4,1,5,3 1,4,5,2,3
,2
3,5,1,4 4,5,3,2,1
,2

1,4,5,2,3
4,5,2,1,3

Based on the survey, Sephoras logo is most recognized amongst the other
makeup brands but is not seen as unique. Some of the people I surveyed
picked Sephora as their favorite brand because the other brands costed
higher. Sephora is not as strong as the other brands but it does have a price
advantage. Since Sephoras logo is recognized, they need to work more on
being unique and increasing their strength.

Recommendations
During the years, Sephora has increased their brand value and brand equity.
They became a favorable product among other makeup brands by offering
convenient and fairly priced products. Overall, Sephora has done a good job
building their brand equity, although, they have a lower involvement on
social media than other makeup brands. Sephora should take advantage of
social media by advertising their brand, and they should engage customers
more and increase the brands magnitude.
The large success of the company is due to their professional adverting and
well known products. However, there are many things that Sephora should
work on to increase their strength and uniqueness. Sephora can do a better
job using social media and getting their brand out there. Sephora does not
engage their customers, but if they did they could increase their brand
awareness because people will remember the brand better if they are a part
of it.

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In order to beat their main competitors that include Mac, Ulta, and
Loreal they must build a relationship with their customers. There needs to be
wiser allocation of money spent on marketing. Sephora needs to start
thinking of new ways to increase loyal customers and build their strength.
Some new possible brand extensions and innovated ideas for Sephora
can be:

Sephoras brand is associated with a lack of corporate social


responsibility. Sephora should consider adapting a social responsibility
because it will improve brand considerably. In return, brand equity will be
built, and consumer goodwill and perception of the brand will be
strengthened.

Sephora can create a mobile application that notifies customers of new


brands and new makeup launching at the store. Also notify them of any
holiday specials and good deals.

Sephora can increase customer engagement by creating makeup


contests of different holidays such as Halloween using all of Sephora makeup
and have rewards.

Sephora should sponsor some women sport events, they can


communicate to a large population from all over the world.
By doing these tasks, brand awareness and brand image will be much more
positive and ultimately Sephora may attain its goal of becoming Americas
favorite makeup store.

Works Cited
HowSociable. (n.d.). Retrieved November 10, 2015, from
http://howsociable.com/sephora
Sephora Introduces Divergent Cosmetics Collection. (2014, February 25).
Retrieved November 10, 2015, from
http://www.musingsofamuse.com/2014/02/sephora-introduces-divergentcosmetics-collection.html

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Tag Archives: Sephora. (n.d.). Retrieved November 10, 2015, from


http://www.l2inc.com/tag/sephora/page/5
Sephora Snags Beauty Sales with Pinterest - ZOG Digital Blog. (2013, May
20). Retrieved November 10, 2015, from
http://blog.zogdigital.com/2013/05/20/sephora-snags-beauty-sales-withpinterest/
SEPHORA. (n.d.). Retrieved November 10, 2015, from
http://brandirectory.com/profile/SEPHORA
Inside Sephora's Branded Beauty Strategy. (2013, September 24). Retrieved
November 10, 2015, from
http://www.businessoffashion.com/articles/intelligence/marc-jacobs-sephoralvmh-branded-beauty-strategy
Sephora. (n.d.). Retrieved November 10, 2015, from http://ecommercenews.internetretailer.com/retailing/Sephora

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