A handful of young, successful singers and actors have ventured into the activewear sector of the clothing industry over the last few years. All of those stars have a recognizable look and name. Kate Hudson is one of those young stars. Hudson has made her presence known in the clothing industry by teaming up with JustFab, the billion-dollar player in the rag market. Hudson and JustFab combined forces and introduced Fabletics to the world in 2013. Fabletics offers trendy activewear to women and men that want quality at a decent price. The Fabletics model is simple. The company uses a subscription-based model to sell its brand to customers that want comfort, quality and the right look for them. Hudson’s exclusive designs and the attention to detail has made a huge impact in the marketplace. In three short years, Fabletics has been able to build the company into a $250 million powerhouse.
Most of the revenue has come from online sales over the last 36 months, but the recent addition of brick and mortar stores is changing the dynamics of the company. Fabletics wants to open 75 to 100 stores in malls across the country over the next three to five years. The company has 16 stores in Hawaii, Florida, California and Illinois now, and sales have been better than expected. The General Manager of Fabletics, Gregg Throgmartin, believes his company is building a modern version of high brand value. The membership model is giving customers personalized service, value, and up-to-date fashion at very competitive prices.
It may sound strange to some people, but building physical stores is a trend for big online retailers. Amazon is jumping into the brick and mortar business, and so are other recognizable online companies. But Fabletics has something Amazon and the other online retailers don’t have. Fabletics promotes reverse showrooming, according to a recent Forbes article. Browsing is a positive in Fabletics stores. Three to five people that walk into a Fabletics store are already members. And another 25 percent of the people that walk into a store become members. Customers that try on a particular outfit in the store, will find it in their online shopping cart when they get home. That means the customer has the option to buy the outfit in store or online at a later date.
There are other innovative things that make Fabletics stores a win for the company. Using online data to identify customer preferences in particular areas is a brilliant move. The company only stocks merchandise that appeals to that local market. Stock choices are based on local customer input from the database and from retail sales. The other thing Fabletics has going for its retail ventures is accessibility. The location choices and the smart distribution system, as well as fast purchase options, are the things that gain customer appreciation and more sales.
The executives at Fabletics know there are challenges in brick and mortar stores, but they believe their business model will eliminate many of the issues that have plagued typical retailers over the years. Plus, Fabletics has Kate Hudson. And she is a powerful marketing force.
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