The ultimate Ulta Salon, Cosmetics & Fragrance, Inc (NASDAQ:ULTA) business strategy

Posted by Ryan Mandell June 13, 2013 0 Comment 1010 views

Ulta Salon, Cosmetics & Fragrance, Inc (NASDAQ:ULTA) topped its quarterly earnings projections. On Tuesday, ULTA has risen by 14.87% and closed at $96.64 per share.

Its Q1 earnings rose to $41.8M or $0.65/share from $34.9M or $0.54/share in the same period in 2012.There was a 23% jump in sales, to $583 million. Comparable store sales rose by 6.7%. The average analyst projections were earnings per share of $0.62 on a 21.60% sales growth. Gross profit shrunk by 100 basis points to 35.0%.

ULTA said that it expects to inaugurate around 32 stores in the Q2, 55 stores in the Q3 and 15 stores in Q4 of 2013. All ULTA stores have a footprint of 10,000 sq ft and all are owned by the company. There are no franchisee plans in the pipeline.

Beauty business sense

Before ULTA came into the picture, beauty products could be bought only via salons and department. Since 1990, when ULTA was founded, the company has launched affordable beauty products that are easily accessible outside the walls of salons and department stores. The company is also now channelising its marketing efforts via E-commerce. Though online selling was uncharted territory for the company it realises that the internet offers unlimited potential.

All that it needed was the right partner to position and launch the company’s products in an optimal manner. The Director of E-commerce at ULTA, Kevin Metz decided that partnering with ChannelAdvisor for the company’s paid search as well as comparison-shopping campaigns would be a wise decision.

What is paid search and comparison shopping?

ChannelAdvisor’s Paid Search solution essentially takes the basics of the channel and super-charges them exclusively for retailers. What this means is that, it’s now possible, practical and cost-effective, to manage, automate as well as maximize visibility of a company’s campaigns right across prominent search engines such as Google, Yahoo and Bing.

Comparison shopping sites allow consumers look at the broader picture. ChannelAdvisor’s Comparison Shopping solution affords retailers the same functionality.  It offers them the ability to view the entire landscape and market their products across various sites effectively and easily. By opting to have ChannelAdvisor work on its online marketing, Ulta Salon, Cosmetics & Fragrance, Inc (NASDAQ:ULTA) will be able to focus on its most-persuasive campaign strategies.

About Ryan Mandell

Ryan Mandell is our senior staff writer covering the White House for Political Report, Ryan also coordinates with the main newsroom news items and contributing write-ups on cultural, social and political activities. Ryan holds an undergraduate degree in journalism, a Doctorate in international relations and a Master Degree in mass communications with an emphasis in print journalism. Ryan also covered the International Society of Social Defense congress in Spain in 2007 and taken part in the Global Forum on economic policies

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