Ulta Beauty plans to maintain its growth with 50 new store openings each year, enhanced last mile options and investments in media and AI, including the launch of an in-house retail media network. These efforts will form the core of the retailer’s strategic priorities for fiscal 2022 through 2024, which Ulta laid out at a virtual analyst and investor conference. The retailer is putting global expansion plans on hold as it focuses on its home country.
The new store openings will include pilots for smaller-format 5,000-square-foot stores that will feature “tailored assortments and services,” according to COO Kecia Steelman. The pilot for these locations will run through 2022, at which point development will continue based on the initial feedback and results.
Ulta also is planning to launch same-day delivery options in select markets. The retailer’s new “Beauty to Go” commitment promises that all buy online, pick up in-store (BOPIS) orders will be ready within two hours.
Additionally, Ulta is making a strategic investment in AI-powered technology company Adeptmind, which will power a new personalized search engine to make it even easier for shoppers to find what they need. Ulta also will let select brands use the GLAMlab virtual try-on tool to add lipstick and eyeshadow try-on options to their Google search results.
Brand partners also will benefit from the launch of UBMedia, Ulta’s retail media network. Brands will be able to use the service to place ads on the retailer’s site and app, as well as receiving relevant placement on outside platforms such as Facebook and Instagram.
“Reflecting our understanding about how the consumer and beauty category are evolving, we have refreshed our strategic framework, and we are excited to share our vision for Ulta Beauty’s future,” said Dave Kimbell, CEO of Ulta Beauty in a statement. “We have a long record of disruption, creativity and success, and we intend to build on this foundation and continue to lead the beauty category, seamlessly connecting physical and digital channels, expanding our market share and increasing member loyalty.”
Ulta has been steadily growing despite the need to close 1,300 stores during the 2020 lockdowns, and has even opened a 12,000-square-foot store in New York’s Herald Square that combines both physical and digital shopping. The beauty retailer expects to maintain 5% to 7% annual net sales growth in the coming years, crediting its ability to keep pace with changing consumer trends.
“We’re more connected now than ever before, and we must remain hyper-relevant to win the share of the hearts and the wallets of all of our guests,” said Steelman during a session at retailX 2021. “You have to have that true connection with them. We believe that beauty moves at the speed of culture, and I can’t think of a time when that’s more important than it is today.”