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J.C. Penny, Sephora shoppers share similar spending habits.


Midwestern mothers, meet Madison Avenue.

Five new J.C. Penney Co. Inc. stores feature a mini Sephora, which offers a variety of high-end makeup, lotions and fragrances. Sephora USA LLC is owned by LVMH Moet Hennessy Louis Vuitton SA. The Glendale Galleria is one of the locations.

Penney's laid out an accelerated growth program last week as it opened 20 new stores. This is the biggest round of openings for the $19 billion chain based in Plano, Texas, since the 1970s. Long in need of a facelift, it's no surprise that Penney's would turn to one of the hippest and fastest-growing beauty chains as part of its much-needed brand overhaul.

Sephora has built its brand with free-standing stores in upscale, metropolitan city malls, offering savvy and educated salespeople and encouraging customers to test and smell a wide variety of hard-to-find lines, including its own eponymous brand.

Sephora's devotees might be surprised to find their beloved BeneFit, Stila and Philosophy brands at a retail outlet perhaps known for quality, but utilitarian, T-shirts and underwear. Sephora, however, sees the move as a way to broaden its audience.

"Sephora's partnership with JCPenney allows us to dramatically raise awareness of our brand, even as we continue to aggressively build our own store base," said Satish Malhotra, vice president and general manager of the Sephora Inside JCPenney Initiative. "There is not a lot of overlap between Sephora stores and JCPenney stores, so we believe the majority of their clients will be new ones for us, and we're confident they will be happy to see us."

Though their customers are very different--the average age of a Penney's customer is 48, while Sephora buyers are 25 and younger--they have similar spending patterns. Penney's customers spend about $650 each year on beauty products--the same as Sephora's base.

The Glendale location store within the department store is 2,500 square feet, about half the size of an average Sephora stand-alone.

Penny's stock got a slight bounce on the string of announce ments, and was trading around $70 last week.

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Title Annotation:MARKETPLACE; J.C. Penney Co. Inc. partners with Sephora USA L.L.C. to grow business
Author:York, Emily Bryson
Publication:Los Angeles Business Journal
Date:Oct 9, 2006
Words:340
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