While most Ulta shoppers begin their excursion at the store with mass products, eventually, prestige products account for 60% of average spend at the store. Prestige brands should consider Ulta distribution for this reason alone, as the masstige e-tailer can be used as the gateway drug for prestige products.
Ulta encourages the migration to prestige with policies that encourage additional purchase and bigger baskets with receive discounts. For example, in the 21 Days of Beauty event that ran from March 19 to April 8 in 2017, the retailer offered 50% off three featured product each day. These doorbuster deals – e.g. Anastasia Beverly Hills Brow Wiz Pencil for $10.50 instead of $21 – encourage users to try the prestige products they were eyeing. Open rates for these types of emails surpassed 23%, signaling shopper enthusiasm for trying new products.
Furthermore, weekly Ulta coupons offer discounts for minimum purchases. Its weekly $3.50 off a purchase of $15 or more encourages users to splurge on higher priced products or purchase more than one item. Brands that want to avoid diluting their products can do so; Clarins, LVMH brands, Puig and The Estée Lauder Companies exclude their products from weekly discounts.