Sephora Case
Case Analysis: Sephora Direct: Investing in Social Media, Video and Mobile
Track 1 – Due 2/19
Yubin Kwon / Barret England/ Tuesday 4:30PM
Company Background/ History and Growth
Started as a single perfume shop in France by Dominique Mandonnaud in 1969, Sephora was designed for customer to assist themselves with multiple brand products as Mandonnaud rebranded his combined set of stores. Mandonnaud expanded the chain throughout France and acquired 8% of total French retail perfume market and was purchased by LVMH, luxury product group, for $262 million in 1997.
Sephora expanded their market with cosmetic products under LNMH’s ownership and opened its first U.S store in New York City in 1998. But as they faced difficulty supplying products from major prestige brands such as Estee Lauder and Clinique, Sephora relied on less known brands to fill its shelves. Sephora’s strong relationship with small cosmetic brands and atmosphere encouraging experimentation with multiple brand products soon attracted younger customers than department stores. Within several years, Sephora captured larger market share with bigger prestige cosmetic companies who first refused to supply their product to Sephora.
Brand Image/ Description Sephora offers more than 200 brands ranging from classic lines to emerging brands with over 20,000 products. Sephora carries prestige brands which were perceived as more upscale than those brands carried at drug stores and supermarkets. Since their foundation was to design stores where customers can assist themselves with multiple brand products, Sephora is known for its vibrant store atmosphere that encourages trial and experiment mainly targeting women aging from 25 to 35. Dominant color themes with black, white, and red and fun party atmosphere of stores appeal to younger, hipper customers.
Most Important Facts * Sephora.com was projected to generate 15-20% of Sephora USA sales in 2010 * Sephora.com ranked top 50 retail sites in U.S
Track 1 – Due 2/19
Yubin Kwon / Barret England/ Tuesday 4:30PM
Company Background/ History and Growth
Started as a single perfume shop in France by Dominique Mandonnaud in 1969, Sephora was designed for customer to assist themselves with multiple brand products as Mandonnaud rebranded his combined set of stores. Mandonnaud expanded the chain throughout France and acquired 8% of total French retail perfume market and was purchased by LVMH, luxury product group, for $262 million in 1997.
Sephora expanded their market with cosmetic products under LNMH’s ownership and opened its first U.S store in New York City in 1998. But as they faced difficulty supplying products from major prestige brands such as Estee Lauder and Clinique, Sephora relied on less known brands to fill its shelves. Sephora’s strong relationship with small cosmetic brands and atmosphere encouraging experimentation with multiple brand products soon attracted younger customers than department stores. Within several years, Sephora captured larger market share with bigger prestige cosmetic companies who first refused to supply their product to Sephora.
Brand Image/ Description Sephora offers more than 200 brands ranging from classic lines to emerging brands with over 20,000 products. Sephora carries prestige brands which were perceived as more upscale than those brands carried at drug stores and supermarkets. Since their foundation was to design stores where customers can assist themselves with multiple brand products, Sephora is known for its vibrant store atmosphere that encourages trial and experiment mainly targeting women aging from 25 to 35. Dominant color themes with black, white, and red and fun party atmosphere of stores appeal to younger, hipper customers.
Most Important Facts * Sephora.com was projected to generate 15-20% of Sephora USA sales in 2010 * Sephora.com ranked top 50 retail sites in U.S