This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Sephora Is Beating Pinterest at Its Own Game

NEW YORK (TheStreet) -- Sephora, the beauty line owned by luxury goods powerhouse LVMH Moet Hennessy (LVMUY) is playing its own game of social media in the style of Pinterest and Tumblr to bolster sales of its popular fragrances and skin cares.

Launching in March, Sephora's Beauty Board will allow users to tag beauty products in photos. These tags will link directly to Sephora's e-commerce website. The new platform will also combine existing Sephora online communities Beauty Talk, The Glossy, and Sephora TV together.

LVMH, which trades in New York as an American Depositary Receipt, was falling o.3% to $37.20 in mid-day trading Friday.

Sephora has been one of the most successful beauty product companies of the last five years in part because of its attractive platform online. Paris-based Louis Vuitton
is so convinced that it can power through with the added online sales that customers can now showroom its products at retail. The new Beauty Insider loyalty program has also helped boost sales both in physical stores and online.

Sephora's site won't attract the millions of users Pinterest did in such a short time. However, it appears Sephora has figured out the way to make money from "pinning" and sharing ideas online, at least for make-up. If consumers like a particular photo shared by others, they are now going to have a direct opportunity to buy the products necessary to get the look. Chalk this one up as a winner for Sephora in its continued online sales dominance.

Another potential growth opportunity for Sephora, which should see strong social media cross-promotional support, is the company's new "Divergent" themed makeup collection."Divergent", set to be released in March, is the first of three potential movies based on the bestselling book trilogy. The potential for more movies sets Sephora up well for future "Divergent" movies from Lions Gate Entertainment (LGF - Get Report). The move is also similar to one that CoverGirl did with "The Hunger Games", another Lions Gate property. This is Sephora's first movie collaboration and could be a potential source of growth for sales and foot traffic inside stores.

Sephora is one of the key pieces to conglomerate LVMH. Acquired in 1997, Sephora is now the second-leading retailer for beauty care products, trailing only Macy's (M - Get Report). Sephora continues to grow its physical presence with key store openings and a partnership with J.C. Penney (JCP). In January, Sephora opened a new flagship store in Shanghai that gave the company 143 stores in Asia. The company's strongest regions are Europe (900 stores) and North America (300 stores), but Asia and the Middle East (24 stores) continue to be key areas for growth.

Since October 2006, Sephora has seen its products on center display inside over 375 JC Penney stores through a partnership. The store within a store concept features one on one beauty consultations from Sephora employees and prominent display in the middle of the store.

In the last fiscal year, Sephora was part of a selective retail business segment that continued to grow for LVMH. Organic revenue increased 17% for the segment during the year. Specialty retail was the second biggest division for LVMH, making up 31% of sales and trailing only fashion and leather.

LVMH shares trade over the counter in the United States and may be worth a look with several strong brands. Sephora is ready to take on the internet world and sales will see a boost in the meantime.

At the time of publication the author had no position in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
LVMUY $36.60 0.00%
LGF $32.59 0.00%
M $63.72 0.00%
AAPL $128.46 0.00%
FB $78.97 0.00%

Markets

DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs