If the brands on the Leap platform have one thing in common, it’s that they’re all growing. Fast.
Apparel is the fastest-growing category post-pandemic. Emarketer predicts an increase in ecommerce sales of 18.9%. We’re already seeing growth pick up in the market. Retail clothing and accessory sales are up 105% from March 2020, according to the U.S. Department of Commerce. Growth across retail categories is coming, but succeeding in the new market will require planning, preparation, and strategy.
Driving growth requires a 360° approach. Brands need direct ecommerce, physical retail, and other third party channels operating on all cylinders to win. The key to lasting success is creating consistent experience for your customer across all of these channels. However, to truly do this at a world class level—especially with physical retail—you need proper resources, focus, tools, and partners.
To that end, as part of our Omnichannel Retail content series on the Leap blog, we will be diving into the fundamentals to educate modern brands on what makes a retail program successful.
What is a Modern Brand?
Modern brands don’t have to be new brands. They don’t have to sell a new product, or even shake up their vertical with a unique business model.
Modern brands are those that prioritize growth through experience, innovation, and flexibility. What does that look like?
Brands that prioritize the customer and have a unique and differentiated brand and product. This can mean having a brand strong enough to create standalone experiences that customers can interact with, like the House of Vans. Or it can mean a consistent, cohesive combination of brand design elements, customer service, and connected technology, like the ease of shopping at a Warby Parker retail store.
Take cashmere pioneers NAADAM, for example. Every part of experience online and off promotes comfort, sustainability, and their commitment to source materials directly from their source. To promote their recent “Fancy AF” campaign highlighting their high-quality cashmere, they leveraged the Leap platform to sponsor free pedicab rides in the West Village. The activation shows their commitment to cohesive experience that gets customers excited about their brand.
Brands that push boundaries remain relevant. Whether they’re using new technology to find ways to connect with customers, or experimenting with new manufacturing methods, in-store technology, or business models, modern brands push to innovate. While there are plenty of innovative up-and-coming brands cutting out the middleman and going direct to the consumer, legacy brands are just as or more likely to have the resources required to push the envelope.
Rent the Runway is a great example of a modern growth brand. RTR’s model isn’t just an update of the old-fashioned gown and tuxedo rental shop. By combining an advanced tech stack and data analytics with next-level logistics and infrastructure, they’re changing the way women think about fashion, and their own wardrobe. RTR gives their members an alternative to traditional high-fashion retail. Renters have access to a massive, cloud-based closet that they can use to experiment with, accent, or define their entire sense of style. Besides a few basics, they may not need to buy another piece of clothing again.
The ability to update your approach and welcome an ever-changing market is a hallmark of modern brands. To succeed at all in a competitive marketplace is something to marvel at. Sustained success is even rarer, and even more impressive. To keep on winning, modern brands need to always be adjusting their approach, their product offerings, their target customer, and their experience. Their reward for this constant drumbeat of testing, trying, and learning is permanence in a fast-moving world.
Birdies launched to solve a common problem for many women. What do you wear inside that’s stylish enough for company, but more comfortable than your own shoes? The original Birdies slipper solved that issue. However, the brand quickly learned that their shoppers loved their slippers so much that they wanted to wear them outside of the home as well. They were able to pivot, and now make shoes that are as comfortable as slippers to be worn inside and out.
The Retail Essentials
Retail is hard. That’s something we hear from the brands deployed on the Leap Platform again and again—whether we are launching their first branded retail store or accelerating their retail fleet from 20 stores to 50.
Retail is complex, risky, and requires new and different competencies—from knowledge of POS technologies and system integrations, to training staff and even store design. There are no half measures. When a brand invests in retail to accelerate growth and acquire customers, they’re forced to over-allocate people and CapEx resources while taking on real estate liabilities. This can become a distraction from their core business. If all you know is ecommerce and brand building, you’ll have to take time and resources away from these core competencies to get up-to-speed in the retail realm.
Most of all, retail is risky. There’s no guarantee of success. You need to invest in real estate, fixtures, store technologies, hiring and training staff and supporting roles, shipping and logistics, and much more to have a chance at success. But the more you invest, the more risk you take on. Even legacy brands have suffered because they overextended their retail operations. Yet, in today’s growth-oriented marketplace, retail is a necessity. It’s a pillar of success, and brands need not just one store, but many if they want to become leaders in their category.
Today, retail is a necessity. Customers expect their favorite brands to have a physical store where they can try products and have an experience in person. Retail stores act as a crucial billboard for your brand that promote awareness in a crowded and busy marketplace. It acts as a distribution center where you can ship product and returns for an entire geographical market. As the brick-and-mortar success of ecommerce-first brands like Warby Parker, Casper, and Allbirds has proven, retail is now the table stakes for growing modern businesses.
To that end, we’ll be tapping into our expertise launching and managing retail stores to give you the best practices you need to capture success and become a modern growth brand. Here are some of the building blocks for your prospective strategy we intend to explore.
Launching a Store
If you don’t have property, you don’t have a store. You need to effectively find store locations that fit your customers, then sign and manage leases that keep your brand at a financial advantage. Picking the right location for your brand is the most important ingredient for success, and it needs to be done with data and insight—not gut feelings. For most brands, this is a completely new and daunting experience, and getting it wrong can spell ruin for your retail store before doors even open.
Store Design and Layout
Designing a store is as much a science as it is an art. Your retail environment needs to be just as iterative as your ecommerce website, and just as good at driving purchases. Creating a shoppable space requires a combination of elements of architecture, construction, psychology, and aesthetics to build an immersive experience. Every display table, counter, and dressing room plays a role in building an engaging retail store. Your store is an interface for your customers, and like a well-made app or piece of software, you can optimize an experience that encourages product discovery and drives conversion
Launching Your Retail Store
If you want your store to succeed, you need to get off on the right foot. We’ve launched dozens of stores, and have the practical insights on what has to be done. From signage and store WiFi to promoting your storefront, everything has to work. With a robust checklist that takes into account every possible cross-functional consideration, you can open your doors on day one with confidence.
From scheduling staff to setting up POS systems and managing inventory, retail ops is a massive field that can be hard to get one’s head around. The right technologies that can simplify your program, while establishing the right standard operating procedures and training protocols can go a long way towards ensuring success.
How do you serve the right products to the right shoppers in the right way? The answer is an informed, data-driven merchandising program. It’s essential to have the right sizes in stock to maximize revenue, as well as to be developing and presenting products in the most attractive way possible. An informed, diligent approach to merchandising and visual merchandising can ensure you aren’t leaving any money on the display table.
Staffing and Managing a Field Team
Finding, hiring, training, and managing store associates and managers is essential to retail success. It’s also a completely new and different competency to hiring and training a corporate team at your office headquarters. Finding and working with experienced, professional retail associates and managers is truly rewarding, but it’s its own world and takes specialist skills and know-how. Without an excellent and well-resourced field team, your retail store will struggle to delight shoppers—no matter how great your products or location.
Technology and IT Systems
Your in-store technology is a crucial ingredient to success. It connects your inventory to your product on the floor, and is what you need to collect the right data to make informed decisions about every aspect of your business. It powers your omnichannel experience so you can truly stand out. What happens if your store WiFi cuts out, or your price scanners aren’t working? All of these systems and technologies are crucial to keeping your retail store humming along at maximum efficiency.
Promoting Your Store
The Store as an Acquisition Channel
The cost to acquire shoppers with digital and traditional advertising is skyrocketing. Retail can help you find and win new customers for less. This is key to maximizing customer lifetime value and exceeding your financial targets. Managing customer acquisition costs while increasing lifetime value through retention programs and loyalty marketing is an essential balancing act for a modern brand. You need to grow and replace lost customers without neglecting your existing shoppers or overspending on these or other areas of the business. Lowering customer acquisition cost and improving LTV will mean you have that much more breathing room.
Marketing Your Retail Store
Simply being open isn’t enough. Modern growth brands reach potential shoppers with their marketing efforts. Whether it’s geotargeted messages, loyalty programs, or special events, promotion is foundational to your continued business health.
Retail is a relationship business, and clienteling is one of the best ways to build relationships one-on-one. With the right tools and training, your associates can build long-lasting and profitable relationships by simply adding a personal touch to every purchase interaction.
Taking Your Store to the Next Level
The lines between physical and digital retail are blurry at best. Bridging that gap has become the expectation. Shoppers want to buy online, pickup in store, try-on virtually, ship from your store, and return their purchase wherever they can. Your storefront is now as much a fulfillment center as it is a retail outlet. Establishing these systems is key to capturing the future of retail.
Brand Building Activations
Your store is a retail channel, naturally, but it’s also much more. How do you use it as a venue to build a deeper connection with your customers? A retail store can also act as a showroom for potential shoppers, a space for live events, a place to test out new experiences and technology, and so much more.
The Future of Retail
No one can know what’s coming next. But, based on our experience, we have a pretty good idea. We’re making predictions you can bet on and use to inform your retail strategy this year, next year, and next decade.
Of course, this is not everything. Driving growth and customer acquisition through our Platform for omnichannel-enabled retail is what we do. We hope our continued deep-dives into the essentials of retail will be useful as you grow your own store experience.
The Leap Platform doesn’t just set up individual stores for success—as we scale, so do the benefits for every brand we deploy. Our processes become more efficient, our stores of data on different regions and shoppers grow larger, our real estate networks get deeper, and our list of shoppers to market and remarket to gets longer with every new store we open.
The Leap Platform helps you scale your retail channel and acquire valuable customers so you can grow at an exponential rate. Whether your business is a stealth-stage startup or has been established for a century, we’re excited to deploy our Platform to give you the tools you need to navigate this new era of retail.