Sephora is reportedly boosting its online presence in China, opening a branded storefront on e-tailer JD.com and it for exclusive releases and new product launches.
The move is unprecedented in the history of Sephora, as the brand has always controlled its online and physical distribution. Since 2008, Sephora has attracted consumers to its site with reviews, the Beauty Talk forum, and a mobile app with wallet and loyalty program integration. So why change the strategy in China?
China has been a challenging market for Western beauty brands, which Sephora has fared well in. In L2’s China Beauty study, Sephora was ranked 3rd and Genius among 84 global and local brands with two million fans voting for its Beauty Awards and collecting coupons on the campaign microsite. However, Sephora was missing a share of the B2C market by not being present on e-tailers. JD.com has more than 39.6 million active users, trailing just Tmall at 95.26.
E-commerce accounts for more than 15.3% of Beauty sales in China, and brands are responding by making expanding DTC e-commerce. As shown in the graph below, 48% sell on Tmall and 33% sell on their brand site. Sephora will join the 13% that sell on both.
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