The Pandemic Creates Unlikely Friends: 3 CX Reasons Ulta And Target Teamed Up

This is part of LinkedIn's new Newsletter Series. For weekly customer experience content hit the "subscribe" button above.

Two popular retailers are joining forces to create the ultimate power couple. This week, Target and Ulta Beauty announced their partnership to put shop-in-shop Ulta stores in 100 Target stores next year. The move connects two stores with enthusiastic followings to create a powerful data program. 

Complimentary Companies

On paper, few people may have put Ulta and Target together. But the unique partnership is good news for both stores because it allows them to share access to their customers and digital tools. Ulta gains access to Target’s large and loyal customer base without having to build more physical stores—a huge cost savings and a way to tap into a younger and more budget-conscious demographic that has been hard for Ulta to crack. Target will train its employees to staff the Ulta shop-in-shops, which boosts Target’s profile as a beauty brand and supplier. 

Although Ulta and Target generally compete in two different arenas, they share the same view of customer experience. Both stores focus on creating personalized experiences for customers, both in store and through digital and mobile. With that foundation, the brands have the potential to come together to create innovative experiences that go beyond typical store experiences. 

Combining Digital And In-Person Retail

In the modern shopping age, the mix of digital and in-person shopping is critical to brands. Unfortunately, most companies don’t do both well. Some brands excel in e-commerce and others thrive in the brick-and-mortar space, but it’s rare to find companies that are great in both areas. Target is the rare exception. 

Target is often cited as a strong example of digital transformation (I’ve talked about it multiple times). By blurring the line between physical and online shopping with a variety of delivery and pickup options, Target has been able to weather economic changes and stay top of mind for customers. The partnership with Target puts many Ulta products on Target’s website and app, which will likely fuel Ulta’s own digital transformation. 

While Target has seen tremendous growth during the pandemic, largely due to its ability to quickly pivot and leverage its innovative digital solutions, such as mobile ordering and drive-up pickup. At the same time, Ulta has struggled. The beauty industry as a whole has seen decreased sales with people staying home and not needing to purchase as much makeup. But the new partnership expands Ulta’s reach into digital, which is crucial during uncertain times. 

Why now for the partnership? The brands are leaning in to the many changes in retail due to the pandemic. The changing retail scene has caused stores to evolve, which provides opportunities for brands to think outside the box. The bold, innovative move could resonate with customers who are already looking for change and focusing on convenience. Combining two favorite brands offers convenient options for millions of customers. 

Customer Loyalty

Target and Ulta each have some of the strongest customer loyalty programs in all of retail. Target Circle has more than 75 million members, and Ulta’s Ultimate Rewards boasts more than 30 million members. These programs have shined where many others have struggled for a number of reasons. First, they are easy to use, especially on mobile and digital. The loyalty programs also offer great rewards, such as discounts and free samples, which is a huge incentive to customers. 

By combining their digital resources and customer data, Target and Ulta have the potential to build a powerful data program that offers hyper-personalized experiences and product recommendations. Both stores have shown that they can attract loyal customers. By joining forces and leveraging data, they can take their already successful loyalty programs to the next level. 

The partnership between Ulta and Target will be a boost for both companies as they combine resources, tap into each other’s strong customer bases and leverage both in-store and digital offerings. A new wave of retail partnerships could follow, especially as stores try to grab the attention of loyal customers.

________________

Blake Morgan is a customer experience futurist, keynote speaker and author of the bestselling book The Customer Of The Future. 

Sign up for her new course here:

Did you enjoy this article? To get regular updates on upcoming content, be sure to do the following:

? Sign up for the weekly newsletter here to get updates on customer experience, digital transformation, and more.

? Follow Blake on LinkedIn, Twitter, Facebook, and YouTube.