Sephora Teardown: Beauty Insider

Sephora Teardown: Beauty Insider

Beauty Insider is well-liked by Sephora customers thanks to the effective use of tiers, rewards that are consistent with the brand, and tailored product recommendations.

Sephora: The Beauty Insider


One of the most well-known rewards programs in the retail and ecommerce loyalty communities, as well as one of the most talked-about loyalty programs in retail, is Sephora's Beauty Insider Program. This program is consistently included among the greatest loyalty programs because it gives members access to promotions, extra benefits via store credit cards, special promotions, and discounts. But what is it about the VIB program that makes it stand out from the competition?

“We are driven by what our customers love and want more of. So it’s not about what their loyalty demonstrates to us, but what we can deliver to our clients that creates the most meaningful and connected experience with our brands,” Sephora VP of Loyalty, Allegra Stanley.


“The way we think about loyalty is that our clients are the core of everything we do”, Stanley says.


The Journey So Far


The free Beauty Insider program was created to give members free samples of specific items in exchange for purchases when it was first introduced in 2007. Because it allowed customers access to luxury beauty brands and items they ordinarily wouldn't have or be aware of, it was fresh and unique. A new tier known as "Very Important Beauty Insider" was then added to the program in 2009. This was only available to the most active members who spent more than $350 annually. 2013 saw the addition of a third category (called Rouge) for those customers who spend $1,000 or more annually. It provided early access to brand-new items, restricted editions, and invites to exclusive events. In 2016, an exclusive Rewards Bazaar was established as a platform for members to exchange points for a variety of carefully chosen products and sets.


Continuing the progression of the Beauty Insider Program with greater savings and more samples, but more crucially, Sephora expanded the experiential component of the program with its most recent update, which was released in May 2020. “The wants and needs of our clients continue to change,'' Stanley says. “We are listening to our clients and hearing what is most meaningful to them.” And in the modern era, those are the experiences that offer more emotional and lasting rewards. As of May 29th, the Beauty Insider Cash program allowed users to convert their reward points into cash; 500 points were equal to $10. The update added multiplier events, meet-and-greets with notable company founders, free sessions, facials, and experiential prizes like these, as well as new rewards on the feature Reward Bazaar. Additionally, it offered free shipping to Insider and VIB members on orders above $50 and $35, respectively.


The latest iteration also includes a feature for charity donations, via which points can be donated to organizations including Coalition and Project Glimmer, which aid teenage girls in need, and National Black Justice, which works with the Black LGBTQ community.


An In-Depth Look at What Makes it Special


The Emotional Factor


According to research, emotional benefits account for roughly 75% of what influences customer engagement and loyalty. Customers choose to interact with brands more often than ever based on emotional loyalty factors. Success of Sephora's loyalty program is more strongly correlated with social and emotional factors. Unlike emotionally driven loyalty, which has a deeper and more powerful influence and provides long-term advantages, incentive-driven loyalty operates on need and greed.


An exclusive community is given a sense of inclusion by Sephora. Additionally, it customizes its benefits and incentives to create a strong rapport with each member. After carefully examining consumer purchasing history and product preferences, free samples or birthday presents are carefully selected.


There are 17 million members of the Sephora Loyalty program in North America alone. 80% of sales are driven by those loyalty program members, who also provide the company's brand powerful, organic publicity. Even when customers aren't shopping, they drive them to the Sephora website thanks to their loyalty program. People are encouraged to spend more money thanks to this brand engagement, which also boosts customer loyalty.


An Effective Use of Tiers


Sephora has managed a very effective approach to tiers. Members have something to strive for by having many membership tiers, each of which comes with its own set of benefits. It rewards both Sephora and their VIPs when members spend more to advance to higher tiers and receive the exclusive rewards. Members of the lower tier always strive to move up the tier ladder due to the competitive nature of the tier system (and eventually end up spending more than anticipated). In addition, Sephora started offering higher tier members more options for their birthday surprise starting in 2019: either a rotating gift that changes monthly or an extra 250 points.Customers have still added motivation to strive to advance to the next tier thanks to this perk.


Exclusivity and Unique Rewards


Members of Sephora's top tier receive special benefits like access to limited-edition items and free entry to master classes led by well-known makeup artists from across the world. The ownership of a Sephora membership card is highly prized among make-up aficionados. For aspiring cosmetics fans, Sephora offers top-of-the-line items and is a one-stop store for exceptional makeup brands.

Giving customers experiences like this will raise awareness of your brand. Your visitors will be eager to tell their friends and family about the event. By sharing their positive interactions with your brand, your devoted customers will inevitably become brand ambassadors.



Conclusion


Success of Sephora's loyalty program is more strongly correlated with social and emotional factors. According to research, emotional benefits account for roughly 75% of what influences customer engagement and loyalty. Customers choose to interact with companies more often than ever based on emotional loyalty factors. The reward program at Sephora has many components that contribute to its success both in-store and online. Beauty Insider is well-liked by Sephora customers thanks to the effective use of tiers, rewards that are consistent with the brand, and tailored product recommendations.