Our new season kick-off episode features an illuminating interview with Ulta CEO Dave Kimbell. Ulta has become one of the most remarkable growth stories in all of retail, growing from a small regional player to an $8 billion powerhouse with more than 1,300 stores and an expanding presence within Target. Dave discusses the brand's evolution and some of the keys to their success, including a relentless focus on the customer (instead of channels), the importance of human-connection and story telling and why physical stores remain critical to their growth strategy.
Our new season kick-off episode features an illuminating interview with Ulta CEO Dave Kimbell. Ulta has become one of the most remarkable growth stories in all of retail, growing from a small regional player to an $8 billion powerhouse with more than 1,300 stores and an expanding presence within Target. Dave discusses the brand's evolution and some of the keys to their success, including a relentless focus on the customer (instead of channels), the importance of human-connection and story telling and why physical stores remain critical to their growth strategy.
But first we give a shout-out to each other and many of our friends and past podcast guests who were named to ReThink's Top Retail Influencer list. We then take on the big retail news from the past week starting with the monthly US Commerce Department Retail sales data, which were very strong despite many misleading headlines. We also discuss Walmart's new wholesale partnership with two buzzy digitally native brands.
About
Dave was named Chief Executive Officer in June 2021 after having previously served as President since December 2019, Chief Merchandising and Marketing Officer since March 2015 and Chief Marketing Officer since February 2014. Prior to joining Ulta Beauty, he served as Chief Marketing Officer and Executive Vice President at U.S. Cellular, Chief Marketing Officer of Seventh Generation, Vice President of Marketing at PepsiCo, and held a number of brand management roles in the Beauty Division of The Procter and Gamble Company from 1995 to 2001. Dave currently serves on the board of directors for Big Brothers Big Sisters of Metropolitan Chicago and Chicago lights, and is a member of The Economic Club of Chicago.
October 2021 Ulta Investor Day Presentation
About Us
Steve Dennis is an advisor, keynote speaker and author on strategic growth and business innovation. You can learn more about Steve on his website. The expanded and revised edition of his bestselling book Remarkable Retail: How To Win & Keep Customers in the Age of Disruption is now available at Amazon or just about anywhere else books are sold. Steve regularly shares his insights in his role as a Forbes senior contributor and on Twitter and LinkedIn. You can also check out his speaker "sizzle" reel here.
Michael LeBlanc is the Founder & President of M.E. LeBlanc & Company Inc and a Senior Advisor to Retail Council of Canada as part of his advisory and consulting practice. He brings 25+ years of brand/retail/marketing & eCommerce leadership experience, and has been on the front lines of retail industry change for his entire career. Michael is the producer and host of a network of leading podcasts including Canada’s top retail industry podcast, The Voice of Retail, plus Global E-Commerce Tech Talks , The Food Professor with Dr. Sylvain Charlebois and now in its second season, Conversations with CommerceNext! You can learn more about Michael here or on LinkedIn.
Be sure and check out Michael's latest venture for fun and influencer riches - Last Request Barbecue, his YouTube BBQ cooking channel!
Michael LeBlanc 00:05
Welcome to The Remarkable Retail podcast season four, episode one, our debut episode.
Steve, welcome to 2022. How are you doing my friend?
Steve Dennis 00:15
I'm doing well it's, it's pretty amazing well, it's amazing we made it to a new year in general but season four, I guess we're like, what 60 episodes in or something?
Michael LeBlanc 00:24
Yeah.
Steve Dennis 00:24
Something like that, it's exciting.
Michael LeBlanc 00:27
Yeah, our little venture that could is, you know, I am will-, and thank the listeners and take this opportunity to thank all the folks and listeners and supporters. You know, we've had great response and, and I particularly also want to thank our guests, our guests are so important. So, it's so important in the mix. Scott Galloway, our last speaker, we closed on a super strong note with Scott Galloway, and we're going to be starting kicking off with a super strong note as well. We got Dave Kimbell, CEO, Ulta, joining us for our, our first ever first kickoff episodes. So, very excited that's a little later in the show.
Let's jump into the first part of our sequence. First of all, high fives to you, I guess me, and all the, the amazing folks who are on the Rethink Retail, Top List of Global Influences it is a fantastic list. I think we're going to poach a few of those folks for, for our guests. You know, the, the folks there are sponsored by Microsoft this year, congratulations on getting Microsoft involved. Powerhouse of thought leadership. So again, congratulations to everyone who's been on the list.
Steve Dennis 01:29
It's definitely nice to, I guess this is the second year, that we both been on it, which is very nice to, to be recognized.
Michael LeBlanc 01:35
Yeah.
Steve Dennis 01:35
I was really struck by how many people on the list have been guests on the podcast, it gets close to, close to 20. So, that -
Michael LeBlanc 01:45
Yeah.
Steve Dennis 01:45
That's kind of fun to see, as well as just people that. that we know, and have known for, for quite some time. So, it's, it's -
Michael LeBlanc 01:51
Yeah.
Steve Dennis 01:51
Nice to be able to, it's nice for everybody to get recognized. It's nice to see some of the newer folks get on -
Michael LeBlanc 01:55
Yes.
Steve Dennis 01:55
The list this year. So yeah, congrats to everybody.
Michael LeBlanc 02:00
I was, I have to say, though, I was a little modeling about when I was looking at the pictures and names. You know, I was so looking forward to seeing everyone in New York City at the NRF Big Show. I was looking forward to you know, catching up with all our friends and colleagues, and you,
Steve Dennis 02:17
Mostly me,
Michael LeBlanc
I mean, not to mostly (inaudible). Let me, let me restart that pyramided down, you.
Steve Dennis 02:22
That’s right, priority, Steve, everybody else.
Michael LeBlanc 02:26
But you know, it was not to be, not for you, not for me. Little bit as I said, there's a lot of friction getting them back and forth across the border. So, we wish NRF and everyone who's going there the best of who's there today, right?
Steve Dennis 02:37
Yeah.
Michael LeBlanc 02:38
And I just want to do a quick shout out, I'm doing a bunch of bonus episodes for The Voice of Retail, with quick short interviews with a whole bunch of folks just because I wanted to support them and the NRF. And you and I are planning on doing something for NRF, we'll talk about that next episode, as well, just because it is a big event. Lots of people come together.
Alright, let's jump in. Let's jump into the deep end here. Let's talk about what we want to talk about before our great to interview with Dave. US Commerce results came out. We were recording this on Friday, they just they're hot off the press. Weird positioning, we've talked about this before, share your thoughts.
Steve Dennis 03:13
Well, yeah, the, the thing we keep talking about is this focus, obsession, whatever, with the month over month numbers. And, you know, I'm just finishing up a Forbes piece so that will be posted by the time this comes out. You know, I don't know anybody really, outside of the media and a few, kind of investor types that focus on the month over month numbers.
Michael LeBlanc 03:57
Yeah.
Steve Dennis 03:35
So, what the report said was that December sales were down relative to November, which is a little bit unusual. December is usually a bigger month than November. But I think because of the sales moving earlier, because of all the fears about supply chain and retailers promoting, and then Omicron starting to be a factor towards-
Michael LeBlanc 03:35
Yeah.
Steve Dennis 03:57
The end part of December was not terribly surprising. But as I think you would agree, most people that I know focus on the year over year numbers and -
Michael LeBlanc 04:08
Yeah.
Steve Dennis 04:09
It turns out, they were phenomenal. So, this headline of like this big disappointment. Whoa is me, the sky is falling is actually just about the exact opposite-,
Michael LeBlanc 04:19
Yeah.
Steve Dennis 04:19
Of what one should conclude. Sales depending on which classification, we were talking about this off mic. There's some that include restaurants, and some include gasoline. But if you look at core retail, which strips out auto, strips out gasoline, strips out restaurants, the year over year numbers were up like 17% in the US -,
Michael LeBlanc 04:37
Yeah.
Steve Dennis 04:37
And December is, this past December was the all-time biggest December in the history of retail. So anyway, I think that there's just really a misinterpretation. So, I take them on in my Forbes piece. I will say though, to put a little bit of step on the brakes a little bit. They’re clearly being some signs of moderation based upon Omicron, based upon supply chain challenges, so you can look at it and say, you know, and inflation and worker shortages and shortening hours I mean, there definitely are some things to say, oh, this a phenomenal amount of consumer spending looks to be moderating a bit. But in terms of on an absolute basis, fantastic month, retail had a fantastic year, you know kind of all time record sales, all time record increases. So yeah, just a weird take.
Michael LeBlanc 05:34
Yeah, I mean, two quick comments. One, I've been trying for many years, both in my, what I do here, and of course, as part of Retail Council of Canada to get the, the media off this Chicken Little platform, which is, oh my God, the month over month numbers. I mean, they are just not sensical. I don't seem to be making, I've been trying, I've been working on that for years, maybe your Forbes year article to a bunch of people.
Steve Dennis 05:54
I'm sure my, my Forbes article will totally change everything in retail for the foreseeable future. Yeah, I've got that covered.
Michael LeBlanc 06:01
(Crossover talk) headlines.
Steve Dennis 06:02
I mean, I am a top 100 influencer so -
Michael LeBlanc 06:04
You are, you are a top influencer.
Steve Dennis 06:05
(Crossover talk) in the cloud. Yeah.
Michael LeBlanc 06:07
Let's see how much influence you got my friend, maybe the two of us together were like,
Steve Dennis 06:10
Yeah.
Michael LeBlanc 06:10
One plus one.
Steve Dennis 06:11
Joint forces (crossover talk).
Michael LeBlanc 06:12
At, let's talk about the composition of this sales. Let's talk about foot traffic, because you know, your comments about December I was thinking eCommerce, you know, bigger than smaller. What have you seen around the foot traffic? What kind of numbers are you looking at?
Steve Dennis 06:26
Well, you know, we saw, I'd say relative to last year, I believe the numbers show that there was an increase in foot traffic during the holiday. But down, compared to two years ago, so the, so called two-year stack. So that's, that's a little bit confusing. I think it's certainly hard to say that physical retail is completely back to where it was pre pandemic. But we continue to see pretty much improving trends. And we're also seeing this rebalancing, I know we've talked about this a few times where -
Michael LeBlanc 06:59
Yeah.
Steve Dennis 06:59
eCommerce sales rates are coming down, but they're coming down compared to an incredible increase and overall, there's been an acceleration. So, we still got kind of these weird mix issues, both across category as well as kind of the digital versus physical component. And, and foot traffic has definitely been moderating last few weeks with, with Omicron.
Michael LeBlanc 07:21
Yeah, yeah and by the way, congratulations to our friends at Placer.ai. They had some nice news on the financing side. So, they did a great raise. So, congratulations to Ethan and the team at Placer, so I just wanted to throw that in.
So, let's, let's transition to okay, you know, I'm sorry, we still have to be talking about this whole COVID thing. I was hoping you know we wouldn't talk about it that much. But we should talk about the uncertainty.
Steve Dennis 07:43
(Crossover Talk) it's like in Florida, if you don't test it, it doesn't exist.
Michael LeBlanc 07:47
It doesn't exist.
Steve Dennis 07:48
If we don't talk about it, it It's also, it also disappears.
Michael LeBlanc 07:52
All right, I love that strategy, it'll just go away. In, in lieu of that happening, you know we should talk about its influence on things like store hours. And you know, I've seen numbers like 25% of associates on any given day not available. I mean, it's really creating, creating a bit of havoc. What are you hearing? I mean, we see some, some folks issuing some warnings out some softening numbers. What have you read?
Steve Dennis 08:16
Yeah, I mean, it's certainly something to be con-, to be concerned about. Various retailers have basically been talking about their, their expectations for 2022, at least the first part of 2022, being more muted. Lululemon, Bed Bath and Beyond and their earnings statement, so, Bed Bath and Beyond is a little different situation. But they, they basically were saying we, we expect to have some challenges, largely due to COVID related issues. Macy's, I think Apple, Nike, a bunch of other major retailers are cutting back their store hours to try to deal with the shortage of labor. So, I think certainly for a bit here, you know, I'm out of the, I try to get out of the predictions business, when it comes, comes to COVID. But it certainly looks like we've got several more weeks of this Omicron surge, and that's, that's just going to take X percent, you know, is it 10, -
Michael LeBlanc 09:07
Yeah.
Steve Dennis 09:07
is it 20%? Okay when I did some calculation that at any given time in the US, if you, you know, generally take the numbers of cases as well as assume there's a bunch of cases that haven't been reported, either because they were home tested or because asymptomatic people don't get tested, but they're still contagious. You've got a pretty good amount of people that you know, 3% or something in the US population’s got COVID and is contagious at any given time. You layer on top of that people that might be exposed that are quarantining, and you've got, you've got a lot of people at any given time that are out of the workforce. So that's, that's definitely going to put a lot of pressure on store operations, you know, at least until February.
Michael LeBlanc 09:48
Anyway, any anything else you want to add before we wrap up? We, we can I see that you know, we see Walmart adding billing enrollment to the stores, I mean, digital natives going to wholesale legacy brands, all kinds of different stuff going on. (crossover talk)
Steve Dennis 09:59
You know in the interest of time, I, I think one of the I did think it was interesting that Walmart last week announced Billy, the shaving products and others that are kind of the female version of Harry's and Dollar Shave Club. They are going -
Michael LeBlanc 10:13
Yeah.
Steve Dennis 10:13
To be distributed through, through Walmart. And Roman the men's health care products, as well. And I think it's a continuing trend of these digital brands and needing to have a physical presence, in this case through a wholesale relationship. So, really a much more traditional kind of CPG approach to retail.
Michael LeBlanc 10:33
Right, right.
Steve Dennis 10:34
Of which, you know, we've been predicting for a while, I don't think it's terribly surprising. But I think from the retailer perspective, as we've also touched on a couple of times, you know, how do you as a big retailer get differentiated product in your stores? And so these relationships are not exclusive, exclusive, but semi exclusive, which I think gives Walmart a point of differentiation, maybe get some new or different traffic through the door. So, I expect we will continue to see these sort of alliances as, as part of the playbook as, as the year goes on.
Michael LeBlanc 10:35
Well, it's a great segue to our interview with Dave from, from Ulta because we'll be talking about that and many of the things. The beauty industry has changed so much, you know, from, from direct, to the mass merchant roll to the drugstore roll and Ultas’ just such a great story. So, let's, let's jump in right now. And let's get Dave on the mic and, and kick off our first interview of 2022 and season four.
Steve Dennis 11:29
Well, Michael and I are delighted to welcome Dave Kimball to the podcast. Welcome, Dave, how are you today?
Dave Kimbell 11:36
I'm doing great. Thanks for having me and I'm looking forward to a great discussion.
Steve Dennis 11:41
Well, your, your company is one of the most exciting stories in retail. So, we're very excited to dig into that in just a second. But what we usually like to do is just have the guests give us a little bit about themselves and their personal journey in the work they do. So, if you won't mind starting there, and then we'll delve into some of the exciting things going on at Ulta.
Dave Kimbell 12:00
Absolutely. Well again, thanks for having me. Yeah, just briefly, I, I am from the Midwest, grew up in Indianapolis, and my first job was actually in Indianapolis in banking and commercial lending, but decided that wasn't where I wanted to you know focus my career. So, after business school I made the shift into consumer businesses, mostly on the CPG side first at Procter & Gamble in Beauty, Didn't know then that my career would circle back to beauty but spent about five or six years in Beauty at P&G, which was just a great place to learn and, and, and understand the importance and power of beauty and, and, and marketing and consumer connection.
Then a number of years at Pepsi and in Chicago, spent some time in Burlington, Vermont at a cool company, Seventh Generation, a small independent company at the time that’s doing some pretty interesting things in sustainability.
I came back to Chicago and really got into retail, for the first time direct into retail. But in, in the mobile space at US Cellular we have about 1000 stores across the, the country and, and learned a lot through the lens of, of mobile.
But then made the leap full into retail when I joined Ulta Beauty eight years ago first, you know leading marketing and then merchandising and eCommerce and, and our loyalty program, store design, all really all aspects of our consumer business. And I love it. And I've been I was fortunate enough to have the opportunity to step into the CEO role here last June, so a little over six months ago, and I couldn't be happier. The best, best time in my career for sure. And, you know, we're really optimistic and excited about the path ahead and I'm grateful to be part of this team and this organization as we look to the future.
Steve Dennis 13:56
Well, maybe we'll get into a little bit how that diverse background has informed what you're doing now at, at Ulta. But on the off chance, there are some listeners, and we do have a, a pretty good global audience, so, I imagine there are some but, but can you just give us kind of a high level view of what Ulta is about? How the brand has evolved over the last few years? And then we'll talk more about your growth strategies going forward.
Dave Kimbell 14:21
Great, well Ulta is about a little over 30 years old. It started here in Chicago, where I am right now. Two, two entrepreneurs that had spent most of their career in retail and had an idea to create something new in beauty. And, and their insights that they developed in their original business plan, and I've had a chance to meet one of them and spend time with understanding what they're thinking, that their insights really continue to drive our business today.
And so, their vision was to disrupt beauty and disrupted in a way that meets consumers needs in a differentiated way. One of the core things they identified was most beauty retail at the time, and still largely today outside of Ulta is, is separated due to industry standards, not due to consumer engagement, and that's by mass and prestige. And we're the only retailer in the US and among only a handful across the globe, that bring together a complete assortment of beauty from across all price points, mass entry level, all the way up to high end luxury, and everything in between. And across all categories, makeup and skincare, and haircare, and fragrance, and bath, and increasingly into wellness, and accessories, just everything beauty. We call it all things beauty, all in one place. And that's been a big part of who we are and what we've been delivering to our guests and, and, and our guests respond to it. They saw that in the research they did 30 years ago, and it continues to be relevant for consumers today and every bit of research and I think it's been a big driver of our success.
On, on top of that, our founders and, and us today that are leading the company have had a long-term commitment to what we call human connections. Creating experiences, in, in you know first and foremost in our physical environment, but increasingly in every touch point that we have, with our guests that, that recognize the importance that beauty plays in our consumers lives.
Beauty is so emotional, it's so important to how people express themselves to the world. It's such a, you know, fundamentally about you know individual choices and how people feel about themselves. And so, with that emotion comes a great opportunity, and a responsibility to deliver an experience that recognizes the human elements of that. And we, we have worked hard for a long time to create a culture and an environment that allows our guests to come in and what we describe as discover the possibilities that lie within each of them through the power of beauty.
We feel we're not in the business, to make beau-, people beautiful they already are, we're just here to, you know, give them the, the environment that allows them to express themselves however they, they want. And that's been a big driver and really differentiates us.
And, and, and so we're, we're really proud of the success we've had, you know, we've grown into over these last 30 years into the largest retailer in the US, a beauty retailer in the US. We have 1300 stores, 40,000 Associates, you know we've shared publicly that we'll finish this fiscal year, which wraps up in just a couple of, of weeks, you know, o-, o- over a 8 billion dollars in, in sales and, and we see a lot opportunity ahead. So, excited and optimistic about the future and really proud of what we've delivered for these last 30 years.
Steve Dennis 18:02
Well, it’s really, it's a phenomenal story and really an incredible track record of success.
So, I'm interested in, you know, so that it sounds like there's this original insight that really drove the business model, the business format. Can you talk a little bit about you know, you're obviously in a very competitive category, there is lots of places where people can buy beauty related products in physical stores, online. Can you, can you talk a little bit about how over the last, you know, whether it's 10, 15, 20 years, how the shopping experience, how the consumer has really changed in this, in this digital world, constantly connected world, and how that's informed the way Ulta has evolved over the last few years?
Dave Kimbell 18:46
Well, you know, what's interesting, and you alluded to it, like we, we have some consistent insights and elements of our strategy that had been part of our business from again, the original business plan. And we just updated our strategy publicly, we had an analyst day, in October, where we shared an updated view of the path ahead of us. And what was I felt so cool and, and frankly, really inspiring within the company is the combination of the, the foundation on which our business has been built, the differentiated elements remain every bit as relevant as they were when they you know, we started the company. And that's, and we've when we're going to continue to drive and lead and differentiate in those.
But at the same time, we've worked hard to adapt our business to meet the needs and evolving expectations of, of, of beauty enthusiast across the country. And that combination, the ability to kind of stay true to who we are and what differentiates us, but also innovate and disrupt. You know, we were really creative with the idea of disrupting the category and it's not a one-time thing. We didn't just do it 30 years ago, we've been doing it continually for the entire time we've been around and, and so.
And then if we look over the last, you know decade, I, I really look at the history of our company in, in four, four chapters, the 90s, when we started the first 10 years was really about getting established, we were still pretty small, we didn't have that many stores, getting the model figured out. It was really in the 2000s, that decade that we started expanding, opening up more stores, establishing an eCommerce business, breaking into prestige in a bigger way.
And then, and then the 2000 and 10s is frankly, when we kind of took off. The, the foundation was there, but through a lot of innovation, innovation and how we told our brand story and marketed and communicated and made sure you know, beauty enthusiasts were aware of what made us special. We drove that innovation in our assortment. We've added hundreds of new brands and, and expanded rapidly into different areas of you know, of beauty to make sure that we're leading across every category.
And an innovation in, in how we engage our eCommerce business has, has grown, grown dramatically and is now a, a very substantial part of our business. But importantly, we built it in a way that it complements the store we didn't have never looked at eCommerce and physical stores as two separate businesses. We've always thought of them as one integrated consumer business because what, what we see is most guests don't shop well, just eCommerce, our, our stores guests shop eCommerce, and then they stop in, in store and we get a greater share of wallet. So, we've innovated across every touch point in digital and consumer engagement to make sure that we're evolving to meet, meet consumers needs.
And, and then you know, the last thing I'd say as, you know that's been key to our success is our culture. And we have worked hard over the last, you know, 6, 7, 8 years to ensure that the environment at Ulta is empowering, inclusive, engaging, exciting, which is the right thing to do. But it's also enables us to deliver these human experiences. 40,000 Associates every day delivering, you know, experiences in, as I said, a very emotional category. And so, that's been a big part of our, of our innovation and, and focus too. And until all those things come together to ensure that we're staying true to who we are and what, what you know has been our core foundation, but continually innovating across every dimension and aspect of our business to ensure we're disrupting and meeting the needs of beauty enthusiast every day.
Michael LeBlanc 22:50
It's, it's such a great story, let's, let's talk about the role of your stores, your 1300 stores. You are seeing a revival, if not a renaissance of sorts of brick and mortar as a strategy, not just a distribution point. So, at a strategic level, how do you, and you've mentioned it with your the integration of online in your stores, how does your t-, how does your team approach finding that right blend of channels so you know, what the customer is looking for, and of course, what your investors and, and what you're looking for from a performance from the business? How does that all come together? And how do you think about that?
Dave Kimbell 23:20
Well, we do, we do start like, like we try to do with everything, start with, with our, with our guests and understand how they want to engage. And what we've learned early on in our expansion of eCommerce is they, that like I said earl -, earlier, they don't look at these channels separately. What they look at is Ulta Beauty and kee-, and our ability to engage with them, excite them, bring them joy, bring them you know, new insights and education into beauty. As we do that they engage in more, in more elements that we offer.
So, what, what we have historically seen as of course, you know were a store business first and 1300 stores. So, we still have a lot of guests that have you only shop us in stores but when guests start to shop us online, if we can convert them into an online guest, what we actually see is their store frequency goes up. Even as they start shopping us you know, online. And what that tells us is you know it's not an either or, these aren't two separate businesses, it's another avenue to drive customer loyalty and engagement. And so, what we're getting when we get our guests engaged in more aspects of Ulta Beauty, we get greater share of wallet.
I, every one of our stores also has a, a full-service salon and, and so hair salon, brow services, makeup, skin services. That's another part of our Omni Channel strategy and another example that if we can get a guest who is shopping us for product, engaging us in, in Salon services we get more engagement across every touch point that we have. And, and it also serves another role for our physical stores, you can't cut your hair online. So-,
Michael LeBlanc 25:10
Right.
Dave Kimbell 25:11
We, we bring experiential elements into, into our physical stores every day.
And, and so our overarching, you know, emphasis both from a consumer standpoint, and then frankly, it's how I think about it with investors is, it isn't about the individual dynamics of any each of our channels. Of course, we're managing our costs, and there's cost pressures, on stores and there's cost pressures, and on eComm, we look at it through guest lens. And if we're able to excite our guests, we get rewarded through higher loyalty, higher share of wallet, more engagement and touch points. And that's proven to work for us. And it's how we're going to continue to think about it going forward,
Michael LeBlanc 25:50
What role do your stores and as you're thinking, changed about their role as acquisition? I mean, for a decade, a lot of marketing teams have focused on online and, and traditional methods. But you know, more and more of us are turning our minds to the stores as an acquisition tactic or even strategy. Are you guys thinking about that, as well as, as, as well as that en-, en-, engaging affect it has with the customers who are shopping in multiple channels?
Dave Kimbell 26:17
It has, stores have long played a guest acquisition. We see it, we're, we're, we've opened hundreds of new stores over the last few years. This year, in 2022, we're going to open 50 more new, new stores. And, and we see very much when we open up a store, we acquire new guests.
But we also see, what's really cool, we see eComm penetration increase in those trade areas when we open, open new stores. So, it is absolutely a guest acquisition, you know, opportunity for us. And, and even with 1300 stores, we've talked publicly, that we feel we could get up to 1700 stores, you know, standalone Ulta stores.
We also have expanded your physical presence in other ways, including our partnership with Target. So, we now have 100 locations of Ulta Beauty inside Target. And that relationship will expand in, in physical retail. And we see that as a guest acquisition by again giving them a physical way to interact with Ulta in a, in a new and different environment.
And so, physical retail, very much complements our digital efforts in attracting new guests. And in fact, when we're able to get them engaged in both, that's when we really hit the sweet spot and have, you know really highly valuable guests that are fully loyal and engaged with Ulta Beauty.
Michael LeBlanc 27:50
We talk about acquisition, I can't have you on the mic without briefly asking you about your plans for international expansion, I'm here in Toronto. Any, what are your thoughts on the international expansion and then and coming up here to the great white north?
Dave Kimbell 28:02
Well, we had announced plans, and we were actually moving forward, the, actively moving forward to launch into Canada. And, you know, before COVID, we, we were actually on track to launch in mid to late 2020. As COVID hit, we paused that just for a number of reasons. But mainly because we felt like we needed to focus on our core US business, and ensure that we, you know, understood what was ahead of us from a COVID standpoint and the disruption. And so, we, we, we've put all of that on hold.
And then you know, we've, we've actually shifted you know, some of that effort into establishing our relationship here in the US with Target and expanding and, and in that relationship. And as I said, we now have 100 stores there.
So, Canada in, in many ways, unfortunately was one of those strategic decisions we made because of the COVID disruption. I guess if that had never happened, we probably would be celebrating our stores opening and hopefully experiencing success in a great market with a lot of beauty enthusiast, with a lot of opportunity. But for now, it's not, you know, not in our immediate strategic plan. But we, we see international growth as an opportunity because our models unique and there's many markets around the world, including potentially Canada that we think we'd be relevant and, and deliver a great experience.
Steve Dennis 29:30
So, Dave I want to as we're, we're coming up on our time, I have two questions. One is, if you have a working crystal ball, which I don't, but if you had to say what some of the big stories for 2022 are going to be that the people who are working in retail or paying attention to retail should be focused on what, what are the things that would be top of mind? And then I'll ask you one broader question, that is probably unfair as well, but I'll, I'll do it anyway.
Dave Kimbell 29:58
Yeah, I wish I had a crystal ball, and, you know, I, I by no means you know, claimed to be an expert you know, as we think about what's ahead. And I think, you know, if, if one thing that the last two years have taught us, it's it, you know, we need to be adaptable and ready to adjust. And, you know, we're experiencing that right now with Omicron and everything else that's going on.
But as I look forward, I mean, certainly COVID is going to be a big part of our story throughout 2022. And, and so many of the capabilities that we've built to adapt and adjust and, and, and ensure that we're taking care of our team. You know, hiring is challenging, and particularly in this environment. So, our focus on our team health and wellness, as we've had so much challenge and pressure on them, will continue to be front and center as we see what's ahead of us as it relates to all things COVID.
But beyond that, you know, I think the environments going to be very strong. I mean, we're seeing that, as we closed out 2021. I think broadly speaking, retail had a positive, robust holiday, you know, we certainly felt positive about what we experienced. And then looking into this year, we're optimistic about the total consumer environment.
But for us, you know when we look at that, with that optimism comes a recognition that expectations from guests are as high as they've ever been. You know, we need to make sure that we're elevating every touch point, every experience because our, our guests, and I'd argue guest consumers across every, every consumer business, retail and (inaudible) products are reexamining what's important to them. And if we're not delivering every day, every single guest interaction.
I, I spent a lot of time in our stores, and I'm so proud of what they're delivering. And you know, one of the things that we just talk a lot about is, this is a time of real reevaluation for every human because of the disruption we've been through. So, it's even more important that we're taking care of every guest, we're bringing joy, we're bringing human connections, we are bringing light in you know, moments of darkness, we're finding ways to engage. And we eliminate the things that frankly, kind of our drag about shopping both in store and online because there's less tolerance for that.
And so that's going to be our big fo-. We have a number of secur-, strategies, but I've raised it, you know, it's ride through COVID, take care of our team adopt, adapt and adjust and make sure we are delivering for our guests in really human, joyful, positive ways every day. And I'm pretty confident about the path ahead. But we know there's going to be some twists and turns for sure.
Steve Dennis 32:44
Well, that's such an uplifting message that perhaps we'll just leave it there. Because I probably would drag us back down into some, some minutiae. But I really love talking. I mean, I, I one of the things I talk a little bit about it in my book, one of the eight essentials is this idea of being human centered, you know, bringing more empathy, more joy, more kind of a soulful connection to, to retail. And I really love that, that that's such a cornerstone of what you're doing. So, we'll leave it there.
Dave, thanks, thanks so much for joining us, we really appreciate all your perspectives. We'll put a couple links, that's actually one of the reasons why we reached out to you even though you were on our list for a while was I really loved what you said in your Investors Day Presentation. So, perhaps we'll do a link to that so people can get some more of the details, more of the exciting growth strategies that are being implemented in our, in the future. But thanks so much for joining us, Dave. Really appreciate it and Happy New Year.
Dave Kimbell 33:37
Thank you. Happy New Year to both you and thanks for your interest in Ulta Beauty and let's hope for a really great 2022 for all of us.
Michael LeBlanc 33:48
If you like what you heard, please follow us on Apple, Spotify, your favorite podcast platform so you can catch up with all our great interviews and insights and new episodes will show up each and every week. sure to check out our YouTube channel. And last but not least, tell your friends and colleagues in the retail industry, all about us.
Steve Dennis 34:03
And I'm Steve Dennis, author of the best-selling book, ‘Remarkable Retail: How to Win & Keep Customers in the Age of Disruption’. You can learn more about me, my consulting and keynote speaking at stevenpdennis.com.
Michael LeBlanc 34:17
And I am Michael LeBlanc, producer and co host of the Conversations with CommerceNext podcast, The Voice of Retail podcast, keynote speaker and host of the all-new Last Request Barbecue cooking show on YouTube and you can learn even more about me on LinkedIn for meleblanc.co. Have a safe week everyone.
SUMMARY KEYWORDS
stores, retail, guests, Ulta, beauty, business, year, people, bit, consumer, omicron, eCommerce, numbers, physical, big, talk, retailer, delivering, strategy, engage