course purshasing
Case study: Sephora Direct: Investing in Social Media, Video and mobile.
Bus615
Case Set Up: History and Growth
* Founded by France Dominique Mandonnaud in 1969 as a simple perfume shop. * By 1979 the company was already expanded to “several stores” * Originally, Sephora was planned to be self-service store that offers a variety of products. * Its founder Mandonnaud rebranded his combined set of stores in order to expand is market. * Mandonnaud extended its branches all over France by acquiring 8% of total French retail perfume market and was purchased by LVMH, luxury product group, for $262 million in 1997. * Sephora expanded its operations and services beyond the perfume industry and expanding its core of products to cosmetics. * Under LNMH’s ownership and opened its first U.S store in New York City in 1998 However, this presented a challenge for the company as they had a difficult time to supply the products from other prestigious brands; such as Estee Lauder and Clinique. * The Company banked on rather unknown brands to fill its shelves therefore, these relationships grew strong and eventually this fact led to the innovation and creativity of these brands to introduce new lines of products. * Sephora confronted many issues on their cosmetic line division, especially with the direct line of supply from other stores. * Bottom line, Sephora offers more than 200 brands that go from the typical classics to new and exotic brands; altogether, Sephora counts with more than 20,000 products. Among those products we could find top of line and sophisticated brands as well as not so well know products. * Sephora formed an strategic alliance with JC Penny. * Sephora.com was projected to generate 15-20% of Sephora USA sales in 2010. * Sephora.com ranked top 50 retail sites in U.S
SWOT analysis
Strengths * Globally distributed with more than 1000 shops worldwide * Strong parent company; LVMH *
Bus615
Case Set Up: History and Growth
* Founded by France Dominique Mandonnaud in 1969 as a simple perfume shop. * By 1979 the company was already expanded to “several stores” * Originally, Sephora was planned to be self-service store that offers a variety of products. * Its founder Mandonnaud rebranded his combined set of stores in order to expand is market. * Mandonnaud extended its branches all over France by acquiring 8% of total French retail perfume market and was purchased by LVMH, luxury product group, for $262 million in 1997. * Sephora expanded its operations and services beyond the perfume industry and expanding its core of products to cosmetics. * Under LNMH’s ownership and opened its first U.S store in New York City in 1998 However, this presented a challenge for the company as they had a difficult time to supply the products from other prestigious brands; such as Estee Lauder and Clinique. * The Company banked on rather unknown brands to fill its shelves therefore, these relationships grew strong and eventually this fact led to the innovation and creativity of these brands to introduce new lines of products. * Sephora confronted many issues on their cosmetic line division, especially with the direct line of supply from other stores. * Bottom line, Sephora offers more than 200 brands that go from the typical classics to new and exotic brands; altogether, Sephora counts with more than 20,000 products. Among those products we could find top of line and sophisticated brands as well as not so well know products. * Sephora formed an strategic alliance with JC Penny. * Sephora.com was projected to generate 15-20% of Sephora USA sales in 2010. * Sephora.com ranked top 50 retail sites in U.S
SWOT analysis
Strengths * Globally distributed with more than 1000 shops worldwide * Strong parent company; LVMH *
References: Ofek, E. (2012). Sephora Direct: Investing in Social Media, Video, and Mobile. Harvard Business School.