THE STORY OF HOW SEPHORA HAS REINVENTED 
IN-STORE EXPERIENCE 
AT THE DIGITAL ERA

Did you know that you could get welcomed by Nao robots at the entrance of Sephora Flash? How the France leading chain of perfumes and cosmetics distribution has arrived there? Through an exciting path ... Let me take you through to it!

Sephora representes 1,900 stores in 29 countries worldwide from Limoges to Dubaï, from New-York to Milan and 300 stores in France. It opens between 7 and 10 stores per year and has 6 M annual visitors in the Champs Elysées flagship store (which is nearly the same number as Eiffel Tower's visitors !).

Innovation is Sephora's main priority. Since from the beginning of its history, the beauty-retailer has shaken up the distribution codes in the field of selective fragrances, by introducing the self-service. Before that, there was a counter with a salesperson between the scents and the client who couldn't directly reach and try them on herself. 

The brand has even got its own innovation laboratory : the Sephora Lab. It is an internal program involving collaborators to develop new creative concepts in terms of customer relationship. Yes, because YOU are the priority of Sephora, the brand is always looking for new ways to make the shopping experience more and more unique.

"We cultivate innovation, creativity, nonconformity and freedom to experiment"

After this small formal introduction, let's get into the bare bones of the topic !

First of all, let me dive you into the atmosphere of this store swarming of novelties and teeming with various sounds. Close your eyes (or not), listen to the following sound environment and try to project yourself over there. Ready ? Let's start !

Now, you know exactly what it feels to be in the connected store of Sephora! 

Sephora Flash is not only about adorable robots to welcome the customers. This is the first connected store the brand opened in October 2015 in Paris and honestly, this is such a technology concentrate! The full store and the customer experience have been thought "digital". 

In a space of only 130m² (when the average size of a Sephora store extends to 400m²), Sephora Flash proposes an exhaustive range of products with all of its       14 000 references. No, this is not a magic trick. So HOW this space optimization is possible? Simple: you are walking around the store and there ... BANG! You just fall for this amazing lipstick. It is available in the store. Cool ! You put it on your basket and keep on shopping. But only 3500 references are physically available in the store. For the rest, a virtual basket (a card using NFC technology) is distributed at the entrance.

It gives you a complete access to the digital catalog of the brand. You can order the products that are not available in-store by adding them on your virtual basket. They will be delivered to you or you can simply pick them up the next day in the store. Finally, you can buy both your physical purchases and your virtual ones at the same time through a unique payment. That's how this hyperconnected store offers a multichannel experience.

In terms of merchandising, digital screens placed at the top of the walls broadcast videos of the actual campaign or season. You are entirely immersed in Sephora's universe.

The fragrances are not available in stocks. There are only testers that are staged in a linear wall. That make them look precious and rare. 

Integrated tablets help you find and know more about the product you are looking for. All the testers are equipped with NFC tags. When you put one of them on an interactive terminal, you get an information sheet about it. 

To avoid long waiting lines, 4 mobile cashiers stride along the store with payment terminals. This way, it makes the purchasing process more fluid. 

See? Everything is done to make your life easier! Will you believe me if I told you that you can even charge your cellphones on safety lockers during your shopping? 

"The promise of a fluid customer journey, from the entrance to the paiement, is completed." - Laure Pasquier-Bardy - Project manager of Sephora Flash

For the most narcisistic of us, an interactive mirror to take selfies is placed in the store. The pictures are then sent to you by email and you can share them on social media to show off that YOU have just experienced a unique shopping experience. Or, you can simply show how beautiful you look now that you have been made up by Sephora's make-up artists. Isn't that great?

To thank you for all your purchases, the brand gives you some free samples. I admit. This is nothing new. BUT what if I told you that these are not given by the cashiers as usual but that you get them yourself through The Mini Beautic. It makes the experience more playful and tailored as you can choose till 10 customized samples adapted to your skin color and your tastes, where as the cashier usually gives you inadapted ones. But it adds a non-human mediation between the client and the brand.

Is Sephora heading for dehumanization of the customer relationship by dint of making it exclusive? I would say ... NO AT ALL. Here why: did I told you that this little store has got nearly 15 sellers to take care of you? This represents 8 sellers per square meter: a record!

"This a community store"  - Marie-Christine Marchives - Managing director of Sephora France

Furthermore, we find again Sephora's famous beauty services (makeup bar, brow bar etc.). 

But a little disappointment … Don't expect to be madeup by robots. Nao is not going to fix your eyebrow either! Proof that the brand is not sacrificing human contact in favour of 100% technological experience. The purpose is to make you feel closer to the brand by proposing products that you can find in the famous Flagship, just down your street. That's why proximity is also a key element to define Sephora Flash. So many services and sellers in such a little space: isn't that enough to bring people closer to each other ? This is how Sephora's spirit is embracing you in this particular store.

Nope, this is not a spelling mistake. Phygital. You have probably never heard about this word before. It is a neologism formed with the words "physical" and “digital”. It refers to the initiatives taken by brands in order to massively integrate digital in physical stores. In fact, this is a really recent word. It has been invented in 2013 by the australian marketing agency Momentum. But, after all, what are the exact stakes that this neologism covers?

A link between online and IRL (in real life)

Nowadays, the purchasing process of consumers has totally gone upside down. There is no more "web-to-store"or "store-to-web" predictable movement. Pratices have been exploded and fragmented and brands should adapt their strategies to that. 

Also, they should keep in mind that people are more and more familiar with online shopping experiences that are customized and make them feel unique.         E-commerce websites exactly know my aspirations, my preferences and my shopping habits. It suggests products according to my own purchase history. The website of MAC knows my favourite lipstick colours and my tastes more than anyone in my circle! Now, I want to feel that much special regardless of through which channel I am shopping. That's right! I am seeking for that same unique relationship with the brand. That's when digital tools step in to guide the customer's journey in shops and to propose the same tailored service in real life.

Phygital is a great lever to propel in-stores sales. This is a way to avoid the disparition of physical stores to the benefit of 100% e-commerce. Indeed, to make customers come back in-store has become a real challenge for the brands and quite paradoxically, digital seems to be the solution to this problem. According to the study of "Digital Store" (IPSOS – 2015), 60% of french people think that digital is an incentive to make them come in-store. 60% of them also reveal that digital in-store make them buy. Companies should be in line with their customers that are always connected. Besides, with digital devices, distributors are more efficient at each stage of their customers' purchasing path. They also improve their image of modernity, associating themselves with new technologies.

Nevertheless, brands shouldn't forget that phygital is not only about multiplying QR Codes, interactive terminals and digital screens in stores. Before being connected, a store should be a warm concentrate of human and welcoming. When I enter into a shop, this is what I am expecting for. Stores should be places of life where one enjoys coming to see the products, try them, get advises from the sellers. That's why the biggest issue for the points of sales digitalization is the human contact. Phygital should draw the customer closer to the brand by making him want to leave his home, to come in stores, stay, enjoy the shopping and buy.

This can't happen without the sellers who have a major role to play in it. They make the store a place of relationship through a strong human presence. They make the customers feel taken care and recognized. Moreover, clients expect indeed expertise, tailored recommendations and pleasure in the conversations with the salespeople. Digital is an adjuvant that will help the stores reach this degree of proximity with the client. Here is a striking example : 

L'Occitane en ProvEnce and the empowerment of sellers

The french ecological beauty brand L'Occitane en Provence has equipped its salesmen with tablets in 400 stores, so that they can expand their customer database by adding new data from the shoppers at each of their passage. An app allows the salesmen to retrieve information from the client's purchase history (if he has already bought from them: what products he buys, how often etc.). 

On the client side, thanks to augmented reality, the app allows to photograph a product and then get additional information about it, like customer reviews. You can also photograph a catalog page and place an order. These devices connect online and offline and are a great way to prolong CRM (customer relationship management) after the passing of the client in the store. It is indeed possible to continue the dialogue through retargeting technics. For example, after the passage of the client at the store, we can send him an email to inform about the launch of new products linked with what he has bought or looked for in the shop the last time he came. 

The brand has also implemented in 2015 a connected table at the Carrousel du Louvre. A screen displayed above the table indicates where the product you are looking for is located in the store. Agnès Debains (omnichannel project director of the brand) points out that the main advantage of this connected table is to be able to break down the barriers of languages (all the information are available in 10 different languages which is quite relevant in a touristic place). 

But above all, it is a means for the salesperson to create a relationship with the customer by completing information or guiding him towards the checkout. This kind of device helps transforming a simple interest or curiosity into a purchase act. So, l'Occitane en Provence is a discreet brand that has perfectly apprehended the challenges of combining retailing and digital!

"Beyond the purchase of the product, customers need meaning and experience" -  Hélène Gombaud-Saintonge - Director of FullSix Data webagency

Fashion brands have been the best so far to develop phygital concept stores. They are putting digital at the service of in real life experience in a relevant way. Many brands are simplifying the customer itinerary by virtually "extending" the space of their stores. Let me give you two striking illustrations of that!

Undiz Machine : a small shop with a large stock

It's a spectacular concept developped by the underwear brand. Customers choose their products on digital terminals and these are immediately delivered by a system of aeropulsed capsules which transit through transparent pipes installed in the store. All a playful staging!

Rebecca Minkoff : 3.0 SHOPPING

The American brand of high-end ready to wear Rebecca Minkoff is also a pioneer in the field. Let me tell you what happen when you walk into its connected store. As soon as you enter, an interactive board welcomes you and offers you a drink ... in exchange of your phone number (a smart way to take your number and enrich the client's database) . You are informed by SMS when your refreshment is ready. The giant screen also allows you to access to the brand's lookbook and to add products to your virtual cart. Once your selection is completed, the salesman receives a notification with the list of items to be placed in one of the connected fitting rooms of the store. Again, an SMS informs you which cabin has been assigned to you. There is a magic mirror in the fitting room: the clothes, equipped with a RFID tag, are displayed directly on the touch screen. This way, you can easily request another size or additional accessories. Isn't that convenient? 

These best practices show how phygital offers a very large number of creative ways to tame customers's online habits and enrich their stores' services. 

Actually, what about cosmetic brands? Let's see how Sephora's main competitors are dealing with phygital.

The natural Cosmetic store of Yves Rocher

Among the best practices, we should mention the first concept store of Yves Rocher opened in 2014 in Paris. The french brand has put natural cosmetics, which is its baseline, at the heart of this store. We find that in all its nooks. For instance, the display stands are plant-covered. 

On the first floor dedicated to fragrances, don't expect to have your noise irritated by many sents intensely sprayed in the air. The brand has arranged a very elegant perfume organ. You can discover the smell of fragrances directly in the tubes, without having to spray the perfume. 

A planisphere connected to tablets gives access to information about the products' provenance. An excellent way to showcase the brand's transparency and to prove that its "green" labels are deserved. 

On the ground floor, near the "Botanical beauty bar", you can also find a white seat, like the ones you can find at the dentist, with an electronic tool hooked up to. Nothing reassuring... But don't worry! In fact, it's a confortable way the brand proposes to realize your customized skin diagnosis. The saleswoman can then proposes products appropriated to your skin type. 

A real jewel of "connected greenery" that dives you into the brand's values and core identity. 

Nocibé and the "perfume diagnosis"

In September 2016, the french beauty retailer Nocibé has started to test a new concept called the "perfume diagnosis". Through a tablet, we have to answer to a certain number of questions about our tastes and our personnality. Then the service proposes a fragrance according to our answers. This is a playful way to engage the customer and make her enjoy her moment in the store. But what my personnality is actualling saying about my tastes in terms of scents is still an unanswered question...

KIKO'S DIGITAL POINT OF SALE ADVERTISING

Kiko uses small screens at the top of display stands. These are a way to improve point of sale advertising, animating the store and promoting some range of products. It has to attract the attention of the consumer which is constantly moving quickly. That's why the videos have to be eye-catching and efficient even without sound. They should be visible by far and the message has to be clear to orientate the purchasing decisions.

As for MAC, its Champs-Elysées flagship store presents a column of 5 m in height with images and video animations on its 4 faces. Yet impressive, this is the unique digital element you could find in this store, despite a futurist architecture...

Other brands, even less unadventurous, are just at the stage of analysing audience flow and measuring the « hot areas » to optimize flows in their stores like Marionnaud.

With all these examples: the picture is a mixed one... Most of beauty retailers are not exploiting correctly all the resources of phygital to improve brand loyalty in their stores. They are still groping around, trying new interactive possibilities but still not going enough far, using all the creative opportunities offered by phygital. 

As for Sephora (coming back to the protagonist of our story!), it has succeeded to create an entertaining shopping experience using digital in real life. No other beauty retailer seems to have pushed that far the concept of a phygital store to reechant customer experience. But if the brand has achieved such a groundbreaking challenge, this is not by chance! To manage this transition, it had to rely on a rich omnichannel strategy that has served as a springboard to the advent of its connected store.

Providing a memorable tailored experience to the client has always been the main concern of Sephora. The beauty retailer has kept on creating new innovative services in-store to pamper its customers. The aim is to offer an unforgettable service to the client by taking care of her. She clearly does everything to seduce the client who enters in the store and to keep her in there as long as possible. For that, she proactively uses her following charming assets :

The Make up bar : with a free 15 min flash make-up

The Benefit brow bar : that proposes an expertise in eye-brow plucking and coloration

The Gift Factory

That proposes 8 gift-wrapped parcels' colours. The client can also choose the box, the ribbon and the adhesive labels. It makes the gift packaging more playful and customized, meeting the wishes of each customer.

The engraving workshops that offers an exceptional service 

You can customize a bottle of perfume (even from a great creator) with someone's name in order to offer him or her a unique gift.

The VIP lounge service : exclusive services for a remarkable beauty experience

With a private welcome, this privilege is reserved to the clients with the "Gold" loyalty card and is only available in the flagship store. You can get advices from a make-up expert especially assigned for you!

All these services are part of Sephora's seduction strategy. More than just a beauty retailer, she is turning into a genuine beauty parlour by going a step further that her competitors to doll up her beloved customers. We find back most of these services in Sephora Flash with the addition of novelties like the Make up For ever eyelash bar to learn how to correctly fix eyelashes.

CONNECTED MAKE-UP CLASSES

In Sephora's american stores, you can also get free make-up classes with tablets placed at the center of some shops. 

In a nutshell, Sephora has always been deploying a strong sensory marketing in-store to win the heart of her loyal customers and mark their minds. This way, they will come back to live this privileged experience again. 

Apart from these in-store customized services to enrich the shopping experience, Sephora has always been at the cutting edge of digital. She is indeed doing everything to optimize and improve its online customer experience.

A pioneer in Social Media

CHATBOTS

Sephora was the first brand to communicate on the chatbok Kik : « Chat bots are computer programs that mimic conversation with people using artificial intelligence », according to the definition of the Guardian. This way, Sephora can lead a customized relationship with its customers providing them tips or piece of advices linked with their concerns and what they are looking for: tutorials to learn how to make contouring, gift ideas for Christmas or products adapted to their skin colour for example. 

This recent conversationnal marketing tool allows brands to have a «one-to-one » conversation with their clients at anytime. The LVMH-group beauty retailer can build a unique relationship with the customer by engaging a personnal conversation on an instant messenger. However, it musn't be too intrusive and it needs to stay qualitative. Recently, the brand has improved the quality of its communication on Kik with the add of new functions : « Sephora Reservation Assistant » to fix an appointment with a seller, and « Sephora Color Match » which helps the customer take a purchase decision using colour recognition from pictures (if you want a lipstick shade that exactly matches your dress for instance).

Also, the brand has deployed other chatbots on tools like Messenger. You can upload pictures of yourself on it and Sephora proposes different shades of make up and products from its catalog. She goes even further by offering a visualisation of the product on the picture you have sent to them using facial recognition. The purpose is to attract millenials who don't usually download brands' apps. With chat apps, the brand can reach them and win new young customers.

SNAPCHAT

Sephora is also strong on Snapchat. She was one of the first brand to communicate on the Discover channel of Melty. The beauty retailer has integrated geofilters in all its stores so that customers can take a snap and share it using tags like « Let's beauty Together ». Sephora has also decided to reward its followers on Snapchat by offering them gift cards. The transformation into an act of purchase is indeed the main stake of the beauty retailer on mobile. On July 2016, Sephora launched a shoppable Snapchat campaign using Emoticode, a buddy app to Snapchat that converts screenshots into clickable URL linked to a product. This way, the brand boosted the monetization of her social media content and generated trafic to her website

Also, to build its audience, the beauty retailer regularly collaborates with digital influencers like Hannah Bronfman (who did a "day in the life" Snapchat story centered around "the meaning of beauty for Sephora").

THE BEAUTY BOARD

The beauty retailer also launched its own social network 100% dedicated to makeup : The Beauty Board. You can share your pictures or makeup tips on it. Of course, you may want to tag the Sephora's products you are wearing on the pictures and redirect the interested people to the brand's website. Like on Facebook, you can like and comment the photos. This is a relevant way to see clearly how a shade looks like on a person and figure out better if it will look nice on us or not. Therefore, the brand creates and gathers a community with the same interest: makeup.

MOBILE APPLICATION : THE VIRTUAL ARTIST

Sephora is regarded as one of the best brand to use highly interactive app to drive revenue and loyalty. The most striking example is her app The Virtual Artist which is now available through a website. It allows to test different lipstick colours and different types of eyelashes on a picture you have uploaded. The app directly indicates what is the brand of the product you are testing and which exact shade it is. Then, you can easily purchase the product through the redirection to Sephora's e-commerce website.

The brand puts the customer at the heart of its concerns and make the client the protagonist of its communication strategy. There is a starification of the customer. This way, Sephora "humanizes" its digital communication with these tailored services that make the customer feel closer to the brand.

NOW, LETS SEE HOW SEPHORA IS INTERCONNECTING ITS ONLINE AND OFFLINE STRATEGY!

COLOR PROFILE

Add a teaspoon of technology to all the brand's in-store services we have seen before and you get the "Color Profile". A real technology jewel devised by the brand. The saleswoman captures the color of your skin with a colorimeter. The tool then gives you the exact shade of your skin colour with a Pantone code. Finally, you get a list of fundations with the adapted colors to your accurate skin colour. It reenchants customer experience by pushing the customization very far.

MYSEPHORA

The brand also invented an exclusive kind of customer relationship management in store with the launch of the app MySephora in 2012, destinated to the clients with the loyalty card. If you think this is a classical loyalty app as any other brands can propose, think again. You have within easy reach the whole catalog of Sephora in an intuitive way, you get tutorials and you find the latest trends in the "Hot Now" section that also shows the backstage of the brand. The “Sephora Playlist” provides a selection of products based on your specific profile.

But the real added value of this app is that, in-store, sellers are equipped with tablets with the very same app that allows them to know exactly what are your purchasing habits when you ask them for advices. This way, it avoids all the usual questions and the salesperson is precisely aware of your shopping history and your consumption habits. He could propose to you individualized advices and product recommendations that are appropriated to your profile. During the discussion, he can modify the data, enter for each product proposed "likes" or "dislikes", depending on your answers. The purchase history allows to find a product that you have already bought but that you have forgotten the name. It also indicates the articles that you regularly buy to remind you of a possible deadline. In short, it knows about you better than you do!

"The revolution is the customization of customer relations. We are entering a new era in terms of          in-store CRM" Rachel Marouani - ex - E-commerce and Marketing Director of Sephora

On the whole, we can see that Sephora is an early-adopter of all kinds of digital innovations. The brand is always ready to undertake groundbreaking services. It is not afraid to take risks in order to be ahead of his time and to state its avant-gardist DNA.

Digital and the consideration of each client are Sephora's 2 key words. With all these tools, Sephora shows that it takes on board the uniqueness and the peculiarities of each customer. The brand is using connected tools in real life not only to facilitate the act of purchase but to offer a meaningful experience to her « cherished » clients. This is exactly how the brand differenciates herself from her competitors, that have a pretty big backlog to catch-up.

We can notice that a two-way process is implementing here. First, the brand started to transpose the spirit of its stores and the specific way it takes care of its customer online. Now, the beauty-retailer is doing the opposite. It is transposing its online storytelling expertise in its stores to make them places where customers will enjoy shopping and spend time. Indeed, the brand draws on its digital resources to improve its in-store shopping experience. 

Therefore, digital storytelling is not only limited to the Internet, mobile or online experiences but we can widen it and use it as a springboard to enhance in-real-life shopping experience. We can combine different channels to create a synergy between the store and connected tools. These have to be anchored in real life in a relevant way. This multichannel strategy enriches in-store experience and make it « funnier », in a perspective of retailtainment (retailing that is entertaining!).

Sephora Flash gets inspired by the digital strategy of the brand as it participates, in the same way, to the empowerment of the customer. In the connected store, the combined use of online and offline ressources eases the immersion of the customer into Sephora's world which is wider that just a beauty shop. The customer is free to stroll into the store and test the products. She can play with all the interactive tools and get taken care by the sellers. All these impact the client's purchasing behaviour by the staging of the shopping experience. The phygitalization of the customer journey involves a process merging human contact and digital at the same time and Sephora has clearly undestood that. It's making the store be at one with its core identity. 

All of this make Sephora a digital innovation pioneer in the field of selective cosmetics retailing. The brand has understood very early and clearly, before all its competitors, the stakes of phygital.

The 4 key takeaways of this case study are that :

1. Point of sale digitalization is unavoidable in a business strategy nowadays. Indeed, digitalization is an excellent way to attract customers in-store at a time when e-commerce is taking more and more importance in people's purchasing habits.

2. Phygital has to bring a practical service to the customer and solve its in-store pains with a real added value that saves time and helps with the selection of products. It must eases the shopping experience and delight it with a "whaou" effect. For that, the brand has to clearly identify its client's expectations and satisfy them. Digital in-store is indeed a complementary tool to traditional sales tools. It has to make the customer think “I would not have experienced all these playful services by ordering a product from my bed on my laptop in the website of the brand. That's why, I will come back”. In fact, digital in-store has to retain customers, not only to the brand but to its physical stores. 

“The digital must bring the right service at the right time to the right person” - Romain Thibault, Digital Project Manager and CRM at Unibail Rodamco

3. Think omnichannel : brands should integrate mobile strategy to their in-store experience. Indeed, "A customer who enters into a shop has already cost 20 € for the brand because he has used all the online tools, from the website to the applications, set up beforehand" says Pauline de Breteuil, Chief Digital Officer of VIVARTE. “Digitalization represents business opportunities”. Nevertheless, we may not think exclusively in terms of ROI (Return On Investment) but in terms of offering an enhancive shopping journey to the client from online to in-real-life.

4. Customization : with phygital, brands should push further their CRM providing a tailored shopping experience, like the one most of clients experiment online.

Sephora continues her point of sale digitalization movement with the installation of transparent LED screens on the store fronts of its shop in les Halles mall. They do not block the view on the store's inside and underline the futuristic identity of the brand. She is the first brand to use the LED technology in France.

In terms of future tracks to explore to improve the phygitalization of in-store marketing, the link between social media, connected objects and the store can be reinforced. The increasing power of IOT (Internet Of Things) represents indeed a variety of creative opportunities to develop. Thus, the connected store can also be seen as a laboratory to experiment new CRM strategies.

Today, brands are more and more becoming aware of the stakes of phygital. The upmarket Department Store Galeries Lafayette has, for example, recently launched a call for proposals called AGORIZE to reinvent its in-store experience using digital ressources.

3.0 strategies seem to have great days upcoming. To be continued ...