The Beauty of Integrated Loyalty

What comes first – the chicken or the egg? Tough one. But when it comes to Ulta Beauty, it’s pretty obvious that the 40 million active loyal members (people who purchased within the last 12 months) who drive more than 95% of their sales came?after?the brand worked to create an unmatched value proposition.?

One based on brass tack consumer insights about what?consumers?value. Convenience. Price points. Assortment. Experience. Celebration.

I think of their success as based on 5 ‘integration’ pillars that hold everything up.?

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5 Types of ‘Integration’: Lessons from Ulta Beauty

1. Integrating with the business?

Ulta has a loyalty culture, which means everybody owns loyalty, says?Nicole Bernhardt, the Head of Ultamate Rewards .?Loyalty is embedded into the product?and?the experience, with?the Ulta Beauty and Ultamate Rewards value propositions closely aligned.??

Business KPIs are driven by ‘transactional, receipt level’ data (items like basket value and member tenure) but also by ‘program engagement’ data, which tells them what features of the program are actually being used, and how members derive value from it.?

The 95% ‘member sales penetration’ metric speaks to the strategic importance of the program to the business. It is respected and supported by the C-suite and every team – from logistics to finance, seen as a brand and business differentiator, and discussed (and celebrated) in every earnings call.?

2. Integration with partners

External partners help expand the network of earning and redemption possibilities for Ulta members. But thanks to nifty co-branding, consistent messaging, and ease of sign-up and use, it’s easy to believe it all comes out of one office.?

For instance, the?Ultamate rewards program ?is supported by an ‘in-house’ credit card to earn and burn within the Ulta system. The?Beyond Ultamate Rewards? with Mastercard offers more range in terms of where a member can earn and redeem points, including at partner brands.?

The credit card and loyalty program concepts are closely integrated and seen as a multiplier and accelerator of loyalty.?

3. Internal integration with associates

More than 55,000 field associates in 1300 stores stand at the forefront of the loyalty program?and?the CX.?

They are trained not just in how to deliver the brand and loyalty value proposition to the customer, but also in the value a loyal customer brings to their store and to their own success.?

A team works full-time to engage these associates and get the field dynamic right. The playbook is all about engaging customers with meaningful experiences – not just in the rewards, but in everything from?product discovery to checkout and promotions.

4. Cross-channel integration

A seamless experience, be it a mobile app, website, or in-store ensures that the brand and the program follow every shopper’s unique but non-linear journey. The loyalty program, says?Bernhardt ,?is the key to delivering those seamless experiences because of the rich data it delivers.?‘Personalized experiences’ are a broad spectrum – as simple as addressing a customer by name to as complex as serving the right product recommendation at the right moment on the right channel. The business model, powered by macro and micro-level data, is built to handle such ongoing consumer shifts across the breadth of products and propositions, on any channel.?

5. Integration into the members’ life

Salons, credit cards, partner stores like?Target? mini-stores, and more. The Ultamate Rewards program factors in all the key aspects of the consumer’s life to create value.?

Products, services, payments – everything people may want is available within the brand. The reality is beauty can be anything from health and wellness to cosmetics and hair care rituals – the program is designed to work through that range of needs and create value at multiple points.

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Get the full episode here:Ultamate Rewards from Ulta Beauty – A Key Differentiator in a Competitive Sector

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About the Author

Chitra ?is an experienced marketer turned freelance B2B content creator. She writes about CX, martech, sales tech, ad tech, retail tech, loyalty tech, and customer data and privacy. Of her two-decade-long career, Chitra spent the first half in senior corporate marketing roles in India. She’s led communications, digital marketing, and marketing ops teams for companies such as Timken Steel, Tata Play Satellite TV, and Procter & Gamble (P&G).

She has served as the editor-in-chief for the pioneering martech site Martech Advisor, which she led through a successful acquisition by?Ziff Davis . She also conceptualized and co-hosted three seasons of one of the earliest Martech podcasts, The Talking Stack, with renowned Martech experts?David Raab ?and?Anand Thaker .

As a freelancer, Chitra creates original, thought-provoking content for senior B2B audiences, and has authored over 500 articles, white papers, ebooks, guides, and research reports about Martech and CX for?clients around the world . She writes monthly columns for CX publication?CMSWire ?and HR tech publication?Reworked ; and teaches a course on freelance B2B content writing in association with the?Himalayan Writing Institute ?in India.

Chitra holds a Master’s in global media & communications from the?London School of Economics and Political Science , and an MBA in marketing from the?Institute of Management Development & Research, India .

In 2011, Chitra opted out of the city and moved to a farm in rural Punjab, in the north of India, where she and her husband breed thoroughbred race horses, grow organic food, and homeschool their two boys.