- Ulta Beauty is opening new stores while many other retailers are closing them.
- One reason for Ulta's success is that it carries both luxury and drugstore brands, allowing it to appeal to shoppers on a variety of budgets.
- Rival beauty store Sephora, on the other hand, focuses on stocking luxury brands.
- We went to an Ulta and a Sephora to see how the two stores stacked up against each other.
While many other retailers close their doors, Ulta Beauty reportedly plans to open at least 100 new stores in 2018.
According to CNBC, the beauty retailer is entering new markets, adding stores in existing markets, and remodeling old stores to stay relevant. Ulta carries upwards of 500 brands, ranging in price from $3 to more than $100, which is nearly double what luxury beauty rival Sephora carries. Since its stores offer a full suite of beauty services, Ulta competes not only with other beauty retailers, but with drugstores and salons as well.
Another reason Ulta is seeing success is that 90% of its locations are in suburban strip malls instead of enclosed shopping malls, meaning that it isn't heavily affected by the ongoing decrease in shopping mall foot traffic.
Sephora has more locations in shopping malls than Ulta, though it's taking action to move out of malls and open smaller locations, called Sephora Studios, to supplement decreasing mall traffic. It's also bringing in more exclusive product releases and running programs such as Sephora Accelerate, a beauty startup accelerator.
To see how Ulta and Sephora stacked up against each other, we visited both stores back to back. This is what we found:
My first stop was Ulta. The only Manhattan location is on the Upper East Side, right next-door to a Sephora.
The inside was bright, and the employees were all very bubbly. A Benefit Cosmetics promotion was advertised in the entryway, with high-end cosmetics to the left and drugstore brands on the right.
I started making my way through the more affordable side of the store. It had a huge display of the popular brand NYX cosmetics, which is generally available in drugstores and online.
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