The iconic “Mona Lisa,” painted by Leonardo Da Vinci, transformed the art world during the Renaissance and continues to captivate audiences with her enigmatic smile. This masterpiece has endured for over 500 years, primarily due to one key factor: innovation. The enduring popularity of the “Mona Lisa” can be attributed to Da Vinci’s groundbreaking techniques and visionary ideas that challenged traditional norms.

Throughout his life, Da Vinci exemplified the spirit of innovation. He possessed an insatiable curiosity, which drove him to explore a wide array of subjects. His fascination with human anatomy led to meticulous studies of the facial muscles, including those that facilitate a smile. The insights he gained from these dissections were instrumental in the creation of his most celebrated work. Da Vinci’s relentless pursuit of knowledge allowed him to document the intricate interplay of muscles necessary for producing a genuine smile, contributing significantly to the legacy of his art.

Moreover, Da Vinci made significant strides in various fields, from discovering why the sky appears blue to understanding the mechanics of a woodpecker’s tongue. He investigated principles of water flow, unearthed fossils of marine life in mountainous regions, and even conceptualized flying machines, including early designs of helicopters. The breadth of his innovations is astonishing. His detailed journals reveal a life dedicated to data collection and analysis, showcasing his multifaceted genius as an innovator and an early advocate for an omnichannel approach to learning.

This week’s guest on the CX Decoded podcast, Michelle Pacynski, understands the importance of innovation and data collection within the beauty industry. As the Vice President of Digital Innovation at Ulta Beauty, Michelle has spearheaded the company’s digital transformation over the past decade. Under her leadership, Ulta has redefined the way beauty products are marketed and presented to enthusiasts, ensuring a seamless integration of digital experiences.

In our conversation, we aim to uncover valuable lessons that other brands can glean from the beauty industry, particularly regarding the exceptional engagement levels of beauty enthusiasts.

Editor’s note: This transcript has been edited for clarity.

Dom Nicastro: Hello, everyone! Welcome back to another exciting edition of CX Decoded, season three, here at CMSWire. I’m Dom Nicastro, the Managing Editor of CMSWire.com, and today, I’m joined by my co-host, Jennifer Torres, who’s making her debut in the CX Decoded podcast universe. How’s it going, Jenn?

Jennifer Torres: Hi, Dom! Thrilled to be here—it’s an exciting opportunity!

Dom: Great to have you on board! Let’s dive right in. I really appreciate episodes of the CX Decoded podcast that feature professionals actively engaged in enhancing digital customer experience. Today, we are privileged to have Michelle Pacynski, the VP of Digital Innovation at Ulta Beauty, joining us to discuss her insights into digital customer experience initiatives. Welcome, Michelle! How are you doing today?

Michelle Pacynski: Hi, Dom! Hi, Jennifer! I’m doing well, thank you. It’s wonderful to be here.

Dom: Fantastic!

Jennifer: Michelle, let’s kick things off by getting to know you better. Can you share your role at Ulta Beauty, how you arrived there, and a fun fact about yourself that’s not work-related?

Michelle: Absolutely! Thanks for having me! So, a little about Ulta Beauty—we are the largest beauty retailer in the United States, offering a wide range of products including mass and prestige cosmetics, fragrances, skincare, and haircare, alongside salon services. We boast over 25,000 products available in more than 12,050 locations, along with robust digital platforms.

Regarding my background, I’ve been with Ulta Beauty for just over 10 years. Initially, I started in IT, overseeing all guest-facing systems, which included our stores, marketing, e-commerce, and mobile initiatives. Four years ago, we established a dedicated digital innovation team as part of Ulta’s commitment to drive further innovation and enhance guest experiences. This team operates within the digital commerce division and is dedicated to merging digital and physical beauty journeys through thoughtful technology development.

As for a fun fact, I hail from Minnesota! I was born and raised there, and my entire family still lives there. I make frequent visits throughout the year.

Dom: So, during the Bears-Vikings game, what’s your allegiance?

Michelle: Oh, I have to confess—I root for the Bears over the Vikings! I know that might not sit well with my fellow Minnesotans!

Dom: That’s a bold choice! Conference rivals, right?

Michelle: Absolutely! But I should probably start supporting the Vikings this season; they seem to be doing quite well!

Understanding the Digital Channels That Fuel Ulta Beauty’s Growth

Dom: They certainly outperformed my Patriots! Now, aside from football, let’s talk about those digital channels you mentioned. Our audience is always eager to know which digital channels to prioritize for investment and why. Can you elaborate on Ulta Beauty’s digital landscape and the channels that have driven your success?

Michelle: Of course! At Ulta Beauty, our key digital channels include Ulta.com and our mobile apps, available for both iOS and Android platforms. We’ve offered mobile apps since 2012, and they’ve evolved significantly since then. There’s often debate about the necessity of native apps, but I firmly believe that our mobile app has proven to be invaluable. It has over 5 million downloads, showcasing our strong user adoption.

One of the main advantages of our mobile app is its efficiency and ease of use. Users can remain signed in, making all of their information readily available, which leads to a seamless checkout experience. Our digital channels have experienced tremendous growth in recent years, especially during the pandemic. While COVID-19 has had lasting effects, the demand for digital solutions skyrocketed as consumers sought convenience and accessibility. The synergy between our online platforms and physical stores is remarkable, as they complement each other perfectly.

Dom: The integration of digital and physical experiences is crucial, especially in today’s retail landscape. During the pandemic, digital channels became the primary touchpoint for many consumers. Some industry professionals refer to this approach as “phygital.” Have you encountered this term, Michelle?

Michelle: I haven’t come across that specific term, but we’ve certainly been discussing omnichannel strategies for quite some time. At Ulta Beauty, omnichannel is essential, and guests who engage across multiple channels are our most valuable customers.

Related Article: How Omnichannel Marketing Enhances Customer Experience

Driving Beauty Retail Forward with Digital Innovation

Jennifer: Michelle, Ulta has emphasized that digital transformation is a core focus. Can you share some details about the partnerships and experiments you’ve conducted that have propelled this focus?

Michelle: I’d be happy to! Shortly after establishing our digital innovation team, we made our first acquisitions in the digital space. One of those acquisitions was our long-time partner, Glam Street, known for their virtual try-on technology, which we initially launched in our mobile apps back in 2016. Additionally, we partnered with a small AI startup, QM Scientific, based in Silicon Valley. Both acquisitions enabled us to develop a robust personalization platform.

The goal was to create unique, one-to-one online and offline experiences that guide our guests through their beauty journey, enhancing their overall experience and engagement.

Dom: So, were you building this technology internally, Michelle?

Michelle: Initially, we collaborated with Glam Street as a third-party provider, while also leveraging our internal data to deliver differentiated experiences. Over the years, we have developed specific tools in-house, but the acquisitions significantly accelerated our efforts in personalization and data mining. For example, our Glam Lab solution allows users to virtually try on makeup, creating a deeply personal experience based on individual visual characteristics, which enhances the relevance of our product recommendations.

Dom: Managing digital assets is likely a significant challenge in your context. Is digital asset management (DAM) a key focus for you, and how do you ensure quality in managing these assets?

Michelle: Absolutely! Digital asset management is a critical aspect of our operations. Our content team, specifically the digital merchandising team, oversees this. Calibration of products for virtual try-on is vital, requiring us to understand various factors such as coverage, texture, and color accuracy. Each product must be uniquely labeled and managed to provide a high-quality virtual try-on experience, ensuring guests receive accurate representations of the products they wish to try.

Jennifer: You mentioned omnichannel earlier, Michelle. Can you elaborate on how Ulta executes this strategy and its significance?

Michelle: Certainly! At Ulta Beauty, we define omnichannel as engaging guests across all available touchpoints, including physical stores, digital platforms, and social media channels like Instagram, Facebook, YouTube, and TikTok. Our goal is to create a seamless experience for guests who transition between these channels. Our robust digital presence provides guests with comprehensive product information, reviews, and trends, while our stores offer an inviting environment for hands-on exploration of products.

We strive to ensure that whether a guest is browsing online or in-store, they receive consistent, engaging experiences that cater to their preferences.

Empowering Your Business with Data Democratization

Dom: This is incredibly insightful! To succeed, a strong grasp of data is essential. Michelle, as you navigate omnichannel strategies—comprising physical stores, social media, email, website, and mobile app—how does Ulta Beauty approach data management? What systems do you have in place to ensure actionable insights?

Michelle: Great question, Dom! We believe our data is among the most distinctive in the retail sector. With over 38 million active loyalty members, we encompass a diverse range of beauty products across various price points. Remarkably, around 95% of our sales stem from these loyalty members, allowing us to gain profound insights into our guests’ preferences.

We continuously mine this extensive dataset, utilizing artificial intelligence to enhance our personalization efforts. A few years ago, we embarked on a mission to democratize our data, breaking it free from silos and moving it to the cloud for easier access. This transition enables us to leverage AI technologies to cluster data and deliver highly relevant recommendations tailored to our guests’ needs.

Related Article: Do Your Customers Trust You on AI, Data Collection, and Customer Experience?

Elevating the Beauty Experience with AI and AR

Jennifer: Since Ulta was founded, the company has transformed the beauty shopping experience by making products accessible for trial and testing. How do you see AI and AR further enhancing this experience?

Michelle: Ulta Beauty has revolutionized the beauty retail landscape by consolidating various categories—cosmetics, haircare, skincare—across all price points into a single, accessible location. Traditionally, beauty products were confined to behind counters in department stores, making them less accessible to consumers.

With our innovative approach, we’ve made beauty products approachable for everyone. However, the pandemic presented challenges, as testers and samples were temporarily unavailable. This is where AI and AR technologies came into play, allowing guests to engage with beauty products virtually, regardless of their location. Virtual try-on capabilities empower customers to experiment with products from the comfort of their homes, ensuring they can still engage with our offerings.

As stores reopened, beauty enthusiasts returned with enthusiasm. Advanced AI technologies now enable us to process facial images and apply virtual makeup effects, allowing guests to explore beauty both online and in-store.

Related Article: How Augmented Reality Will Shape Future Marketing Strategies

Prioritizing Safety and Flexibility in Customer Experience

Dom: Michelle, reflecting on March 2020—a month we all remember vividly—what has changed in Ulta’s digital strategy since then? What do you consider the most significant shift in your digital approach over the past two-and-a-half years?

Michelle: The pandemic underscored the importance of digital engagement. Our experiences during COVID-19 accelerated our digital initiatives. As we’ve emphasized previously, meeting customers where they are is crucial. The introduction of options like buy online, pick up in-store, and curbside pickup have become essential components of our service offerings. Providing various formats for browsing, discovering, and purchasing has become a requisite in today’s landscape.

Moreover, flexibility has taken on heightened significance. Customers expect rapid delivery options—next-day or same-day service—and the ability to choose between home delivery or in-store pickup. These choices are crucial for enhancing customer satisfaction. Safety measures have also become paramount, with protocols in place to ensure a secure environment for our guests in-store. We prioritize their comfort, giving them the choice to wear masks or not, depending on their preferences.

Empathy is also vital; understanding the challenges our customers face and providing support for them, as well as our team members across all departments, is essential.

Related Article: How the Pandemic Has Changed Voice of the Customer Approaches

Exploring the Metaverse: Opportunities for Ulta Beauty

Jennifer: Looking ahead, I’m intrigued by the possibilities of the metaverse. What initiatives has Ulta explored in this space, and how do you envision our role in a virtual world?

Michelle: The metaverse is an exciting frontier for us. We view it as another realm where beauty enthusiasts can engage. Recently, we launched an NFT commemorating Ulta Beauty’s founding anniversary, which included an augmented reality experience. Additionally, we’ve ventured into platforms like Roblox, where we can interact with a diverse audience and gather insights about their preferences.

Our explorations in the metaverse are still in the early stages, and we recognize that many beauty enthusiasts may not yet have digital wallets, presenting a challenge for broader adoption. However, platforms like Roblox provide an opportunity to engage with millions of users globally, which is valuable for brand awareness and education.

Dom: It sounds like engaging with younger demographics in the metaverse could yield exciting outcomes for your brand. However, it may take time before we see widespread adoption. Are you finding that your loyal customers are diving into the metaverse yet, or is it still too early?

Michelle: We haven’t yet established a clear connection between our virtual initiatives and our existing customers. However, we recognize the potential for building brand awareness among younger audiences. Engaging with them in these virtual environments can help us educate them about our brand and offerings, fostering a sense of connection. We believe there’s a great opportunity to learn from their engagement habits and preferences.

Related Article: Is It Time for Customer Experience Professionals to Explore the Metaverse?

Leveraging Low-Code and No-Code Solutions for Innovation

Dom: As we wrap up, I’d like to touch on the low-code and no-code phenomenon in the CX marketing tech space. How does Ulta leverage these tools to enhance your digital initiatives?

Michelle: That’s an excellent question! Having been a technologist for years, I can attest to the effectiveness of low-code and no-code tools. These solutions have matured considerably and are now integral to our digital innovation processes. My team utilizes these tools extensively for rapid experimentation and development.

One of the key advantages is their ability to access various data sources quickly and efficiently. These tools often come with libraries of pre-built functionalities, similar to building blocks, allowing us to easily assemble and manipulate data. For instance, we can analyze product reviews to identify commonly used terms and feedback. We are strong advocates of low-code and no-code solutions as they enable us to create and iterate on experiences swiftly.

Related Article: No-Code/Low-Code Solutions: A Pathway to Enhanced Customer Experience

Insights on Customer Engagement from the Beauty Industry

Jennifer: To conclude, Michelle, what insights can CX practitioners from various industries take away from the beauty sector’s approach to customer engagement?

Michelle: The beauty industry exemplifies high levels of customer engagement. Beauty enthusiasts actively participate in discussions about products on social media, sharing their experiences and recommendations. The rise of influencers creating how-to content has further fueled engagement, enabling customers to connect with brands authentically.

For CX practitioners, the key takeaway is the importance of fostering engagement. Understanding how to cultivate meaningful interactions within the beauty community can serve as a valuable blueprint for enhancing customer engagement across various sectors.

Dom: Thank you, Michelle, for sharing your valuable insights into the digital landscape of Ulta Beauty!

Jennifer: Yes, Michelle, it’s been a pleasure having you on the podcast. Thank you for joining us!

Michelle: Thank you both for having me!

We invite you to reach out with any comments or suggestions for future podcasts. If you enjoyed this episode, please consider leaving a review on Apple Podcasts or your preferred listening platform. Don’t forget to share CX Decoded with anyone who might find these conversations beneficial. Lastly, follow us on Twitter at CMSWire. Thank you for joining us, and we look forward to seeing you next time.