Case Study of customer-centric campaign that utilized segmentation to reach the target audience with both traditional and digital media.

1. The Evolution of
Marketing Creating the
Number One Cosmetic
Retailer
''Beauty's where you find it''
Madonna, 1990

2. ''Beauty's but skin deep''
John Davies of Hereford, 1616
''Beauty is in the eye of the beholder'‘
Margaret Wolfe Hungerford, 1878
Statista reports indicate that the cosmetics industry brings in over $55 billion annually
(As of 2014)

3. Sephora began in Paris in 1970
Sephora was acquired by Louis Vuitton Moet Hennessy in 1997
Sephora is now it 30 countries with more than 1750 outlets
And sells 4 billion dollars in cosmetics a year.
Each store carries about 7000 different items
“Over the years, Sephora has also developed a
reputation for championing niche lines, a
segment of the market that has grown
exponentially over the past decade. Vegan-
makeup line Obsessive Compulsive Cosmetics
and the argan oil-based skincare collection
from model Josie Maran are two niche brands
that have recently benefited from Sephora’s
support.”
The Company

4. Sephora has changed the way women shop for cosmetics,
giving traditional department store counters their first real
competition in over 50 years. Their concept included
placing all items by type. A shopper could compare all
brands side by side with the assistance of highly trained
staff who is not paid on commission. This encouraged the
selling associates to sell favorite products, and meet the
needs of clients without taking into consideration their
commission. As the store has evolved they now display
their more than 7000 items by brands as customers prefer
In 2007 Sephora introduces the Beauty Insider
Reward Program.
The Company Listened

5. Sephora's "15 Days of Beauty Thrills“
The campaign was launched on Facebook along with the
"big thrills," Sephora also kept fans engaged and visiting the
website by offering "mini thrills" (e.g., a free eyeliner) with a
purchase at Sephora.com. Each year an the Customer
appreciate sale takes place, and has evolved as Sephora
focuses on the customer.
““The goal of this campaign was to
engage fans and drive traffic to the
newly designed Sephora.com
website…the campaign leveraged
partners that could help amplify the
message of the campaign, and the entire
experience was social; users could share
their experiences through Facebook to
create a viral effect.”
The Campaign: Chosen as one
of the Best Social Media
Campaigns of 2012
The Campaigns
(2015 Rewards Campaign)

6. 2015 VIB Campaign

7. Campaign Prizes
“One 5,000 point shopper will score a $1,400 Marc Jacobs
handbag packed with products from the designer’s forthcoming
cosmetics line. Another will jet to Los Angeles for a haircut with
Jennifer Aniston‘s hairdresser and Living Proof celebrity stylist
Chris McMillan (just don’t ask for the “Rachel”). And a single, lucky
10,000 point Insider will score a three-night trip to Paris to get
schooled at the Make Up For Ever Academy”.
V.I.B re-launched in 2009, Customizing rewards for
shoppers. Rewards are segmented by the amount
spent by the customer. Rewards increase as members
spend more.
The Segmentation
VIB Members Only Gifts

8. Touch Points
Sephora.com
Sephora.com - Launched in the U.S. in 1999
jcpenney.com/sephora
The partnership between JC Penney and Sephora was
created in 2006. Now with 516 boutiques inside
J.C.Penney stores and the new Sephora tab on
JCPenney.com, it is even easier to shop and purchase
Sephora products through the department store.

9. Facebook Tumblr YouTube Instagram
With links to 8 social media
accounts, there is a consistent
messages across all channels.

10. Google+ Twitter Pinterest Wanelo
Video, photos, and instructions are included
across all channels.

11. Email Mobile

12. The Message The messages are consistent across all
social media and duplicated on
Sephora.com with the Beauty Board, Advice,
and How-To’s.

13. With more than 10 touchpoints
consumers have the opportunity to
see the available rewards they can
receive for their loyal patronage.
Sephora responded to the misstep
with a letter to VIB members.
“To Our Valued Beauty Insider,
Thank you for contacting us regarding Epic Rewards. Despite our
best efforts to predict the response, demand was overwhelming,
resulting in our being out of stock very quickly. We deeply regret
this and apologize. We are currently reviewing each case and
will respond to you within 10 business days.”

14. Beauty Insider
60%
VIB Members
30%
VIB Rouge
Members
10%Sephora knows how many members will
qualify for each reward level before they
launch a campaign. The available data
includes many details about each member
and each segment of their VIB Membership.
The Big Data is collected with each purchase
as membership cards are scanned at the
point of sale.
The Members

15. 0
1000
2000
3000
4000
5000
6000
7000
Beauty Insider VIB Members VIB Rouge Members
Members Dollars Spent
The Data
 Dollars Spent
 Product Purchased
 Frequency
 Rewards Collected
 Coupons Redeemed
 Location of Purchase
 Purchases through Affiliate (JCP)
With the VIB membership card,
Sephora has more information than just
buying habits. They have name, address,
phone, email and birthday. They know
brand preference, product type and
time between purchases of each
product.

16. Using Data
0 1 2 3 4 5 6
VIB Rouge
VIB
Beauty Insider
Dollars Spent
Foundation Eyeshadow Lipstick
VIB Rouge members spend more than three
times as much as Beauty Insiders. The
available data should have better predicted
how many members would take advantage
of the free gifts.

17. VIB Rouge Purchase by Brand
Sephora Urban Decay Two Faced Benefits
VIB Purchase by Brand
Sephora Urban Decay Two Faced Benefits
By tracking purchases by brand, Sephora
could have better predicted that the more
expensive the brand the more Rouge
Members would respond to the free offers.
VIB would generate a greater response to the
elite brands and those Customer who are not
regular shoppers, or spend less than $350.00
annually would be less likely to take
advantage of the offers for brands they are
unfamiliar with.
Beauty Insider Purchase by
Brand
Sephora Urban Decay Two Faced Benefits

18. The Disclaimer
The notice of limited quantities only appeard
on the preview ad. Shoppers had to search for
a disclaimer about the number of prizes
available at each level. The original text for
the Website Relaunch/VIB Annual event also
excluded a disclaimer about the number of
prizes that would be awarded.

19. The Measurement
0
2
4
6
8
10
12
14
Purcheses During Evenet Purches Without Event Rewards Redeamed During
Event
Rewards Redeamed Without
Event
Beauty Insider VIB VIB Rouge
VIB Rouge members do
not wait for events to
purchase product or
redeem their reward
points. These loyal
consumers get much
more attentions for the
company, however to get
the lower level shoppers
to increase their
spending, the company
entices them with a
variety of rewards
throughout the year.
Even with this extra
effort, they still shop more
during events that earn
more points.

20. The Summary Sephora has create not only one of the most recognizable brands in the cosmetic
industry but they have also used every possible avenue to reach their target
audience. Whether the medium is video, magazine advertisement, mailing, or
social media, Sephora has built a customized message that is consistent across all
channels. With the available data, they should have been able to predict how
many consumers will redeem reward points during this years event. The is not
typical of the reward program or Sephora in general. They are customer
focused and provide quality products and training to both staff and clients.
“*Event takes place at Sephora inside JCPenney stores only. Must be a registered
Beauty Insider to participate. Gift available while supplies last. One gift per
client.”
As most consumers do not read the fine print, at the very bottom of the
presentation, the potential for misunderstandings is present across all channels.
This may have been avoided by placing the disclaimer in more spots throughout
the campaign.

21. About Us. (n.d.). Retrieved 8 11, 2015, from Sephora.com:
http://www.sephora.com/about-us
Carey, A. (2015, August 13). Sephora inside J.C. Penney opens Friday in The Shoppes
at Parma: Style News. Retrieved from Cleveland.com:
http://www.cleveland.com/style/index.ssf/2015/08/sephora_inside_jcpenney_opens.html
Friedman, L. (2012, December 12). The 8 best social media campaigns of 2012.
Retrieved from Imediaconnection.com:
http://www.imediaconnection.com/content/33265.asp#multiview
Hitz, L. (2014, Aug 19). 4 Things you Didn't Know About Sephora's Cross-Channell
Social Strategy. Retrieved from SimpyMeasured.com:
http://simplymeasured.com/blog/2014/08/19/4-things-you-didnt-know-about-sephoras-
cross-channel-social-strategy/#i.n0j08v1cggd42x
McEachern, A. (2015, January 12). Loyalty Case Study: Sephora’s Beauty Insider
(VIB). Retrieved from Sweettoothrewards.com:
https://www.sweettoothrewards.com/blog/loyalty-case-study-sephoras-beauty-insider-
vib/
Panych, S. (2013, July 30). Daily Beauty Reporter. Retrieved from Allure.com:
http://www.allure.com/beauty-trends/blogs/daily-beauty-reporter/2013/07/sephora-
revamps-beauty-insider-program.html
Perx Mobile CRM Build a Mobile bridge to your customer. (n.d.). Retrieved Aug 9,
2015, from cdn2.hubspot.net: http://cdn2.hubspot.net/hub/291967/file-565403269-
pdf/Perx-White-Paper-201403.pdf?t=1394442326000
Rodewald, W. (2013, July 26). Sephora’s Beauty Insider Relaunch: What Happens
When You Spend $10,000 on Cosmetics. Retrieved from Dailyakeover.com:
http://dailymakeover.com/sephora-beauty-insider/
Sherman, L. (2013, September 24). Inside Sephora’s Branded Beauty Strategy.
Retrieved from Businessoffashion.com:
http://www.businessoffashion.com/articles/intelligence/marc-jacobs-sephora-lvmh-
branded-beauty-strategy
The Surprising Secret to Sephora's Digital Success Is a Focus On Brick-And-Mortar.
(2013, July 30). Retrieved from Racked.com:
http://www.racked.com/2013/7/30/7657827/sephora-just-unveiled-a-revamped
References
VIB Rouge members spend more than
$1000. per year and VIB level members
spend more than $350. per year. There
are no standards for minimal sales to
receive rewards. One purchase of any
amount will qualify for the reward
program.
*(Membership counts and sales dollars
are estimates of proportions and
percentages of members to sales. The
sales numbers and actual membership
count could not be found)