1. Ulta Beauty’s Unconven0onal Growth Story:
Omnichannel Expansion is a Beau0ful Thing
Jeff Hamm
Sr Director, E-Commerce
Ulta Beauty
Presented: September 27, 2016 at Retail’s Digital Summit
Pat Ogawa
Managing Director
DeloiQe

2. CONFIDENTIAL & PROPRIETARY 2015 2

3. CONFIDENTIAL & PROPRIETARY 2015 3
Play Ulta Intro Video

4. CONFIDENTIAL & PROPRIETARY 2015 4
• Founded in 1990
• The largest beauty retailer in the
U.S.
• The premier beauty des<na<on
that provides All Things Beauty,
All in One Place

5. CONFIDENTIAL & PROPRIETARY 2015 5
More than 900 retail
stores with more than
28,000 employees
na<onwide

6. CONFIDENTIAL & PROPRIETARY 2015 6
Over 20,000 beauty products, from over 500 brands!

7. CONFIDENTIAL & PROPRIETARY 2015 7
And a Salon in every store…..

8. CONFIDENTIAL & PROPRIETARY 2015 8
More than 20
million ac<ve
members!!

9. 9
Ulta Beauty’s Strategic ImperaOves
Acquire new guests
and deepen loyalty
with existing guests
Differentiate by
delivering a
distinctive and
personalized guest
experience across
all channels
Offer relevant,
innovative, and
often exclusive
products that excite
our guests
Deliver exceptional
services in three
core areas: hair,
skin health, and
brows
Grow stores and
e-commerce to
reach and serve
more guests
Invest in
infrastructure to
support our guest
experience and
growth, and capture
scale efficiencies
1 2 3 4 5 6
TALENT THAT DRIVES A WINNING CULTURE: GUEST-CENTRIC, VALUES-BASED, HIGH PERFORMANCE
7

10. 10
A History of Strong Financial Performance
$1,223
$1,455
$1,776
$2,220
$2,671
$3,241
$3,924
2009 2010 2011 2012 2013 2014 2015
Total Sales ($ In Millions)
$17
$30
$41
$55
$96
$150
$221
2009 2010 2011 2012 2013 2014 2015
eCommerce Sales ($ In Millions)

11. CONFIDENTIAL & PROPRIETARY 2015 11
Omni- Channel at Ulta Beauty –
PuSng the Guest at the Center

12. 12
Connected Guest
Home
In-Store
Mobile

13. 13
What’s Connected….
Online
Salons
Stores
Online Booking
Guest

14. 14
What’s Connected….
DC Inventory
Digital Marke<ng
CRM Data
Print
Guest

15. 15
….Bringing it together, Mobile First!

16. 16
Leadership Model
SUBHEAD Omni Channel is not just about features and funcOonality

17. 17
Procurement
End to End CollaboraOon
• Organiza<onal focus to provide one
end to end experience
• Cross Func<onal teams assembled
for func<onal exper<se
• Strong internal collabora<on and
open and honest communica<on
• Goals set for each area – Individual
teams understand how they
support the overall goals
IT
Accounts
Payable
New Store
and
Remodels
E-Commerce
Pricing
Space & Floor
Planning
Inventory
Control
Merchandise
Opera<ons
Marke<ng
Supply Chain
Strategy &
Opera<ons
CRM
Merchandising
Legal
Visual
Real
Estate
Merchandise
Planning &
Inventory
Brand
Partners
Transporta<on
Store
Opera<ons

19. -3.0%
-0.5%
2.0%
2013 2014 2015
US GDP Top 10 US Retailers Annual Sales
Divergence
US GDP
Top 10
Retail Sales
Retail performance is diverging from the economy’s performance
Copyright © 2016 Deloitte Development LLC. All rights reserved.

20. And traffic to physical stores continues to plummet
Physical Store Traffic
-15%
-10%
-5%
0%
Apr '14 Jul '14 Oct '14 Jan '15 Apr '15*
Traffic Trend (Traffic)
Source: RetailNext, Retail Performance Pulse, Year-Over-Year reports (2015).
Note: March/April spike due to movement of Spring Break and Easter holidays
Copyright © 2016 Deloitte Development LLC. All rights reserved.

21. 0%
5%
10%
15%
20%
2007 2008 2009 2010 2011 2012 2013 2014 2015
Note: Based on the top 153 US retailers (1) Market Share Volatility is measured as the weighted standard deviation; retailers contributing most to annual volatility
Source: US Bureau of Labor Statistics, 2016
Market Share
Volatility1)
• Market share
being ‘traded’
• Since 2010, 250%
increase in
volatility
• $200 billion more
of retail sales
being “traded”
among
competitors
When an industry is being disrupted, market share volatility spikes
Copyright © 2016 Deloitte Development LLC. All rights reserved.

22. Consumer preferences continue to shift
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
0.0
17.6
16.0
16.8
18.4
Consumer Expenditure
Services
Goods
Source: US Bureau of Labor Statistics, 2016
Note: Goods include Food & Drinks, Tobacco, Clothing & Footwear, and Household Goods; Services include Communications, Leisure & Recreation, Hotels & Catering
Percentofspend
Copyright © 2016 Deloitte Development LLC. All rights reserved.

23. Some retailers have found ways to win in a highly volatile market
10.7%
Relative Performance
[2010-15] – Compound Annual Growth Rate [CAGR]
Experience Differentiation
ProductDifferentiation
Low High
LowHigh
Value & Convenience
Highly differentiated product
Highly differentiated experience
Highly differentiated offering +
experience
5.8%
3.5% 8.0%
Source: US Bureau of Labor Statistics, 2016
2.4% 14.5%
(3.2)% 9.5%
Revenue
EBITDA
Revenue
EBITDA
Revenue
EBITDA
Revenue
EBITDA
Copyright © 2016 Deloitte Development LLC. All rights reserved.

24. QuesOons for the Speaker?
Go to: www.pollev.com/ultaretail or text
ultaretail to 22333