Dive Brief:
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Ulta Beauty reported that Q4 same-store sales rose 11.1%, up from 9.2% that quarter a year ago. E-commerce grew a stunning 55.2% year over year.
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Total Q4 sales rose 20.7% to just over $1 billion, from $868 million year over year.
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Ulta opened 100 new stores in 2014 and 123 in 2013, for a total of 774 locations to date. The retailer plans 100 new stores this year, which will bring total sales in the mid-teens range, same-store sales growth of 6% to 8%, and e-commerce growth of 40%.
Dive Insight:
Ulta has benefited from its new loyalty program, making the investment worth it despite its cut into gross margins. The retailer, like Sephora, sells beauty products in accessible store setups compared to the out-of-reach department store approach. Unlike Sephora, the retailer includes lower-cost makeup and beauty products, which brings in teens and others with less money.
“Ulta Beauty wrapped up a very strong year of sales and profit growth with an excellent fourth quarter, which we are proud to celebrate as our first billion dollar sales quarter,” Ulta CEO Mary Dillon said. “Our best comparable sales increase of the year was driven by accelerating traffic growth, continued strength in prestige and mass color cosmetics, a successful holiday selling season, execution of more effective marketing and CRM strategies, a double-digit comp in our salon business, and a 55% comparable sales increase in our e-commerce business.”
