There are several new, bestselling brands that seemed to have come out of nowhere to turn into “overnight successes”. They’ve learned how to cleverly leverage everything from distribution to cash flow to catapult sales. Let’s take a look at the seven characteristics these fashion brands share so you can apply them to your business.
1. Flourishing Brand Loyalty
The best brands that thrive – season after season – are the ones that create connections with their customers through consistent brand touchpoints. Brand touchpoints can cover social channels, pop-up shops, event marketing and both print and digital paid marketing.
Two brands who are doing a clever job at taking press and flipping it into paid digital are The Arrivals NYC and American Giant. The Arrivals NYC is doing a kick-ass job with paid marketing on Instagram. I love how they are taking one piece of press (a write-up from Vogue) and using it to drive conversion through the platform. The Vogue write-up was based on buying your new perfect leather jacket. American Giant has also done an amazing job of leveraging a write-up on Slate and using it for advertising on Forbes. The write-up was about American Giant having the most in demand, perfect sweatshirt.
2. Slow and Steady Distribution
Drop shipment and consignment can make it easy to be in many retailers at once, but this won’t pay the bills. Deliberate distribution can be the difference between having the cash flow to continue production season after season or running out of funds.
Mansur Gavriel launched smart. They started selling at Capsule trade show and instead of letting retailers dictate payment terms they asked for a percentage down with the balance on NET 30. Retailers that couldn’t hang, didn’t, and that hasn’t slowed down this hot brand.
3. Strong Leadership
There are so many decisions that need to be made when running a business. Without a competent leader, there is no head to the ship and responsibilities can be deflected very quickly. Businesses that have multiple founders need to be very careful. It’s important not to have too many redundancies in core competencies. While you all may want to chime in on a particular decision, someone eventually needs to make it and they need to be empowered to do so.
Fashion brand Rhode is an excellent example. Founded by Purna Khatau and Phoebe Vickers, this team divides work and conquers. With one half focused on designing and merchandising, and the other half focused on business development and sales, this team has been able to triple their sales in just a year. If there was no autonomy, how on earth could anything get done?
4. Organized, Strategic Operations
Have your shipping and logistics on lockdown. Brands that sell know how to ship. To scale up orders and get repeat customers make sure your packaging is on point and you have a distribution center set up. Don’t prematurely move to a 3PL (third party logistics) provider until you have a sales/marketing/PR strategy in place (so you know’ll when to anticipate sales).
Do your research so you know who you want to work with when the time is ready. Have at least three conversations with logistics providers. If you get stuck, shoot us an email at email@example.com, we’ve got a kick-ass ops consultant to set you up properly.
5. End Game Aware
Do you want to sell the brand? Will you always be the head of creative? Understanding where you want to take your business will help you make the right decisions. Brands that want to sell to national department stores versus boutiques take different steps to get there. In order to be a brand that sells and is successful, you have to know the end game so you can make it happen.
6. Consistent Messaging
Yes, there are lots of things your brand could be, but stick to the main message. If you are focusing in the environmental sector be clear about what that means to the brand. Your brand story should be able to hold the collection and marketing for seasons to come. Create a brand bible and reference it as often as you need to get to know the difference between your preferences and how the brand develops its own identity.
Five years down the road you may have a brand that develops a strong following, but your own personal aesthetic may have changed. Your customers may not be ready to grow up with you, so a tough call will have to be made. Risk losing them or continue to create what you know will sell. Brands that stick to the key message become staples.
7. Money Smart
You don’t need to be a CPA to know that money in the retail industry is funny. It’s funny because wholesalers always ask for discounts, they don’t always pay on time, they sometimes cancel orders and you have to invest money into production of samples and production way before you see a penny of sales. E-commerce money is also very risky; you are placing your own buys against sales on your site, so you’ve got to have a plan to get those sales. Do it right and you may see a 70% full price sell-through, do it wrong and you may need to have a steep markdown season to clear out merchandise.
Unlike the restaurant industry where you can get cash in hand the same day, the retail landscape requires balancing a tight rope of cash. In fact, even companies that sell $200M a year (a la The Honest Company) aren’t even profitable. To be a brand that sells you’ve got to have a grip on what cash you need to survive. If you don’t have cash to produce, you can’t sell. If you don’t have cash to produce content and to market, no one will know you exist. Understand money and prepare- this is the key to longevity.
So there you have it, these are the seven characteristics of brands that are selling like crazy these days. Get to work on transforming your brand – step by step – and you’ll really start to feel the results!
Whether you rely on your own retail shop or wholesale fashion accounts to thrive, it’s time to stop choosing between brick-and-mortar and e-commerce strategies. At the end of the day, it’s all simply retail and shoppers respond best to a healthy mix of the physical and digital worlds.
Alibaba Makes a Case for Merging Physical and Digital Commerce
Alibaba is probably the largest retailer who has tossed the idea of “omnichannel” right out of the window. And they continue to grow at an impressive speed. They started with the purchase of a major retail brand in China in 2015 followed by a recent $2.6 billion purchase of a Chinese mall operator – complete with 29 department stores and 17 shopping malls across various cities.
Their CEO, Daniel Zhang, has made their plans clear: transform physical stores to reach modern shoppers’ standards using their digital cache of resources (improved inventory management, real-time customer insights and data, digital payments, et al.). The plan is to introduce new customers to the offline shops, while strengthening their overall business. Zhang says: “We don’t divide the world into real or virtual economies, only the old and the new”.
And really, shouldn’t that be the accepted idea of retail strategy across the industry? Brick-and-mortar shops hanging on to old business models and old ways of doing business are really feeling the burn. The same goes for digital businesses that don’t consider what actually happens with customers when they shop offline.
E-Commerce Stores are Opening Brick-and-Mortar Businesses
Don’t let headlines about struggling retailers fool you. Brick-and-mortar still works. Just look at the number of e-commerce shops arriving offline. We’re seeing fully operational stores, short and long-term pop-ups and even offline showrooms all over the country. These brands include Bonobos, MM. LaFleur, Reformation, and Warby Parker.
Bonobos’ Guideshops don’t sell any physical products but they’re the hubs to place online orders, confirm fit, receive style advice, and make easy, in-person returns. MM. LaFleur takes advantage of the best aspects of traditional stores but with a contemporary and digital twist. Their showrooms offer pre-pulled, personalized looks, styling sessions, and accompanying glasses of champagne – an excellent way to bridge shopping with experience. Reformation’s concept is more like a hybrid of both worlds with limited quantities of merchandise and digital screens for online shopping in store. As for Warby Parker, they plan to open at least another 25 shops this year!
Touch Is Only Human
As a species, we’re totally wired for physical touch. Touch is linked to our behavior, emotions, and crucial development. There’s a study that’s widely referenced in retail to translate the science. It was published in the Journal of Consumer Psychology in 2014 and it explains how using a touchscreen interface emphasizes the benefits we experience when we get something new. We psychologically perceive that we own whatever we touch! That means we get the benefits of retail therapy – even before we buy!
The great news is the same research has been correlated to touching other physical objects in stores so every brand has the chance to benefit. Since touch is a natural instinct that brings on positive emotions, it’d be totally irrational to move all of our sales online. We have to embrace technology and the physical world to really maximize the potential rewards. And there are really so many possibilities.
Brick-and-mortar isn’t dead. And e-commerce sales are only one slice of the retail pie. We have about 19 hours a day to create valuable, offline engagement so let’s leverage what we’ve learned to ramp up the real-world retail experience.
Innovation has changed everything and at the same time, nothing at all. Technology, marketing, and shopping habits have changed but we still crave a social experience. Our desire to connect as a community is just as powerful as it was in the height of the department store heyday. Shops got their start as places to gossip, socialize, and relax and today’s stores are still great places to congregate. Digital has only expanded the size of this community, taking it to a worldwide scale.
We still need human touch and in-person interaction… physical stores will always be around. The shops that will survive will use digital to stay connected and improve the ways they engage. They’ll use digital to offer additional brand touchpoints and to deepen relationships with their customers through increased “face time” and additional outlets to share their stories.
You have to be where your customers are. Shoppers may not always make the sale offline but that doesn’t mean their in-store experiences won’t lead them to online sales or digital brand advocacy later on. We have to see retail with a much more holistic view.
Be open to change and nimble to react because if there’s one constant in fashion, it’s CHANGE.
Don’t worry, slow selling seasons are completely normal realities of retail! Here’s how you can use them to your benefit…
There is a LOT to be done when it comes to launching and running your fashion brand. If you’re looking for a co-founder, use this criteria for a successful search.
Fashion startups! This business is tough but it’s even more difficult if you don’t take the time to master the basics of retail. How well do you understand your fashion business? There’s a lot more required for retail success than having beautiful products, inspiring photography, and a creative brand voice. These are all important considerations but you have to take charge and be just as effective with the business side as you are when it comes to design.
This is what I teach in my 9-week program- Fashion Profit Plan: Fundamentals. In 3 months’ time, you’ll master every aspect of retail and immediately be able to put what you’ve learned into action. You’ll also have access to resources and templates worth $1,000s, weekly group coaching calls, and 3 one-on-one strategy sessions with me so we can develop and discuss unique game plans for your brand.
Here’s a couple of lessons based on some of the retail essentials you’ll explore in the program: Cash Flow, Competitors, Customers, Wholesale, and CEO Advice.
A lot of you are probably coming from strictly creative backgrounds so cash flow management can be especially intimidating. Don’t stress out, you can still become a cash flow pro. You just have to understand the essentials – why you need to know it, how it works, and how you can use the insights you gain in the process.
For the newest startups, cash flow is particularly complex. Why? You don’t have any sales history to reference. You need to project your expected future expenses for the next 3 years… project too high and you may think funding is out of reach, project too low and you could face lots of future unexpected costs.
As you project your future expenses, the most important costs to include are professional fees (lawyer, accountant, etc.), office space expenses (rent, office supplies, printing costs…), product samples, professional photography, and digital marketing campaigns.
How you plan your finances depends on a lot of different factors like the number of collections you’ll produce each year and the type of resources you can score for free!
You wouldn’t believe how many brands say “I have no competition”. That’s never true! Your customers (individual shoppers and wholesale buyers alike) have plenty of options of where to spend their money so even brands with the most unique designs still have competitors. Build a competitive matrix to understand what options your customers are choosing from and how your brand fares sitting next to the competition.
There’s a lot you can do with your Competitive Matrix including… indexing pricing, identifying potential wholesale accounts, gaining website and branding cues, gleaning copywriting inspiration, and deciding how many styles/SKUs to produce.
You have to be able to accurately identify your customer in order to get the right marketing and sales strategies in place as well as to develop your product assortment in a direction that makes sense. Those outdated, generalized customer profiles don’t work because they’re way too broad to be useful. It’s time to get specific.
As a startup with no sales history, you can look to your direct competition for answers.
Where are their products sold? Where are they getting press? Who follows them on Instagram?
Instead of a customer profile that looks like this…
25-30 years of age
Lives in Urban Area
…it will be much more precise (and useful) like this…
Reads Porter Magazine, shops at Barneys New York, follows celebrity architects on IG, follows brands like The Row, Sophie Buhai, and Jil Sander on IG.
Your research should also leave you with key insights like additional competitors you may not have discovered before, magazines, blogs, and influencers relevant to your target customers, and potential shops to approach for wholesale business.
Use this formula for wholesale success: Product + Pricing + Persistency + Proof.
Product: Create your product perfectly – read: based on your audience.
Price: Use competitive pricing.
Persistency: Be strong. You need a thick skin to navigate the rejection-filled world of wholesale pitching. And always remember that no doesn’t mean no. It means not right now. Be persistent. Keep emailing, calling, and sending out those postcards.
Proof: Build social proof. Instagram should be your #1 channel as a fashion startup. Post 3x a day and maintain a balance of lifestyle, brand, and product images. Actively engage with your audiences! Buyers want to see that you have a market for your brand.
Even if you have 0 management experience, as the founder of your fashion brand, you are the CEO. It can feel strange to think of yourself as the top executive in charge but that’s exactly who you are.
The future success of your business relies on your ability to manage yourself and others with confidence, smart decisions, organization, and strategic delegation. Yes, even if you only work with 1, 2, or 3 other people, these are all crucial skills – planning, goal setting, negotiation, scheduling, and adopting the right tools.
As a fellow CEO, I know how it goes. I also love what I do and I’ve been guilty of working around the clock from time to time. The truth is, balance is important for your health and the health of your company. The CEO needs to be well-rested, healthy, and sharp to continue to make the right moves. You need to commit to a 30 minute lunch break and even a time to call it quits for the day. If not, things can really get out of hand!
Learn actionable insights about these aspects of your retail business and more (including pricing strategy and e-commerce) in Fashion Profit Plan: Fundamentals!
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You are launching your startup fashion brand and you’re pumped up to start pitching. Top of mind is how to best position your brand to wholesale buyers. Often misunderstood, the job of a buyer is not only to look and find cool new products but really to act as an investment banker. Much of what a buyer has to do with wholesale fashion is financially motivated, based on margins, probability of sell through at full price, and minimums. At the same time they are getting that information of ‘sellability’ from a variety of sources. Read on for the five ways to make your brand more sellable to wholesale accounts.