Assignment Task
Sephora Direct: Investing in Social Media, Video, and Mobile
Julie Bornstein, senior vice president of Sephora Direct, glanced through Sephora USA Inc.’s (Sephora) latest set of social media metrics as she waited for the elevator in the lobby of her company’s headquarters in San Francisco, California. It was late in October of 2010, and she was heading up to the 32nd floor to meet with David Suliteanu, President and CEO of Sephora USA. Sephora was the largest prestige beauty specialty retailer in the world with nearly $2 billion of revenues from the company’s stores in U.S and Canada as well as the Sephora.com website. Started in Europe in 1969, the company entered the U.S. in 1998, selling a wide range of cosmetic, fragrance, hair, and skin care products. Sephora was known for its vibrant stores that encouraged trial and experimentation. As Bornstein stepped out of the elevator into the black and white striped hallway, she thought about the upcoming budget meetings with Sephora’s parent company, Louis Vuitton and Moet Hennessy (LVMH). The Sephora Direct group was responsible for all of Sephora’s direct marketing and digital initiatives, including Sephora.com and the Sephora Beauty Insider loyalty program. In 2008, Bornstein’s team began to experiment on Facebook and with online videos, and in 2009 the team began making plans for mobile applications. By the summer of 2010 Suliteanu had authorized the creation of a new group within the Sephora Direct organization to focus on these new initiatives. Bomstein was hoping to double her budget in social media, video, and mobile for 2011, and she wanted Suliteanu to back up her requests for close to an additional $1 million dollars of funding. Suliteanu conveyed that he would support more funding if Sephora could “win” in this space, but it was up to Bornstein to determine what winning would look like for the company. Along those lines, Bornstein was contemplating how Sephora should measure the success of its digital efforts.
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