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A retailer has a unique place in the shopping journey.
It works with brands that sell products on its shelves, and service providers that improve its operational and customer-facing functions. Putting these relationships to work alongside the infrastructure of the stores and platforms it operates ultimately shapes an overall experience for shoppers.
In turn, this gives retailers a unique view into the trends and tools that are shaping how brands are developing products and outreach strategies to connect with shoppers, and what motivates customers to buy from them.
It also puts them in a position to look at what’s coming next.
As operators of ecommerce platforms and relationship builders with customers that are increasingly using digital tools to shop, often that future-minded gaze is cast in the direction of technology that’s being built, and the shifts in shopper behavior that will shape it.
Given their position, retailers are recognizing that they can help to push forward toward that future, too, and do so in a way that grows in the same direction their strategy is pointing.
With this, some retailers are starting to adopt the position of ecosystem leaders, nurturing a new generation of startups with funding and resources.
The latest sign arrived Wednesday, as Ulta Beauty launched a digital innovation venture fund to invest in startups that are developing technology to shape online and in-store shopping experiences.
The fund, called Prisma Ventures, will have $20 million available for investment in startups building technology that “fuels greater discovery, personalization, and convenience,” Ulta said.
Backing seed and Series A startups, Prisma is focusing in four areas that fit with Ulta Beauty’s strategic prerogatives:
- Personalized and data-driven technology
- AR, VR and the metaverse
- Technology-powered custom beauty products and in-store services
- Social commerce
The goal of making an investment, Ulta Beauty said, is to forge a long-term partnership between innovator and retailer. Startups will not only receive resources to build, but tap the retailer’s team and work with its tools as they do so. Alongside funding, Ulta is providing access to its innovation team, consumer insights and in-market testing opportunities.
“We believe this fund presents opportunities for creative disruptors to further propel the industry forward,” said Prama Bhatt, Ulta’s chief digital officer, in a statement. “We set out to build lasting relationships with startups, welcoming them into our ecosystem, co-creating and experimenting in ways that tap each other’s expertise and ultimately leverage our resources to imagine – and reimagine – what’s next for retail and beauty.”
Ulta provides access
Though a contract is not the sole focus, there may also be a chance for startups to develop products that will end up in Ulta's aisles and apps. The company said it has already invested in a group of startups that are assisting with personalization and diagnosis in its digital skin and hair experiences. Ulta said that it “does not intend for all investments to directly impact its offerings but where synergies exist, the partners will co-create to bring innovation to the market.”
The company shared the experience of Iterate.ai, a company developing artificial intelligence and internet of things technology that started working with Ulta through a small agreement in 2016 that grew to an investment.
“Ulta Beauty’s investment was a gamechanger, providing us both with an incredible opportunity to test, learn, deploy, and scale our low-code AI innovation platform. Ulta Beauty leveraged our platform to create engaging, differentiated experiences for beauty lovers nationwide, plus it added to Iterate’s credibility,” said Iterate.ai CEO Jon Nordmark.
This network effect and virtuous cycle is the reason retailers are in a position to lead ecosystems. Ulta Beauty joins The Home Depot and Chipotle among retailers that have stood up corporate venture funds this year. More are likely to follow. As we wrote in Retailers are the new tech companies:
In tech, small companies with big ideas and focus have huge advantages. Collaboration is a must in order to grow. Retailers must also be mindful of the startups bringing new products, and seek opportunities for partnerships that will yield mutual benefits. For particularly promising companies, there will be chances to support them, as well. There may be more room for retailers to play a bigger role in the startup ecosystem as venture investment among institutional firms cools off.
There are different types of initiatives that companies can organize to become a galvanizing force for startups.
A venture fund provides a way to invest in technology that it sees as important down the road, and play a role in its development.
But the type of business an initiative supports and programming model it uses can vary, depending on the company's goals.
With an accelerator, Ulta Beauty is acting as an ecosystem leader with up-and-coming beauty brands, as well.
In September, it will begin the first cohort of the MUSE Accelerator, a program for early-stage, BIPOC-founded beauty brands that provides $50,000 in funding, training in building a brand through a 10-week curriculum developed in partnership with Venture Noire, mentorship and an opportunity to pitch investors.
The accelerator model was honed with software startups in Silicon Valley, mixing generalized education for founders in the ways of lean startup methodology with personalized support that could help open doors. A short-term timeframe and colocation alongside other founders through a cohort model was designed to help aggregate potential opportunities for the community, encourage founders to move quickly and create collisions that could lead to partnerships and power innovation.
Ulta’s program shows how the basic shape of this model can be adopted to support inclusive entrepreneurship that gets resources to the underrepresented community of BIPOC founders, and adopted for consumer goods and the specific category of beauty.
The program's focus fits with a strategic imperative for the retailer, like the venture fund, and is grounded in community impact. Ulta Beauty Chief Merchandising Officer Monica Arnaudo said in June's launch announcement of the MUSE program that the retailer is “bringing to life our commitment to diversifying our unparalleled assortment so all guests can see themselves reflected at Ulta Beauty.”
At the same time, the brands will benefit from not only Ulta Beauty’s resources, but the expertise that it can provide. After all, who better than a retailer to provide insights on what it means to be retail ready.
If a program leads to a direct working relationship, all the better. But it need not be the point from the outset. Often, work with brands and partners at a retailer like Ulta has business imperatives and performance metrics attached to it. An ecosystem leader plays a different kind of role. The fact that Ulta is providing connections to the innovation team through the venture fund and mentorship through the accelerator enables teams to build together.
By doing so, there’s a chance the future they envision will arrive sooner than you might think.
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On the Move has leadership and promotion news from Pacsun, Calvin Klein and CVS Health.
This week, one of the world’s largest consumer goods companies hires a new CEO, while a luxury ecommerce platform taps a successor to its founder. Plus, we’ve got news on top leadership hires and promotions at Pacsun, West Elm and Calvin Klein Americas.
Unilever appoints CEO
Hein Schumacher. (Courtesy photo)
Hein Schumacher will be the next CEO of Unilever, effective July 1. Schumacher comes to the maker of Dove, Hellmann’s and Ben & Jerry’s from Royal FrieslandCampina, where he is credited with leading turnaround efforts at the $11 billion business.
Succeeding the retiring Alan Jope, Schumacher will assume the top job at Unilever as it appears to be on the precipice of change following the appointment of activist investor Nelson Peltz to the board in May.
“The Board looks forward to Hein realising the full potential of Unilever as a winning business which delivers long-term growth and value for all its stakeholders,” said Unilever Chairman Nils Andersen, in a statement.
Brie Olson named co-CEO in Pacsun shakeup
Brie Olson. (Courtesy photo)
Brie Olson was promoted to co-CEO of Pacsun from the role of president. Olson will serve alongside co-CEO Mike Relich. With the move, Alfred Chang will transition to the CEO role at clothing brand Fear of God, which is a Pacsun brand partner. As president, Olson oversaw Pacsun’s AI and metaverse initiative, led a variety of brand partnerships and introduced a gender neutral collection.
The RealReal hires Wainwright's successor
John E. Koryl is joining The RealReal as CEO. Koryl is stepping in to lead the luxury ecommerce platform after founder Julie Wainwright stepped down in June. He comes to the company from the digital arm of Canadian Tire Corporation, and also previously played a key digital transformation leadership role while serving as president of stores and online Neiman Marcus.
West Elm taps Ralph Lauren Home lead as president
Day Korbluth. (Courtesy photo)
Day Kornbluth was named president of West Elm. Kornbluth comes to the Williams Sonoma-owned sustainable home retailer from Ralph Lauren Home, where she served as president. The company credited her track record of growing home furnishing brands with a focus on product and digital innovation. The move follows former West Elm president Alex Bellos' appointment as CEO at Food52 earlier this year.
Vera Bradley shakes up leadership
The travel and accessories retailer Vera Bradley announced a leadership shakeup that resulted in the following:
President Daren Hull, Chief Creative Officer Beatrice Mac Cabe and Chief Revenue Officer Mary Beth Trypus all saw their roles eliminated, and will be leaving the company.
The company will also add the position of SVP of merchandising and design, and is actively conducting a search.
Alison Hiatt joined Vera Bradley as chief marketing officer to oversee digital marketing, customer data and ecommerce. Hiatt brings experience from the food company Salt and Straw.
Pura Vida, which is owned by Vera Bradley, will see co-presidents Griffin Thall and Paul Goodman leave the company. With this, Vera Bradley will acquire a 25% interest in Pura Vida from Thall and Goodman for $10 million, effective January 30.
Vera Bradley said it is making these changes to "drive cost savings, add more focus on marketing and merchandising, and position the Company to deliver steady top- and bottom-line growth."
Master P named chairman of Launch Cart
Percy "Master P" Miller. (Courtesy photo)
Percy “Master P” Miller was appointed chairman of the board at Launch Cart, an ecommerce platform that bills itself as an alternative to Shopify. Alongside a rap career that yielded 90s hits with his label No Limit Records, Miller brings a track record as an entrepreneur in food and entertainment. “With his entrepreneurial spirit and deep understanding of the power of business, our partnership will make it easier for aspiring entrepreneurs to realize their dreams of starting an online business, building a brand, and generating income,” said cofounder Bernt Ullmann.
Kohler to lead Calvin Klein Americas
Donald Kohler. (Courtesy photo)
Donald Kohler was named president of Calvin Klein Americas by parent company PVH Corp. Kohler brings experience from a 15-year career in retail from Burberry, Salvatore Ferragamo and Diesel. The company said his expertise includes direct-to-consumer, third-party driven business models and ecommerce. The new comes on the heels of the appointment of Inditex executive Eva Serrano as global brand president at Calvin Klein.
Skims appoints chief commercial officer
Robert Norton is joining Skims as chief commercial officer, and will lead international expansion. Norton joins the Kim Kardashian-founded shapewear brand from Moncler, where he served as president of the Americas. Over a two-decade career, he also previously served as CEO of the Americas for Roberto Cavalli and was an executive at Ralph Lauren.
“I have been a fan of Robert’s for several years and believe him to be a rare, creatively minded executive who knows how to build both a brand and a business,” said Jens Grede, cofounder and CEO of Skims, in a statement. “We are excited to have Robert on the team as we continue the evolution of SKIMS into a global retail brand.”
CVS Health creates chief product officer role
CVS Health announced a pair of appointments:
- David Joyner will join the company as EVP and president of pharmacy services, which serves employers, health plans and government. Joyner previously worked with CVS Health, and has 34 years of experience.
- Amy Bricker was named EVP and chief product officer for the consumer. She assumes the newly-created role to head consumer products and innovation after serving as president of Express Scripts.