Sephora personalizes beauty

Iconic brand powers 82 live experiences with Dynamic Yield, achieving 6x ROI
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Sephora case study header image
82
Live Experiences powered by Dynamic Yield
6X
ROI from PDP Recommendations

Introduction

Amidst a “retail apocalypse” where shoppers are abandoning iconic brands for generics and fast fashion, Sephora is thriving due to a steadfast commitment to providing the best customer experience. To create the hallmark personalized in-store experience Sephora shoppers receive online, the beauty retailer turned to Dynamic Yield to personalize product recommendations, optimize digital channels for easy discoverability and craft a cohesive experience across channels. Just six months after implementing Dynamic Yield, Sephora implemented 82 live experiences through the platform with PDP recommendations alone yielding a 6X ROI.

Sephora logo
“With Dynamic Yield, Sephora customers can seamlessly find the right products for their beauty needs. Personalisation is at the core of our eCommerce strategy and partnering with Dynamic Yield allows us to craft truly customised shopping experiences across all touch points.”
Alexis Horowtiz-Burdick, Managing Director
The Challenge section thumbnail

The Challenge

To craft online and mobile experiences that capture the magic and convenience of a Sephora store, the beauty retailer required a solution to:

  • Quickly surface the right products for each individual user.

  • Break free of long development cycles and rapidly implement website changes.

  • Guide wayward users back to the path of purchase.

  • Optimize the checkout flow for seamless conversion

  • Connect online and offline channels to power one cohesive customer journey.

That’s when they turned to Dynamic Yield.

Execution

Deployed personalized PDP recommendations powered by machine learning
To help users seamlessly find the most relevant products, Sephora focused on optimizing PDPs across eight markets in Asia. In each country, users were shown recommendations based on three distinct strategies: similar items, bought together and automatic.

Since the most successful recommendation approach varied by market and KPI, Dynamic Yield’s adaptive recommendations crunched the data and deployed the highest performing strategy in each market, based on users adding items to cart and completing a purchase.

Dynamic Yield’s recommendation engine powered a CTR of more than 4%, ultimately returning direct revenue in excess of $6.50 for every $1 spent with Dynamic Yield. As a result of the massive revenue uplift and development time saved, Sephora now serves recommendations powered by Dynamic Yield to 100% of website traffic.
Deployed personalized PDP recommendations
powered by machine learning
Served “no search” result recommendations to move user back into purchase funnel
When a user searches a product page and sees no results, she is likely to leave the website without making a purchase, falling right out from the middle of the conversion funnel. To avoid this scenario, Sephora used Dynamic Yield to populate a “no search result” with relevant recommendations based on user context.

Depending on website behavior, users were either shown recently viewed items or a sample of Sephora’s most popular products. This strategy paid off, driving more derived pageviews against a control group and 30% add to cart rates for returning visitors across all markets.
Served “no search” result
Optimized checkout messaging to drive loyalty sign-ups
To boost membership in the “Beauty Insider” program, Sephora tested two variations of copy (only served to users who were not already members) testing both sign-ups and revenue per session.

Variation 1 performed definitively better in several countries, Variation 2 performed best in Australia and variation performance was dependent on audience segment in some markets. Sephora used the flexibility of Dynamic Yield’s optimization platform to tailor experiences accordingly by manually directing traffic in markets where there was a clear winning variation while relying on automated optimization to deliver the best results in markets where performance was mixed.
Created unique experience for visitors on store location page
While the store location page contains essential information for shoppers, it can often be a “dead-end” page. To decrease bounce rate from customers looking for store location, Sephora reimagined the page as a step in the online buyer journey.

The retailer used Dynamic Yield to personalize the page with targeted banners highlighting popular information such as gift cards, popular items and rewards membership info. Incorporating this banner drove more clickthroughs to product and loyalty pages and ultimately, higher engagement from users exposed to this experience.

The Key Takeaway

For decades, companies have framed the customer experience in terms of touchpoints- the individual transactions where customers engage with a business. But as channels disappear, savvy brands like Sephora are focusing efforts on the customer’s end-to-end journey, which often occurs across analog and digital.

To achieve true end-to end journey personalization, Sephora is beginning to integrate CRM data with Dynamic Yield. By onboarding this transaction history, Sephora can serve individually tailored online experiences based on past in-store purchases. With unified offline and online data, a shopper will be able to visit Sephora, have fun trying on makeup until she finds exactly the right look, and ultimately receive concierge online experiences with recommendations that match her style.

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