When you think of companies saving the information you share with them for their own purposes, you might think identity theft and getting caught up in manipulative multi-level marketing schemes — not free lipstick. But while we were wondering how an ad on Facebook knew we’d been thinking of ordering Glossier birthday balm last week, Ulta Beauty was coming up with a way to use your shopping data that actually benefits you.
WWD reports that the retailer’s master plan first hatched after the huge Urban Decay Vice lipstick launch, when the brand offered Ulta 150,000 shiny new sample packages to distribute to its most loyal fans. But with 24 million active members of its loyalty programs to choose from, Ulta didn’t know where to begin.
So they sorted through the data garnered from those programs to find customers who shop Urban Decay, customers who shop lip products, and customers who shop lip products but had yet to buy any from Urban Decay. The goal? To figure out what kind of customer would be most likely to fall in love with the new launches — and it worked. After shipping out samples of the lipsticks to a group of customers from each category, Ulta measured over several months to find that a whopping 41% of the targeted demographic returned to the store for a restock.
The success of that first initiative taught them that giving shoppers a chance to try the products for free before they commit actually leads to more sales in the long run, so they’ve been giving away samples in the same way every since. But Ulta’s grab for world domination isn’t finished just yet — far from it. The number of customers who subscribe to the loyalty program is rapidly growing, which means all the more opportunity for the company to figure out what the people like and keep them coming back again and again, while also beating competitors to the punch.
“Our success, at least over the last several years, has allowed us to build a really strong pipeline of newness,” Eric Messerschmidt, Ulta’s senior vice president of marketing strategy, loyalty and CRM, told WWD. “Brands are coming to us. [It wasn’t this way when] I started at Ulta six years ago. We had to scrap and fight for every brand.”
With an eye for new products, customer satisfaction, and that fighting spirit in everything they do, it might not be long before Ulta climbs to the very top of hot beauty destinations. Let's just hope that means more (and better) free samples for us, too.