We are the largest beauty retailer that provides one-stop shopping for prestige, mass and salon products and salon services in the United States. We focus on providing affordable indulgence to our customers by combining unmatched product breadth, value and convenience with the distinctive environment and experience of a specialty retailer. Key aspects of our business include:
One-Stop Shopping. Our customers can satisfy all of their beauty needs at Ulta. We offer a unique combination of over 20,000 prestige and mass beauty products organized by category in a bright, open store environment. The beauty products are arranged in self-service displays and full-service boutiques in a way that encourages our customers to enjoy discovering new products and services. We believe we offer the widest selection of categories across prestige and mass cosmetics, fragrance, haircare, skincare, bath and body products and salon styling tools. We also offer a full-service salon and a wide range of salon haircare products in all of our stores.
Our Value Proposition. We believe our focus on delivering a compelling value proposition to our customers across all of our product categories drives customer loyalty. We offer frequent promotions and coupons, in store events, gift-with-purchase offers, a comprehensive customer loyalty program and targeted promotions through our Customer Relationship Management platform.
An Off-Mall Location. We are predominantly located in convenient, high-traffic locations such as power centers. Our typical store is approximately 10,000 square feet, including approximately 950 square feet dedicated to our full-service salon. Our store design, fixtures and open layout provide the flexibility to respond to consumer trends and changes in our merchandising strategy. As of February 1, 2014, we operate 675 stores in 46 states.
We were founded in 1990 as a beauty retailer at a time when prestige, mass and salon products were sold through distinct channels - department stores for prestige products, drug stores and mass merchandisers for mass products, and salons and authorized retail outlets for professional haircare products. We developed a unique specialty retail concept combining a one-stop shopping, a compelling value proposition, convenient locations and a welcoming shopping environment.
Our Competitive Strengths
We believe the following competitive strengths have differentiated us from our competitors and are critical to our success:
- Differentiated merchandising strategy with broad appeal – we believe our broad selection of merchandise across categories, price points and brands offers a unique shopping experience for our customers.
- Our unique customer experience – we combine unmatched product breadth, value and convenience with the distinctive environment and experience of a specialty retailer. Our well-trained, non-commissioned beauty advisors provide unbiased and customized advice tailored to our customers’ needs. Our customer service strategy, convenient locations and attractive store design combine to create a unique shopping experience.
- Loyal and active customer base – approximately thirteen million Ulta customers are members of our loyalty program. We use this valuable proprietary database to drive traffic, better understand our customers’ purchasing patterns and support new store site selection. We regularly employ a broad range of media, including digital, catalogs and newspaper inserts and targeted promotions driven by our CRM platform, to drive traffic to our stores and website..
- Strong vendor relationships across product categories – we have strong, active relationships with over 300 vendors. We believe the scope of these relationships, which span the three beauty categories of prestige, mass and salon and which have taken years to develop and create a significant impediment for other retailers to replicate our model. We work closely with our venders to market both new and existing brands in a collaborative manner.
- Experienced management team – we have an experienced senior management team that brings a creative merchandising approach and a disciplined operating philosophy to our business. We continue to expand the depth of our management team at all levels and in all functional areas to support our growth.
We intend to expand our presence as a leading retailer of beauty products and salon services by pursuing the following primary growth strategies:
- Growing stores to approximately 1,200 locations
- Adding new products, brands and services
- Expanding our offering by adding new products, brands and services
- Broadening our marketing reach
- Expanding our digital business