Ulta Beauty Wins Retail Innovator of the Year Award


In the world of omnichannel commerce, companies need to pursue innovation on a consistent basis in order to rise above the competition, deliver an outstanding customer experience and keep loyal customers coming back.

For the 2016 Excellence in Customer Experience Awards from Multichannel Merchant, recognized at the Operations Summit in Cincinnati, Retail Innovator of the Year was the one category not based on data from Radial’s SmartHub unit. Instead the MCM editorial team pored over many details of the finalist companies during a series of meetings, looked for innovations in technology, supply chain and inventory management – anything that led to an enhanced customer experience.

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While a strong case could be made for each finalist, Ulta Beauty eventually emerged as the Innovator of the Year.

WHY ULTA BEAUTY WON: In its quest to fulfill consumer demands from all channels, Ulta Beauty has initiated supply chain innovations that automatically and optimally replenish the stock in each store and ensure that its distribution centers have inventory available to fulfill consumers’’ anytime, anywhere demand.

The company has implemented a host of new IT tools, including new warehouse management, merchandise forecasting and replenishment systems, all supporting growth of its omnichannel sales. For UIta Beauty’s 15 million-plus loyalty program members, this means better access to products and in-stores services, more knowledgeable associates and an overall better experience.

Ulta Beauty has also become a leader in clienteling, in which retail sales associates have immediate access to customer buying behaviors and product preferences. Besides help associates build relationships with key customers, clienteling delivers a seamless view of customer activity in any channel and a clearer picture of inventory needs.

All of these innovations have contributed to Ulta Beauty’s financial success, including a 12.5% increase in Q4 2015 same-store sales, which improved to a healthy 15.2% gain in Q1 2016.

Here are the runners-up for Innovator of the Year, with a listing of their accomplishments:


Always an innovator, Amazon is changing the way customers order and what they order. Amazon Tap and Echo allow voice ordering — like Alec’s Baldwin’s cashmere socks — and Prime Pantry takes on the warehouse stores with a subscription-based business delivering heavy and bulky items for just $5.99. In terms of logistics, Amazon made a lot of noise by leasing 20 Boeing 767s and thousands of truck trailers to handle movement of freight within its network.


Jet.com is challenging both the warehouse stores and Amazon with its disruptive business model. It’s too simplistic to say that the more the customer buys, the more they save. Behind the scenes is an algorithm-driven dynamic pricing system that also helps drive sourcing, logistics and supply chain efficiency for sellers.


Lids’ Locate inventory system, which shows store and distribution center inventory in real time, has revolutionized the way product is shipped to stores and customers. Besides giving sales associates and customers access to an additional 50,000 SKUs, the Locate system manages whether products ship from the DC or a nearby store. The result has been increased sales and the ability to maximize sales versus shipping costs.


Target has been pushing an entire innovation agenda. It has been hiring top innovation talent, working with Silicon Valley entrepreneurs and tech accelerator programs, and even posting jobs for a mysterious project called “Goldfish.” Target’s execution of its omnichannel strategy showed great success in 2015. The retailer reported a 34% increase in digital sales in the fourth quarter of 2015, due in part to having a single view of inventory in store and the DC. With this view, Target was able to properly source and fulfill ecommerce orders, meeting customer demand and saving on shipping costs.

Mike O’Brien is Senior Editor of Multichannel Merchant

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