Ulta Beauty is taking strategic steps to enhance its digital presence and introduce a new eCommerce marketplace. The company faces increasing competition in the beauty industry and aims to strengthen customer engagement by expanding digital capabilities. Under the leadership of its newly appointed CEO, Kecia Steelman, Ulta Beauty is focusing on personalization, automation, and streamlined shopping experiences. In addition to growing its core business, the retailer is making structural changes to support these initiatives.
Ulta Beauty has previously expanded its digital services and introduced innovations aimed at improving customer experience. However, 2024 marks a shift as the company reported a loss in market share within the beauty sector for the first time. This contrasts with earlier years when Ulta consistently outperformed competitors in beauty retail growth. The new digital enhancements and marketplace launch reflect an effort to regain ground and maintain its position in a changing market.
How Is Ulta Beauty Enhancing Digital Engagement?
The company is working on upgrading its app and website by integrating new features that provide a more personalized shopping experience. Automation and real-time content improvements are being implemented to increase customer interaction across digital platforms. These updates are designed to keep pace with evolving consumer expectations and industry trends.
Steelman highlighted the importance of adapting to shifts in the market, stating,
“The beauty landscape is fundamentally changed. Guest expectations continue to rise, and the pace of change is accelerating. The competitive environment in beauty has never been more intense.”
Ulta Beauty is prioritizing speed and efficiency in implementing these changes to strengthen its customer engagement strategy.
What Will the New Marketplace Offer?
Ulta Beauty is launching a curated marketplace to broaden its eCommerce reach. The platform will operate on an invitation-only basis, allowing select brands to sell through the retailer while maintaining a controlled product selection. This initiative will provide customers with access to a wider assortment of beauty and wellness products.
Customers will be able to earn loyalty points on marketplace purchases and return items in physical stores, creating a seamless shopping experience. Steelman addressed this initiative, stating,
“So, we’re trying to make this as seamless as possible for our guests. The plan is to launch this in the back half of 2025, and we’ve got a dedicated team that we’re building around selling and operations to operate this model.”
The company has also restructured its leadership team, introducing new roles such as chief retail officer and chief technology and transformation officer to guide this expansion.
Steelman assumed the CEO position following Dave Kimbell’s retirement, though he remains an adviser through mid-2024. Having been with Ulta Beauty since 2014, Steelman has played a key role in shaping the company’s operations and strategic direction. The retailer remains confident in the beauty sector’s resilience, with Steelman noting,
“The consumers are navigating a dynamic macro environment, but we continue to expect the healthy consumer engagement with beauty. While the category did slow in 2024, it continued to grow in the low- to mid-single-digit range.”
Ulta Beauty’s initiatives indicate a strong focus on digital transformation and marketplace expansion. By emphasizing personalization, automation, and an expanded product assortment, the company is addressing competitive pressures. While these efforts could help Ulta regain lost market share, execution will be key to their success. The curated marketplace model may provide an advantage by offering exclusive product selections, but consumer reception will ultimately determine its impact. The broader beauty industry continues to evolve, and Ulta Beauty’s ability to adapt will influence its long-term positioning.
