Name: Ulta Beauty CEO “optimistic” about holiday sales despite turbulent economy
Uploaded: 2022-12-20
Duration: 9 min 12 s
Description: Dave Kimbell says a partnership with Target and a more diverse offering are driving sales momentum.

Dave Kimbell says a partnership with Target and a more diverse offering are driving sales momentum.

Ulta Beauty CEO “optimistic” about holiday sales despite turbulent economy

Leadership

Ulta CEO “optimistic” about holiday sales despite economy

dave so great to meet you and to talk about Ulta beauty and you know, we've seen that your company has strong business results on black friday. And then again on cyber monday to kick off the holiday shopping season. Well now we are in peak season. How's business going right now? You're right. We're right in the midst of the holiday season, our biggest time of the year. And as we shared on our recent earnings call, we're feeling really good about the momentum that we see as we enter into this holiday season. Conf consumers have always treated holidays as a time to both gift and glam. And the beauty category plays an important role in that gifting for sure, for loved ones. And we're seeing strong adoption and engagement across our portfolio and then glamping in this year, more than ever as people are out and about and enjoying holiday parties and other events with friends and family. So we're encouraged by the results. We have a lot of ground still to cover but optimistic about the consumer engagement that we're seeing. We all know that the holidays are the most important time for retailers, including for all to but it's also a time right now, that's for cautious spending. I mean, what's your take on consumer attitudes about spending money on whether it's a beauty or fragrances when it comes to presence. No doubt that this is a disrupted time consumers are dealing with a lot as we come out of the pandemic and then face face high level and inflation and other pressures in the world around us. But what we know about beauty is it's resilient and it's important to our consumers lives. It's an emotional category that makes it one that is able to navigate disruption. And we're seeing that now and we feel both through the holiday and as we look in 2023 the core beauty category will continue to be healthy. Tell us about the partnership between alta and Target. You've opened nearly 350 alta shops and shops stores inside of Target. How's business going with this concept? Well, Target has, it's been an exceptional partner and what we built is really differentiated. It isn't just taking an all time, put it in a target. It's creating a customized, unique, differentiated experience that allows the target shopper and the older beauty of targeting consumer to discover products in ways that they never have before. It's off to a great start. We're about a year into it. We're expanding more next year. Uh and our guests are really responding well, so we're excited about it and feel like it's a great way to further disk And evolve the beauty category and and deliver a great experience for our guests. What has surprised you about this partnership? Well, it is really powerful. Target has 30 million people that walked through a target every single week. And so gave us a great opportunity to reach a whole new audience, but also at the same time serve our existing guest in in an in a new and incremental way and so far, what we're seeing is they're really responding face, They're shopping across every category. They're discovering new products to add to their baskets and and so far we're really pleased with how it's working together. Well, it sounds like your strategies are working when it comes to the financial results at all to the company reported just recently, double-digit sales and earnings. And you told investors that you're expecting to increase revenues as much as 8% by the end of this year. Does that momentum carry over into the new year? Well, we're very optimistic about the long-term future of of all the beauty and as we look into 2023 there is for sure, a high level of uncertainty but we're really confident in our business model and the experience that we deliver every day and the power of of our team and so what we shared is we do believe there's going to be growth ahead of us. We believe it will moderate somewhat from the from the strong growth we saw this year, but we we believe will will settle into what we identified a little while ago as our long term growth algorithm of 3 to 5%. I'm sure you see all the forecasts about a recession for next year. How could a recession impact these plans that you're talking about your growth trajectory. I've been working in this category for a long time and I guess I could say there's more uncertainty as we look into 2023 than any year that I've experienced just given everything that the consumer has been facing these last couple of years. But what we do know is the category is entering into 2023 and a position of strength. There's a deeper connection between beauty and wellness and self care that we think serves well. And we see consumers typically see beauty as important to their emotional wellness as well as just an affordable luxury. So yes, we're watching, we're thinking carefully about how to best manage through an uncertain environment, but we optimism that the category will be able to navigate it. Well, Dave your predecessor mary Dillon recruited you eight years ago to be Delta's Chief marketing Officer. And then you moved on to be chief merchandizing officer and then you were promoted to president. And together you two transformed alta into this powerful growth company. Well now you're the ceo what are your plans to put your stamp on the company? I will say I learned so much from mary in her time here and my career working with mary and at at multiple different places And and so what that ultimately comes down to me is this idea of leading with heart leading with care and compassion and then surrounding that with a clear focus on delivering for our guest, strong teamwork, bold action and so as I look forward and think about the stamp that I want to put on our company, It's continuing strong leadership. But having our team reflect on alta as just a great place to work and one that they feel valued, respected and excited to come to work every day and I feel like I can keep doing that our business results will deliver. You've also made diversity and inclusion a top priority at all. So I understand that you've increased spending for Black led beauty brands, latin brands and supporting entrepreneurs of color. What are your goals? I'd start by saying That inclusivity is important for every every company I would argue. But it's particularly important in the beauty category because beauty is fundamentally about self expression about how each individual chooses to bring themselves to life to the world around them. And if you think through that lens that means it has to be inherently inclusive because every individual is unique and how and how they choose to express themselves. We make commitments this year, spending $50 million dollars across the four key pillars. One is just amplifying uh diverse voices, underrepresented voices through all of our marketing and communication efforts. And we've done a lot of that too is our assortment. We've doubled more than double the number of black owned brands. We're bringing in latin X founder asian american founders to make sure our assortment is representative of the of our consumers. Third is the experience that we deliver in stores, so we've invested more in training our associates to sure they're ready and fourth is our team and make sure that our team represents the world around us. And I'm pleased that our company is over 47% people of color. So we have a really good, really good foundation of diversity and it's about expressing that to the world and that's that's our mission and our vision. And you also brought in Tracy, Ellis, the actress and entrepreneur as altars diversity and inclusion advisor. What did she say? And what did she do? And what did it accomplish? Well, she's been a great partner. She has a brand with us pattern that's been an exceptional partner on that. But then as as a lead uh partner for us in our D and I efforts, she was there to really just help help us think bigger and bolder and to be disruptive to bring a different voice in as a brand founder and certainly an influencer in so many ways. So she's really been there to challenge us, but more importantly to partner with us. And I just, I'm so grateful to have her her voice and her experience on our side and uh, and really have had a great experience with her. So how would you describe how diversity and inclusion looks like in alta, after a year of making all of these moves are marketing or communication through what we call our muse program has has come to light in new and exciting ways, both in store and outside of stores and our team. Our team is reflective, even more reflective of the world around them and the focus on the training and the top of mind connection that that we have in making sure that we're delivering experience that's reflective of our values I know is showing up. I see it every time I'm in our stores and so I'm really proud of what we're doing, but I know there's more work to do and and I personally lead this effort and I'm focused on making sure that we drive this well into our future.