Sephora.com has been serving up CanCon (such as bilingual functionality) since 2012, but today, the LVMH-owned beauty mecca is unveiling site enhancements for the Canadian market—promising better, faster service. Orders will be fulfilled by a distribution centre in Brampton, Ont., which equals speedier shipping (one to five days on average, down from five to 12 days), free shipping for orders of more than $50 and free returns.
Although the 26,000-square-meter distribution centre has been stocking Canadian stores for a few years, it only recently became capable of handling .ca orders—an upgrade that required a major IT investment. As the site re-launches, Cosmetics spoke with Philippe Pinatel, SVP and GM of Sephora Canada, on the retailer’s competitive edge in beauty e-commerce.
How would you characterize the state of beauty e-commerce in Canada?
Philippe Pinatel: It’s definitely at an infancy stage. When we look at the breadth of pure players in the States versus what we have in Canada, we are absolutely not in the same category. And I will say, comparing Canada to the States is a bit more difficult because a big part of e-commerce is economy of scale, to justify the very big investment behind an e-commerce business. If we compare Canada to a country of its size—for example, Korea, or some countries in Europe—it’s still relatively lagging behind, especially in retail.
What inspired the re-launch of Sephora.ca?
Our new distribution center was the engine, but it was more about realizing we have opportunities to improve our client experience online—having faster shipments, free returns, no duties, and free shipping for orders over $50. We had to have a massive IT investment in order to have this distribution centre able to fulfill the .ca orders, so it [required] finding the time and money to do this change.
What gives Sephora.ca the competitive edge against other beauty e-tailers?
The number one advantage we have is the product assortment, and the fact that we’re able to find the next trendy brand, the next most technological brand, whether it’s in America, Asia or Europe, and bring the best of the beauty world to Canada. On Sephora.ca, we have more than 12,000 SKUs now, and every week we’re adding more brands, more SKUs.
Secondly, [the site is] a beauty community, so when you choose a product online, you have different points of view, and you can make up your mind more easily from the reviews and ratings. You also can join Beauty Talk, or learn from the videos we have on YouTube. We have a complete digital 360 that supports the e-commerce business, so it’s not only a site—it’s a learning tool. Our clients love this sense of community. They love being engaged in the beauty world, to be educated and to know what’s hot and new.
Are there products that people will only be able to get online, not in stores?
Yes, as a point of reference, we have 8,000 SKUs in stores and today 12,000 SKUs online. And we’re going to move to probably 15,000 SKUs [online] next year. And not only is it different brands, but also different shades of foundation and different textures. When we have a client base as diverse as we have in Canada—from deep skin tones to very light skin tones—it’s very important to be able to find the right shade.
[Compared to the U.S. market] we are definitely much more focused on servicing Asian clients, which are a much bigger [proportion] of our population. So for example, we are trying to find skincare products that have a lighter, more gel-type texture, which is a trend in Asia.
We also have different brands than in the U.S., because there are different clients to serve in Canada. I can’t break the news, but we’re going to launch some very important Asian brands in the fall that are not in the States.
What are the similarities and differences between Sephora’s online shoppers versus in-store shoppers, in terms of their demographic profile?
We have clients in their 30s and 40s, but the majority of our clients, whether online or in store, are millennials. The shoppers who go online are definitely our best clients because they love beauty and are always looking for information on Sephora.ca, on YouTube, on blogs and vlogs, for what’s new, what’s the trend… so they are very digital savvy and very engaged. [So the differences are more about] their level of engagement in the category than a different demographic.
They tend to be very urban as well. [In the past we thought] that .ca would be very good for servicing remote markets that do not necessarily have access to the same product assortment. But the truth is the best clients online are clients who are very urban, very digital savvy, and 360 in their digital and beauty life—on their mobile, on their desktop, and in the store.
In the past, there was an assumption that consumers would only shop online for product replenishment, but not to buy something they’d never tried before. So the Internet was not for product discovery. Do you agree with that?
I think the majority of clients still want to try product in stores and be inspired, but you have more and more clients who are purely digital savvy and do most of their shopping online. So I will say the statement is still overall true, but it’s changing very much. You’re going to have more and more young clients who were born into the digital world, and feel completely comfortable with reviews and ratings and blogger information and videos on YouTube, and will make up their mind based on these, and then will buy their product without being in a store.
What else can we expect to see from Sephora digital?
The beauty of our situation in Canada is we can leverage the Sephora.com team based in San Francisco. They are connected with all the new technology in Silicon Valley, so for example they launched Apple Pay in the States, and [payment] technology is something we’re also looking at for the future.
[Beyond that] we have a bigger opportunity overall in Canada to create “the eco-system,” and what I mean is having the site on desktop or mobile is only one part of the story. The second part is the ability to create content locally, on social platforms that will excite clients based on what is relevant for them locally, and this is where we are going to put much more investment and where we see great opportunity for the future.