Sally Beauty’s Digital Transformation Marches On with Focus on Emerging Brands

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Sally Beauty’s Digital Transformation Marches On with Focus on Emerging Brands

By Lisa Johnston - 10/28/2020
Peculiar Roots, a brand dedicated toward locs and natural hairstyles, was one of the winners of Sally Beauty's Cultivate Cohort accelerator program.

Sally Beauty certainly picked the right time to align with DIY.

The hair and beauty retailer and distributor launched a new brand campaign at the start of the year aimed at helping consumers achieve salon results from the comfort of their home. Although many changes focused on brick-and-mortar store upgrades, it also laid a foundation that’s serving it well during today’s extreme consumer behavior shifts.

At the beginning of the retail shutdowns in the spring, the company’s No. 1 priority was to focus on its customers and create innovative and safe ways to shop both online and in-store, Pam Kohn, Sally Beauty senior VP and chief merchandising officer, told RIS News. As such, it quickly implemented curbside pickup and call-in ordering for contactless shopping.

Its mobile app, meanwhile, provides access to such things as its ColorView technology, so consumers can experiment with hair and makeup products and receive product recommendations via artificial intelligence and augmented reality.  

Sally Beauty, which sells and distributes through more than 5,000 stores around the world, is determined to hone its focus on today’s beauty and haircare trends, and Kohn credited the company’s agility as positioning it to gain share during a disrupted environment. Although the company’s consolidated net sales were down 27.7% in its most recent quarter to $705.3 million, affected by the widespread store closures, it reported $137 million in e-commerce sales — an increase of 278% over last year.

“We will continue to invest in our digital transformation, take advantage of the strong demand for our key categories, adapt quickly to any new local restrictions or changes to consumer shopping behavior tied to the pandemic, and stay disciplined in terms of cost and cash management,” said Kohn.

As part of this, it’s expanding its retail beauty products to Canadian consumers via increased e-commerce capabilities on the recently launched Sallybeauty.ca. This also includes more ship-from-store distribution points to shorten delivery times. It also launched its first credit card program tied to loyalty rewards.

The UniQurl brand, another Cultivate Cohort winner, develops products for kinky curls.

Sally Beauty also bolstered its leadership team earlier this month with the addition of Frances Lukban, VP of content and media strategy; Mindy Torrey, VP of creative; and Dorothy Jones, VP of category and field marketing.

Among its efforts to stay connected with customers and the brands it sells is its Cultivate Cohort accelerator program. The program, now in its second iteration, was developed in support of female-owned beauty brands and entrepreneurs.

“There is so much hair and nail care innovation happening every day in women's homes, salons and communities, and we want to encourage that innovation to thrive and grow,” Kohn said.

This year’s winners included UniQurl, with products developed for kinky curls; True + Pure Texture, a line of luxury hair extensions; Peculiar Roots, a brand dedicated toward locs and natural hairstyles; and Pattie Yankee Products, a line of nail art products.

“The Cultivate program saw an overwhelming response of applications focused on natural hair care, signaling that it’s time to help meet the unique needs of the often-underserved textured hair consumer,” she noted.

Winners are selected on such factors as product assortment, brand story, revenue and supply chain capabilities, and they receive distribution and business grants worth a combined total of $60,000. They also participate in a four-week “virtual boot camp” focusing on merchandising, social media, marketing, e-commerce, store operations and entrepreneurship.

Winners will subsequently present to senior-level Sally Beauty executives at a pitch event for a chance to receive in-store distribution in select locations. 

In plotting its go-forward strategy, the company remains focused on both its continued digital transformation and initiatives like Cultivate. “In the current climate, DIY and self-care are more relevant now than ever,” Kohn said. “We’re continuing to serve our customers by executing our brand mission to boost confidence, provide educational content and build trusting relationships.”  

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