Are you one of the many retailers currently wishing on a star for sales to pick up? You certainly wouldn’t be alone, with seemingly a new headline everyday about fallen department stores and ailing high street stalwarts. Short of hoping for a miracle, it can feel in retail that there is no way to change your fortunes once they start to dwindle, but this simply isn’t true. What you might want to consider instead of wishing on a star is to follow the lead of the unicorns.
Don’t worry, I haven’t totally lost the plot. There are retailers out there that are making sales happen without the use of fairy dust, a genie, or a magical horn in sight. Rather, these investor-dubbed ‘unicorns’ are startups who have achieved nothing short of legendary valuations of $1 billion - earning them their mythical moniker. So how are they doing it? And what can other retailers, large and small, incumbent and new, learn from these high achievers?
As this article for Retail Dive reveals, there are four startup retailers that have earned the ‘unicorn’ title since March 2019 – Away, Casper, Glossier and Rent the Runway. How? According to managing director of investment firm, D Cubed Group, Glenn Kaufman, by “creating not just customers, but true fans.”
I have written before for this blog about the very different expectations that Millennials and Gen-Zers have from their predecessors in terms of the experience of shopping (if there’s nothing more experiential on offer than a self-service checkout, you ain’t luring them away from online shopping). Yet this idea of making customers your ‘fans’ is possibly even more important when it comes to long term success.
Now more than ever, shoppers care about having an authentic ‘relationship’ with the brands they shop with. They believe that this relationship should be a two way street whereby their brand loyalty is rewarded by brands hearing – or correctly predicting - their wants and needs, and reacting to them.
Away, for example, is on the face of things a seller of luggage. Its founders, however, recognise that suitcases are, after all, two-a-penny, and so that to be successful the Away brand needed to mean more to its customers. Away has brought loyal customers onboard by bringing them along on its journey and allowing them to help shape the offering. Now expanding into apparel and wellness, the company is extremely proactive in seeking out customer feedback to understand what they want and need before developing new product lines. You can see how a company that sells products that its customers feel they have had a hand in shaping, and which cater directly to their needs, is able to foster and retain such loyalty.
Another part of the development of this ‘fanbase’ is helping customers with problems that they really care about. Take Casper by way of example. This company didn’t just set out to ‘sell mattresses’ (although they certainly do so), it set out on a mission to make sleep cool again. Far from simply flogging its products to whoever happened to need a mattress and hadn’t already been cornered by an over-eager DFS salesperson, Casper found a purpose for itself as a total sleep companion. And who cares about sleep? Millennials who aren’t getting any. It’s no wonder, therefore, that they are so loyal to this brand that is committed to the cause of helping them get some much needed shut-eye.
So there you have it. It turns out it really doesn’t take a miracle to become a unicorn. But these unicorns can share some valuable lessons in what it takes to develop your own brand-loyal fanbase of committed followers. ‘Selling stuff’ on its own is no longer enough, but neither is the opportunity for success merely the stuff of myths and legends. It’s all about relationships, authenticity and committing to a cause. That’s the real magic potion - no unicorn horn powers required.
Comment