Arvind Limited, led by textile tycoon Sanjay Lalbhai, has tied up with the French cosmetics and beauty retailer, Sephora, owned by Moet Hennessy Louis Vuitton (LVMH), to run it’s India operations, bagging both the store and e-commerce rights. The brand re-introduced its first re-vamped flagship store at Select Citywalk, Saket.
Spread over 3,000 sq ft carpet area, the new Sephora store looks much more bright and better laid-out in terms of category segregation than any other outlet in India. The product merchandising is such that it is easy to select and is placed in the way the brand wants people to use the products. The display at fragrance segment is at par with any other Sephora store worldwide.
Exclusively talking to Indiaretailing, Business Director, Sephora Vivek Bali said, “Sephora is planning to open 50 stores based on the same concept in 15 more cities including Mumbai, Bengaluru, Kolkata, Chennai, Hyderabad, Chandigarh, Jaipur, Indore, Lucknow, Ahmedabad and Surat.”
Sephora has already opened 7 stores including two in Mumbai and planning to open 7 more outlets by March 2017 end.
“All the upcoming stores will be opening in the mall as high street is more for fashion than beauty and any beauty store requires a good mix of people to coming into the store and that kind of a mix is possible only in a mall. So, it is a part of brand’s strategy to open stores in mall,” Bali added.
Sephora, that houses around 85 brands, has almost 15-20 per cent income coming from new product launches every month and it is planning to take it up to 25-30 per cent in the coming year.
With its navigation friendly layout, the revamped store enhances the shopping experience of the customers. The customer can walk in to the store and go to the area where they want to shop and find the products.
Lots of emphasis is on category demarcation and within the category, the position of the brand and within the brand, the position of the products. And the way the products have been placed, educates the customer in terms of buying the product.
Apart from emphasizing on the exclusive brands like Sephora, Make Up For Ever, Benefit, Burt’s Bees and Boscia it also emphasizes on Louis Vuitton brands like Dior and Bulgari, and also the selective global partners like Estee Lauder, Clinic and Lancome.
“60 per cent of the business comes from the in-house brands and 40 per cent from the rest of the brands,” Bali told Indiaretailing.
He further added,” Sephora had a robust growth last year on like-to-like sales and also overall sales. So, what we are looking at is Sephora as a brand in next 7-8 years should be Rs 1,000 crore brand. Make-up being the fastest moving category, 45 per cent of our business come from that segment.”
Sephora is primarily catering to customers that are 18- 40 years old and are fashion-conscious, beauty-conscious and are moving up the ladder and have enough disposable income to spend.
He said, “Beauty as a category is one thing that will primarily remain a brick-and-mortar story. No matter, how much people will try, ultimately the lady has to come to the store and try the products before she buys it. Unless, she is buying a product which she has already used. So online story will continue to be a reflection of the brick-and-mortar store. And 90- 92 per cent of the sales will happen at the store.
When questioned about marketing strategy at Sephora, Bali told Indiaretailing, “Sephora as a brand does advertises too much. We showcase everything in the store and therefore giving the customer, the best experience in terms of beauty is of prime importance. So, that remains the core principal in marketing for Sephora.”
Indian beauty market is about $6.8 billion and has been growing 18 per cent compounded annually in the last five years with two lead categories of face and eye growing at almost about 25 per cent. Lip and nail remains core products for India in the value and mass business, however, premium business category face and eye have also been performing extremely well.