Surviving the “commerce apocalypse”
Ministry of Supply and Kendra Scott founders talk to Glossy about how to make retail work in 2019
I’m probably zeroing in on the things that I agree with already but here’s what stood out:
With its first stores, Ministry of Supply tested the guide-shop model, with small, intimate stores that forced connections with the staff. “The P&L was awful; it was wildly unprofitable,” said Advani. “The assumption was: People are getting this great in-store experience, and then they’re going online to buy. But that’s really hard to track. And at the end of the day, the online channel wasn’t profitable either.”
In early 2017, the brand followed up with a second attempt at offering a unique experience, installing a costly 3D-printing machine in its Boston flagship store, with the intention of printing knit blazers for shoppers on the spot. Since, the machine has moved on from a customization station to more of a conversation starter. The experience offered is simply the chance to gain an understanding of the brand’s supply chain through store associates and visual cues.
“The No. 1 thing we invest in now is education and staff, over any kind of trinkets, gadgets, experiential anything,” said Advani. The in-store staff is trained on the company’s sustainable production methods, including 3D printing which produces zero waste. 3D print-knit pieces are displayed around the printing machine to complete the picture.
“At first, [the printer] was about getting people excited and making cool headlines, and waving a bunch of money,” said Advani. “But the machine’s old, it’s prone to accidents, it needs a technician nearby. Once you get past the honeymoon phase and the novelty wears off, it’s kind of like: What’s the lasting impact?”
The brand has come to think about its seven stores as both businesses and experiences, never one more than the other. The current focus is to ensure each store is profitable within its four walls, with its impact on online sales merely a bonus.
“Adding experiential components for the sake of adding them is never going to compensate for a poor value proposition or a lack of good product, or a lack of something that resonates with the consumer,” said Jon Weber, head of global retail and consumer practices at L.E.K. Consulting. “Maybe, at best, it will drive a little bit of traffic, but if it doesn’t have adjacency or make sense in relation to the brand, people won’t stick around.”
Weber pointed to the many off-price retailers, like T.J. Maxx and Marshalls, which are “bare bones” in terms of any experience offered, yet thriving.
“They work because the product is good, the brands are great, the price is right and inventory is flowing through, so it’s a new store every few weeks,” he said. “But take the clothes out of there, and it’s a pretty ugly store. That goes to show that you don’t really need those other things. And stores that have gone bankrupt, like a Charlotte Russe — a bell or whistle or new technology wasn’t going to save them. What’s at the core is what matters.”
I worked extensively on consumer brands that sold at retail from 2016–2018 and what they repeatedly wanted were things that looked “experiential”—live art and interactive displays being the most common, but those only entice people to make a trip if they’re massively immersive (like the kind of thing that gets posted on Design Boom or Thisiscollossal). Otherwise it comes down to the obvious—exclusive product*, celebrity appearances, or a party. As Aman Advani of Ministry of Supply puts it early in the article, “Everything is changing, and at the same time, nothing is changing”.
*One of the things I saw routinely was brands trying to give the implication of exclusive product rather than just doing it right and giving a store an exclusive, or weirder still, having an exclusive colorway of a sneaker at Foot Locker but then we couldn’t say it was exclusive so as not to upset, say, Champs. WTF.
Thumbnail photo by Dan Keck