Don't go shopping at Ulta until you read this

BY BRITTANY BROLLEY

While many brick and mortar stores are closing their doors, Ulta Beauty is one of the few companies that is actually thriving. Ahead of 2018, Ulta set its sights on opening a hundred new stores. Yeah, they're not messing around. But, if you're not an Ulta stan yourself, you may have a hard time understanding what the hype is all about. Step under those bright orange awnings, though, and you'll find an incredible array of nearly 200,000 products — from inexpensive "drugstore" favorites to high-end labels.

While rival beauty retailer Sephora may provide its customers with a more luxe shopping experience, that comes at a cost. Because the company mainly specializes in luxury brands, you won't be able to find the same range that Ulta offers. Ulta is the clear winner, according to Business Insider, when it comes to both overall selection and wallet-friendly products. Before you head to your nearest Ulta Beauty, though, there are some things you need to know.

They're not the Ulta you used to know

When the popular beauty retailer opened in 1990, the company went by the name Ulta Salon, Cosmetics & Fragrance Inc. In 2017, the company restructured and changed their name to Ulta Beauty Inc. "The primary purpose of the reorganization is to create a more efficient corporate structure," the firm told Women's Wear Daily. The core of the company, however, remained very much unchanged.

At the same time, though, Ulta has never gotten stale. The company embraces newness. Over the course of just one year, for example, Ulta launched 92 new brands. "It's a very competitive landscape, and we are hyper-aware of what our competitive set is doing," Monica Arnaudo, senior vice president of merchandising at Ulta Beauty, told Digiday. Staying ahead of the game means their stores have gone through some changes when it comes to aesthetics and product offerings, but that's a big part of why Ulta is thriving.

Say yes to Ultamate Rewards

It's true that Ulta reaps the benefits from their loyalty program, but, well, so do the customers. The free loyalty program allows shoppers to earn points for every dollar spent in Ulta stores. According to the company's site, 100 points equals a $3 discount, 250 points equals an $8 discount, and so on. However, you'll need to use 'em or else you'll lose 'em. If you spend less than $450 per calendar year, your Ultamate Rewards points will expire.

Being part of the loyalty program doesn't just earn you points, though. Ultamate Rewards members receive access  to additional discounts. When speaking with Fortune, CEO Mary Dillon explained how the company replaced their members-only coupon books with something a little more eye-catching — but kept the discounts we love. "It's not just price, but about product and teaching the customers about beauty," she revealed. And Dillon didn't stop there. She gave the Ultamate Rewards program a complete glow up, introducing "new perks like one that offers some items exclusively to members," according to Fortune. And the perks are great. Past freebies have included high-end products, like Urban Decay eyeshadow sets and customized Clinique foundation.

Go platinum

While all Ultamate Rewards members earn twice the amount of points during their birthday month — plus a free gift for getting older — platinum and diamond members get some extra goodies. To get to platinum status, you'll need to spend $450 per calendar year, according to Ulta's website. This may sound like a lot, but with the average woman spending $15,000 on beauty products throughout her lifetime, well, that figure starts to make a lot of sense. As a platinum member, you'll learn 1.25 points per dollar as opposed to just one. You'll also get a $10 coupon to celebrate your birthday and — the best part — your points will never expire. Hallelujah.

Shoppers who frequently buy luxury makeup may find it easy to reach the next level: diamond status. This is the highest level of the loyalty program and it requires an annual spending of $1,200. Gulp. If you can swing it, you'll get all the rewards that come with being a platinum member, plus free shipping on orders over a $25 and a $25 dollar gift to spend in a select area of the store. Not too shabby.

Take advantage of the free gifts

Being an Ultamate Rewards member isn't the only way to take advantage of free gifts. The company also frequently gives away gifts with the purchase of select products. As of this writing, Ulta is running 67 such promotions. From a free duffle bag with any $70 Issey Miyake men's purchase to a free Mini Dolly Lip Polish with any $25 Buxom purchase, there are plenty of freebies and price points to choose from.

There is a science behind why companies, like Ulta and DSW, give away free gifts with purchase. If a luxury item comes with a freebie, consumers tend to consider the free item to be of higher quality and are actually willing to pay more for the item by itself, according to a study published in the Journal of Consumer Research (via Time). Additionally, the Journal of Marketing reported that someone who receives a free product is more likely to talk about the company, thus boosting positive word of mouth. Okay, so what if we're suckers? Free stuff is still great.

Shop during one of their huge sales

The best time to shop at Ulta is during either their fall or spring 21 Days of Beauty Event. This semi-annual sale offers up some deep discounts on select products on each of the 21 days. Allure highlighted some of the best deals from the event that began in March 2019. On the first day of the event, you would've received 50 percent off Tarte Lights, Camera, Lashes Mascara, Lancome Cils Booster XL Mascara Primer, and Exuviance Performance Peel AP25. Throughout the rest of the month and into April, products from big brands like Benefit Cosmetics, MAC, Smashbox, and Urban Decay were similarly marked down. 

For Ulta beauty enthusiasts, the three-week sale is no joke. "Ulta's 21 Days of Beauty is my version of March Madness," one consumer tweeted. "BRB planning my life around Ulta's 21 Days of Beauty," wrote another beauty buyer. Same, girl, same.

Don't shun the store brand

Yes, Ulta carries the brands you know and love, but they also have their very own brand — and you might want to try it. In a vlog, Jessica Braun, makeup reviewer and YouTube personality, said the Ulta Beauty Collection's Full Coverage Liquid Concealer in the color Light Cool has become her "favorite concealer." She added, "High-, high-, highly recommend." She also said good things of the brand's Matte Eye Primer in Nude — and not based on its low price. Regardless of the cost, she said she would purchase the product. Of the eyeshadows in the Melissa Michelle palette, Braun said she was similarly and "genuinely super impressed." And Braun isn't the only one.

Some of the editorial team at Byrdie also tried some of the store brand products and were similarly impressed by Ulta's eyeshadows and primers. Thankfully, you can easily check out just what beauty products are part of the Ulta Beauty Collection and read consumers' reviews on the company's website to help inform your decision.

A home for both "prestige" and "mass cosmetics"

If you're not sold on the store brand, don't sweat it: You have about 499 other brands to choose from. Whether your budget is big or small, you have seemingly limitless options. You can find inexpensive brands like NYX Professional Makeup, CoverGirl, L'Oréal, and even the classic Wet 'n' Wild. Walk down a few more aisles, and you can also pick up your luxury staples from Dior and MAC.

It's this combination of high-end products — which Ulta calls "prestige" — and inexpensive items — i.e. "mass makeup" — that not only sets Ulta apart from other beauty retailers, but also mirrors consumers' shopping habits. "The fact that Ulta sells both categories in one location is a differentiator in the marketplace — it's how we shop today," retail analyst Jane Hali of Jane Hali & Associates, told Digiday. 

Monica Arnaudo, senior vice president of merchandising at Ulta Beauty, told the publication, "In mass cosmetics, it's been really interesting to watch, because you can see that what was transpiring on the prestige side has started to happen on the mass side. The industry is moving very fast, because the customer is moving very fast." And Ulta isn't falling behind.

Buy, try, return

One of the most daunting things about spending a lot of money on makeup is not knowing if you've picked the right shade. After all, you can only color-match so well in-store. Luckily, Ulta has what they call a "generous returns policy." They're not lying. In fact, HuffPost lists Ulta Beauty as one of the top four makeup stores with the best return policies.

Whether you've bought the "wrong shade" or picked up something that's "not right for your hair," Ulta says they'll allow you to return or exchange products for any reason within 60 days from purchase. This means you won't have to worry about encountering a problem when trying to return that slightly used eyeliner that was just a little too bold. Of course, Ulta revealed on their site that they reserve the right to deny a refund if they "suspect misuse" of their returns policy, like making "excessive returns" or fraudulent purchases.

Putting the rumors to rest

Can Ulta afford such a generous return policy because it resells the used returns? That's what a former employee alleged on social media. In a since deleted Twitter thread (via Fox News), the employee wrote that she and other workers "were told by managers to repackage/reseal the item and put it back on the shelf." She alleged that foundation would be cleaned up with a cotton swab and included a photo of a repackaged and new foundation for comparison. Other employees also chimed in with similar experiences. Eek.

According to Bloomberg, the allegation resulted in an 18-state lawsuit. In May 2019, the Shuman Law Firm announced their pending investigation into Ulta Beauty, but, as of this writing, there is no verdict. Nevertheless, Ulta Beauty categorically denies encouraging employees to resell used makeup. "Hearing from even one person alleging our policy is not being followed is one too many," the company revealed on its site. "We have zero tolerance for any actions that would compromise the integrity of the products we sell. Our policy does not allow for the re-selling of used, damaged or expired products."

A focus on wellness

In May 2019, Ulta Beauty introduced a new section called "Wellness" into 350 of its stores. By summer 2019, Ulta hopes to continue its foray into wellness by adding the section to an additional 350 stores. "There is a growing interest from the consumer — and this goes beyond the Ulta consumer — around what they are putting on their bodies, what they are putting in them and how to achieve overall beauty," Monica Arnaudo, Ulta senior vice president of merchandising, told Glossy. "This quest for wellbeing has evolved into beauty and self-care." 

Prior to the introduction of the Wellness section, the company hadn't experimented too much with wellness products. Nevertheless, they hope to see success. "It's a curated assortment, but also broad," Arnaudo explained. The new section is comprised of eight brands and about 80 products. "We knew it couldn't be intimidating and had to reflect our brand's personality. She added, "Our take is that it's beauty with benefits. The products feel approachable and accessible, whether you are somebody that is an expert in this space or somebody that is new to this segment."

Beyond beauty products

If you're not an Ulta regular, you may not have even realized that every store offers beauty services from haircuts to highlights to lash extensions. In 2016, Ulta's beauty services only made up five percent of the company's revenue. But, as The Washington Post highlighted, "A customer who comes six times a year for her haircut might start buying her cosmetics and haircare products there because it's convenient to do it in one fell swoop."

According to Fast Company, CEO Mary Dillon discovered that Ulta salon patrons were spending nearly three times as much as non-salon customers. Dillon then relocated the stores' Benefit Brow Bars, kiosks for eyebrow shaping, closer to the front of the stores in the hopes of enticing more shoppers to the company's beauty services. 

Ulta hasn't stopped in their quest for more. In February 2019, the company began allowing Ultamate Rewards members to redeem points on beauty services. You can certainly see why Dillon told Fast Company in 2017: "We're a 27-year-old brand that I feel is just getting started." It seems likely that Ulta will keep on changing, growing, and thriving.

More than just a pretty face

Behind the scenes, Ulta Beauty works to give back. A lot back. The company runs the Ulta Beauty Charitable Foundation, which, according to the company's website, helps women "obtain and maintain secure employment" through the foundation's Dress for Success program. "In addition to our financial donation, associates across our markets volunteer their time by sorting and inventorying suits for that crucial first interview, assisting on-site with special events or providing hair and makeup touchups to women clients," the company explained. The Ulta Beauty Charitable Foundation also runs the Associate Relief Program, which provides financial grants to Ulta employees affected by natural disasters.

In addition to running their own foundation, Ulta also partners with the Breast Cancer Research Foundation. Through donations from employees, business partners, and shoppers, the company has raised over $22 million since 2009 and continues to fund projects to cure, prevent, and treat breast cancer. Lastly, the beauty retailer also "believes in the importance of giving back to local nonprofit organizations that fit within [their] mission to inspire women and their families to realize their full potential." Whew. 

A women-led company

If you've been looking for ways to support more women-led companies, you should consider shopping at Ulta. As Fortune reported, Ulta Beauty's CEO Mary Dillon is one of the few female CEOS running a Fortune 500 company. Not to mention, she's also killing it. Since Dillon came on the scene, Ulta's stock has tripled. The company's annual growth rate has also climbed to 22 percent over the course of three years. 

"I've worked really hard for over 30 years," Dillon said of her success when speaking to Fortune. "I'm driven." That drive has certainly paid off. In 2018, Dillon was named a Fortune's Businessperson of the Year. However, Dillon isn't the only woman at the helm of the company. Half of Ulta's board of directors are women. The same is true of the executive team. And, of the company's 24,000 employees, 90 percent are women. 

Unsurprisingly, Ulta's CEO encourages all women to embrace their drive. "Too often women are told not to express that," she opined. "But if that's what you want, I think anything is possible. It's as simple as that."

All about the "beauty enthusiasts"

Back in 2016, Ulta recognized a need to open a grand total of 1,700 stores. As of this writing, Ulta has nearly 1,200 locations — so the company still has a ways to go. Even with a big expansion goal, though, Ulta isn't necessarily looking for just any ol' shopper. According to The Washington Post, the plan — as was understood in 2016 — was to focus much of their energy on "beauty enthusiasts." That is, not just people who buy makeup frequently, but those who like to try out new products. At the time, Ulta estimated that these kinds of shoppers made up 77 percent of spending in the beauty industry.

That's not to say Ulta didn't already love their loyal customers nor that their loyal customers didn't love them. According to the publication, research indicated that 77 percent of Ulta shoppers owned more than 11 lipsticks. Naturally, the company would love to attract even more beauty enthusiasts like this. And, thanks to their loyalty program, they have. By 2018, the program amassed 28 million members, according to Digiday, and that subset of people make up a whopping 90 percent of the company's sales. 

SOURCE: THE LIST