Sephora has unveiled the details for the first stage of its reentry into the UK market. The LVMH-owned beauty retailer made its debut in the UK in 2000 with a location at the Bluewater Mall in Kent, but closed all nine of its stores in the market just five years later. With 3,000 stores in 36 countries, Britain was one of the few major markets where Sephora did not have a presence.
Sephora bought Feelunique from private equity firm Palamon Capital in a deal rumored to be £132 million last year, setting the wheels in motion for a return to the UK market. At the time of the transaction, Feelunique's merchandise assortment included 35,000 products from 800 brands, and they were shipping more than 18,000 products a day with 1.3 million active customers.
"We are delighted to bring Sephora to the UK, responding to Britain's strong demand for our unique prestige beauty experience," said Sephora Chief Executive and Chairman Chris de Lapuente.
On October 17, Sephora will initiate its reentry into the British market when Feelunique's website becomes Sephora.co.uk. Upon the Sephora takeover, brands such as Sephora Collection, Tarte Cosmetics, Skinfix, Ilia, One/Size by Patrick Starrr, and Gxve by Gwen Stefani, among others, will be available in the UK for the first time. Feelunique's reward program will stay in place, but will be renamed, with customers receiving £5 off for every £75 spent, as well as other benefits.
Sephora has plans to open a flagship store in a yet-to-be-disclosed location in London in March 2023, inclusive of the in-store beauty expertise and experiences that have made the retailer successful in North America and other markets.
While Feelunique may give Sephora a leg up on launching in the British market this time, they will face stiff competition. Walgreens-owned Boots has a physical footprint of 2,200 stores across the United Kingdom and Ireland, ranging from local pharmacies to large health and beauty shops and increasing its reach into the premium beauty segment, adding brands like Armani Beauty, MAC, Nars, Anastasia Beverly Hills, and Kylie Cosmetics. Boots claims to have over a 40 percent market share for skin, makeup, and premium beauty, with the category making up 50 percent of sales on Boots.com, having grown 125 percent in the last two years.
Manzanita-owned Space NK has been the destination for both established and emerging brands as the only specialty beauty retailer in the market since 1993, with a footprint of 70 stores in the UK and Ireland. Last March, the retailer opened a new 2,000-sq-ft two-story location in London's Covent Garden and plans to open in the new Battersea Power Station this fall. Online Sephora will face competition from UK-based Cult Beauty and Lookfantastic, part of the THG portfolio.
"We come to the UK very humbly," Sylvie Moreau, the retailer's President of Europe and the Middle East said. "It has one of the most engaged, experienced consumer. It's a big battleground."
UK beauty market expert Stirling Murray, Managing Director of The Red Tree predicts, “Despite the gloom hanging over the economy the UK will continue to have a dynamic beauty market and in many ways Sephora’s timing is perfect. The growth of stand-alone beauty stores - H, Flannels Beauty Edit, Next - is advancing and changing shopping habits. The traditional “heavy” multi-floor shopping format of department stores is now except for flagships, in terminal decline. Sephora with its superb own product portfolio, welcoming shopping experience and relatively small scale stores will fit perfectly into this new retail structure. Sephora will take share from across the breadth of retailers from mass to prestige and it won’t, like 17 years ago, fail this time.”
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