As French cosmetics giant Sephora celebrates its 10th anniversary in Singapore this year, it is forging ahead with virtual and augmented reality initiatives as well as a new  bricks-and-mortar store in buzzing Westgate.

SINGAPORE (May 21): For many women, choosing a new lipstick can be quite a hassle. They must pick the right shade to match their skin tone, which involves riffling through dozens of options. They then narrow down their choices to a final few, before testing them on the back of their hand, in a process known as swatching.

And even then, it is not the most accurate way of testing.

But those days may soon be over, if Sephora has anything to do with it. In 2016, the French cosmetics giant unveiled Virtual Artist, an augmented reality (AR) feature that uses facial recognition to apply virtual make-up. It scans the user’s face to detect her lips and allows her to try on as many lipstick shades as she likes — virtually.

The feature was made available in Singapore last year on the Sephora app, complete with an instant, click-to-buy function. This year, Virtual Artist made its leap into two of Sephora’s bricks-and-mortar stores, at ION Orchard and Westgate. There, on iPads mounted on display shelves, a lipstick hunter can swatch to her heart’s content.

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In March, Virtual Artist expanded its try-on function to eyeshadows and eyeliners, which meant users could now give themselves a virtual makeover.

Mathieu Sidokpohou, Sephora’s Southeast Asia managing director of markets and new ventures, says the company will be progressively rolling out Virtual Artist in other stores.

In a selfie-obsessed, image-driven culture like ours, such innovations are helping retailers stay relevant. However, it is not the first time Sephora has disrupted the status quo.

When French businessman Dominique Mandonnaud acquired Sephora in 1993, he applied the “assisted self-service” model that had worked so well for his own perfume chain — which he merged under the Sephora brand — since 1969. The model encouraged customers to try the products before buying.

It seems like a given these days, but prior to Mandonnaud’s initiative, perfumes and cosmetics were typically kept beyond the reach of customers. If you wanted a spritz of the new Guerlain or Chanel, you had to ask for assistance. Many beauty counters in department stores still adhere to this practice.

Such daring — and subsequent success — did not escape the notice of French luxury conglomerate LVMH (Moët Hennessy Louis Vuitton), which snapped up the burgeoning retailer in 1997. Today, Sephora counts 2,300 outlets in 33 countries and is the world’s top speciality beauty retailer, according to market research firm Euromonitor.

LVMH does not disclose revenue figures for companies under its umbrella. However, its 2017 annual report cited “organic revenue growth of 13%” for its selective retailing arm, which includes Sephora as well as Hong Kong travel retailer DFS and Parisian department store Le Bon Marché Rive Gauche.

It also reported that “Sephora continued to gain market share”, with growth “particularly strong in North America and Asia”.

West side story

On Feb 1, Sephora opened a flagship store in Westgate, Jurong. At 5,300 sq ft, it is the biggest store in the heartlands and 50% larger than the previous outlet at neighbouring mall JEM.

Just as fashion brands such as Armani Exchange, Calvin Klein Jeans and COS bring a downtown vibe to Westgate, so too does the Sephora store, which aims to offer experiences that are typically found only in the ION Orchard flagship store.

The launch attracted about 500 enthusiastic customers, who queued patiently outside the store until it opened at noon. What was surprising — to this writer at least — was that the queue comprised mainly teenagers and millennials. It challenged the assumption that digital natives preferred to shop online.

“Beauty is a very sensorial industry,” explains Sidokpohou. “Many customers still want to see, smell and touch [the products]. What [bricks-and-mortar] stores need to do is become experiential hubs where customers learn techniques such as how to do contouring or smoky eyes. What we’re pushing is more in-store services. We have Beauty Studios, where you can get 15-minute makeovers without purchasing anything. If it’s ­Friday night and you’re heading to a party after work, you can get a touch-up. Experiences like these matter.”

Besides allowing customers free play of the products in the outlets, Sephora’s success also boils down to the plethora of in-store activities it conducts. This includes product launches and masterclasses in skincare, make-up, fragrances and cosmetic devices.

But why Jurong? Sephora has eight stores in the city centre and only three — in Nex, Tampines 1 and Westgate — in the heartlands.

“In Singapore, we have a ‘downtown strategy’ and a ‘suburb strategy’,” says Sidokpohou. “We want to win with locals first, so when we look at strategies on where we want to operate stores, we look at having them where people live. We want to have a presence in every meaningful suburban area. And when you look at what the government plans to do in ­[Jurong], it’s clear that it’s going to continue growing and thriving.”

Omni presence

In 2015, Sephora acquired online beauty retailer Luxola for an undisclosed sum. In the four years since it was established in 2011, the e-commerce start-up had gained enormous traction, penetrating 12 ­Asia-Pacific markets and offering 4,000 products from 250 brands. The acquisition gave Sephora a ready-made e-commerce solution and solid customer base.

“Luxola came with two things: an e-store and a lot of digital capabilities,” explains Sidokpohou. “The Luxola team knew how to deal with all things digital, from performance marketing to social marketing, which were capabilities we didn’t have in the past. It gave us an immediate opportunity to become an omni-channel retailer.” 

Three years on, says Sidokpohou, e-commerce now accounts for 20% of total business. He believes it will constitute an even bigger proportion of the business.

And there was a pleasant surprise as well. “We’re selling more in our bricks-and-mortar stores now than before we acquired Luxola,” says Sidokpohou, referring to how increased awareness from Sephora’s online presence has translated into increased foot traffic at its stores.

Elsewhere, Sidokpohou is focused on building up Sephora’s customer relationship management. On the tech front, the company is also working on AR initiatives that will allow for more personalisation of content and experiences for customers.

And, as 2018 marks Sephora’s 10th anniversary in Singapore, there are activities planned every month, culminating in June with a big beauty event. “It’s a big deal. We want to give back to Singapore customers for their vote of confidence,” says Sidokpohou.

Timothy Chiang is a design junkie through and through, believing that everything from a doorknob to the entire building needs to display thoughtful design. He lives for meeting design luminaries.

This article appeared in Issue 831 (May 21) of The Edge Singapore.

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