Ulta Beauty SWOT and PESTLE Analysis

Strength

1. Offers world class beauty assortments: The wide assortment provided by Ulta beauty is the center of its value proposition. It is the core differentiator which differentiates Ulta Beauty from other service providers. The offerings are based on innovation and leading trends, differentiation and exclusivity and speed to market. A typical Ulta Beauty store carries more than 25000 products from approximately 500 well-established and emerging brands across all categories and price points. The brands include MAC, Bumble and Bumble, ULTA beauty, MORPHE, REVOLUTION, ESTEE LAUDER , ANASTASIA and many more. Guests can find all the products that they need with over 500 brands being offered which eliminates the need to go to multiple department stores, specialty stores or salons as they can now find all this in one place. Ulta Beauty continuously upgrades and enhances the offerings provided which incudes broad array of categories, brands and price points which helps it to appeal to a wide range of consumers of all ages, demographics and lifestyles.

2. Strong beauty digital engagement through omnichannel strategy: Ulta beauty strives towards building industry leading digital experience for better customer experience. To increase customer engagement, it uses a multifaceted approach to actively communicate, engage and transact across all channels with the customers. It creates visual and immersive digital experiences and seamlessly merges content and commerce to make the beauty shopping experience fun and interactive. Apart from store expansion, Ulta beauty’s ecommerce platform also plays great roles in attracting and retaining customer. These omnichannel guests are extremely valuable since they spend nearly 3 times as much as retail only guests. So, it continues to develop and add new website and mobile features functionality and omnichannel integration points so as to enhance the customer value. For this, it provides a rich online experience to the guests by providing information on key trends and products, editorial content, interactive experience and many more.

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Weakness

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Opportunity

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Threats

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Political

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Economic

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Social

1. Emerging new patterns of personal consumption: As far as makeup and beauty is concerned, customers these days are increasing their interest towards convenience. They want the products immediately and don’t want to spend much time waiting for the product. They also demand the product to be shipped at their location. They want products which would be easy to use. Customers are also demanding personalization in the products that they use. It should be relevant and resonate with their personality and should be curated specifically for them. Customers are also focusing on experience. They need to be continuously engaged through personalized touchpoints like instore associates, mail, SMS, services etc.

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Technological

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Legal

1. Lawsuits alleging violations of California’s wage and hour laws. In 2018, people had filed lawsuits against Ulta against violations of several laws of California. Ulta was alleged to ask its employees to submit to security checks and other tasks beyond the work timings. Ulta was also accused to not provide timely meal or rest breaks to the non-exempt employees which was required under California law. The plaintiffs also claimed unpaid overtime, unpaid minimum wages, failure to provide meal periods or rest periods, failure to provide real time wages or accurate wage settlements. Such accusations were then settled in a Federal court in 2020 where Ulta was asked to pay $1.75 million and the settlement covered 23767 members.

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Environmental

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