It’s been a year of growth for Sephora Canada with more aggressive expansion expected in the near future.
The retailer recently opened its 100th store location at the Crossroads Station Shopping Centre in Winnipeg.
Since the opening of Sephora Canada’s first retail location in 2004, the leading omni-beauty retailer has rapidly expanded its brick-and-mortar presence across the country, with the goal of making its in-store experience accessible to the sprawling Canadian beauty community. In 2022 alone, the retailer opened 14 new stores in Canada, including flagship doors such as Sephora Toronto Union Station, the retailer’s first store inside a major Canadian transit hub.
Thomas Haupt, the newly appointed General Manager of Sephora Canada, said the new Winnipeg store opening is an important milestone for the company.
“Expansion and getting a physical presentation in more communities across Canada has been the number one focus for the team,” he said. “What’s interesting is we learned through the pandemic our online business like many folks . . . grew tremendously. What we’re happy to share is that as we came out of the pandemic we’ve seen (online) business maintain and our store traffic and store sales really tremendously grow.
“What we’re learning through our (online) business is we have a lot of consumers in homes and cities where we don’t have stores. So as we look forward, we’ve yet to say to say a number, we want to stop at X number of stores, but at this time we’re going to continue at least with 15ish new stores a year in the upcoming years as we find the right deals and the right locations to make that work.”
Haupt described Canada as a very wide and vast territory and when the retailer launched here in 2004 it was focused on the “obvious” cities – Toronto, Vancouver and Montreal.
“Over the last few years, the expansion focus has been reinforcing those markets as well. We have some work to do in Montreal. But getting outside of the major cities and outside what I would call the obvious malls,” he said.
“We’re now basically in every major, regional mall in every major city. We’re looking at the next level. Those suburb locations. We’re really interested in what we call a drive-on mall. So this is where you have, not an inside mall necessarily, it’s a line of stores or shops. You park out front. Sort of very convenient for you to run into your favourite store and set up stores.
“We’re finding great success in these drive-on mall locations that are in more of a neighbourhood setting and less of a big mall.”
Jeff Berkowitz of Aurora Realty Consultants represents Sephora for its real estate selection in Canada.
Haupt said about 5,000 square feet of retail space is the retailer’s sweet spot. But it does have stores as large as 10,000 square feet.
“We are exploring a new concept – a really smaller store concept that could be as small as 2,500 and 3,000 square feet,” he said, adding the intention is to get into more neighbourhoods.
“We have to be a bit more agile and flexible in what that looks like.”
He said the retailer is also interested in exploring more transit hubs after opening Union Station in Toronto this year which has been a “runaway hit.”
“We weren’t sure it was going to happen. We weren’t sure how the consumer who was clearly in transit would react to stopping at Sephora and interacting with us. It has been incredible. We have some work to do to refine the assortment as we learn what the client wants when they’re on the go a little more easily,” he said. “But even what surprised us is we have a very strong buy online, pick up in store . . . We didn’t think people in a transit mindset would have interest in that. It’s been incredible. They’ve absolutely embraced it.”
Haupt said there are a number of reasons why the retailer is resonating with Canadian consumers. First, 70 per cent of its brands are exclusive to it.
“That’s definitely I would say a competitive advantage to keep our loyal brand enthusiasts with us,” he said. “We also know a big driving reason to get into brick and mortar is the experience. So we hear from our clients all the time that they really appreciate what our beauty advisors, the folks that work in our stores, what they’re able to provide with expertise, with knowledge and with really directing. We really have two types of customers that come in. Those who are there and don’t necessarily want to be helped. They want to be part of that exploration process. I call it the hunt. They sort of walk in and as you see our stores, they’re a place where you can explore, and touch and feel and experiment.
“And then we have others who come in specifically looking for help . . . Since we’ve come back from COVID we’ve been recommitted to the welcoming greet at the door. What we hear from many clients because our store is so experiential and so grounded in you exploring, many people need help . . . Many people need some guidance. We have found that by having that sort of air traffic controller at the front not only does it help with the welcoming feeling . . . and it really has supported in giving clients great direction to head them towards where they might want to go.”
