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What’s new in UK retail’s online-to-offline movement?

US menswear retailer Untuckit used to be an online pureplay, but by the end of 2019 it will have 80-plus stores, including its two new UK shops, as the online-to-offline trend continues

“When we are talking to investors, no one can wrap their arms around what we do,” says Chris Riccobono, co-founder of US clothing retailer Untuckit.

“When you think about it, we’re the first men’s apparel business to do what we’ve done – convert a successful e-commerce proposition into what will be 80-plus stores by the end of 2019.”

Riccobono adds: “When people have been looking at companies for ever and the usual comparatives, they don’t understand what success is for us – what should store growth and e-commerce growth look like?”

Apart from confusing potential investors, Untuckit – which sells men’s shirts designed for wearing untucked, as well as a selection of recent new ranges for men and women – is gearing itself up to make its mark outside North America for the first time.

On 6 November 2019, the retailer, which until now only had stores in the US and Canada, having originally launched as an online pureplay in 2011, will open in Covent Garden and Westfield London. It is the latest example of a digital-first retailer in the UK putting brick and mortar at the heart of its plans.

The Untuckit story

Untuckit opened its first store, in New York City, in 2015, and focuses on providing a simple, straightforward retail proposition. Riccobono – who founded the business alongside Aaron Sanandre – says the company does not invest in elaborate store fit-outs, suggesting that its key male customer wants limited fuss.

Although the retailer targets a wide age-range of men, from 25-year-olds to octogenarians, Riccobono says there is an overriding wish among them for store-based retailing in some form.

“We found early on that a large percentage of men will not buy a product unless they can touch it and feel it,” he says.

“The older you are, the more you want to go to brick and mortar rather than online. We knew we needed stores, and it is great for long-term value because if you come to store, you get more attached to the brand, and the chance of you staying with the brand increases.”

Many of Untuckit’s traditional online customers go into the store “for the experience”, says Riccobono, which often includes the serving of Scotch whisky and other refreshments, but the shops ultimately aim to help customers understand fitting and make sales.

“There’s no rhyme or reason, but our customers go back and forth between stores and online”
Chris Riccobono, Untuckit

Importantly, perhaps, Riccobono and his team are not getting het up about focusing on one channel over another. In the US and Canada, where Untuckit currently operates 75 stores and online operations that sell shirts in 50 different sizes alongside 12 other product categories, there is apparently a symbiotic relationship between the two.

“We have a true omnichannel business – there’s no rhyme or reason, but our customers go back and forth between stores and online,” says the co-founder.

“We think of omni as convenience – we want people to get their shirts wherever they are, whenever they want and however they want.

“That’s important because some companies are trying to push people online or to stores, but we want the customer to buy from wherever they want, so we don’t think about it individually. If stores don’t grow but they serve our customer who goes to buy online five times, we’re very happy with that.”

Over the coming year, Untuckit expects to experiment with new technology in its stores, including barcodes that shoppers can scan to find more product information, as well as introducing click and collect, but straightforward customer service remains a key goal.

Made for physical retail

Online furniture retailer Made.com is also trying new things in the physical space, but, unlike Untuckit, its digital roots are very apparent in its sites.

It has had showrooms for several years, but the opening of these showcase spaces is now an increasingly integral part of the company’s strategy when expanding into new territories.

The company says it has learnt from previous mistakes in brick-and-mortar retail, and chief creative officer Jo Jackson says the design-led brand – which refers to itself as a technology company – continues to evolve its model.

“We’re just trying to make sure we’re thinking as consumers, rather than as a store designer, a customer service provider or a digital tech provider,” says Jackson.

“We’re thinking with our consumer hat on about what we want, do we care what tool we’re using right now, where do we want to be talked to and what would we find helpful?”

Jackson says the showrooms are designed to cater for four different potential customer groups.

“We’re just trying to make sure we’re thinking as consumers”
Jo Jackson, Made.com

Moving away from the traditional socioeconomic demographics that have shaped general marketing techniques for years, she says the stores suit a tech-enabled solo visitor in a hurry, a couple excited about the home, and “a physical experience, but you’re acting like you’re online”.

“We also cater for the technophobe,” she adds.

“Being a tech business, this was something we failed at originally because our tech-enabled showroom experience meant visitors had to interact with tech to get any info from our physical spaces.”

The reference to failure relates partly to Made’s original London showroom at Notting Hill Gate, which required visitors to check in to a tablet device, which was then used to scan products as they moved through the showroom. Users entered their email address at the end of the experience, and so the retailer had a digital trail of the consumer’s interests, which could be used for follow-up and retargeting.

Jackson acknowledges that many customers did not like the process. Instead – and this is evident in Made’s recently refitted London Soho space – technology can be used if required, rather than being a prerequisite of the visit.

There is an element of gamification in the showrooms, where visitors can pick through other customers’ Instagram feeds displaying Made furniture. It’s called Find Your Style and helps the retailer recommend items that match shoppers’ style preferences.

There is also a heavy digital signage presence in the showrooms displaying current deals, brand messaging and other signposting, which ensure Made underlines its credentials as a tech company.

Jackson says: “There is also a nod to our direct-to-consumer position by having Shop Instagram on big touchscreens, which links customers to our digital world and gives us more opportunity to showcase styles in a relevant and relatable way.”

Pop-ups plug a gap

For those digital retailers not willing to make a permanent commitment to bricks and mortar, the pop-up is a tried and trusted method to dip your toes into this new world.

Made, itself, is looking to open more temporary showcases for its furniture and furnishings – on canal boats, in treehouses and in apartments.

Online marketplaces eBay and Notonthehighstreet.com are among the companies to have trialled temporary physical space during past Christmases. Online furniture retailer Wayfair opened a London pop-up in August this year, with the aim of giving consumers a taste of its festive product range.

And buy now, pay later platform provider Klarna even hosted several of its e-commerce pureplay partners, including ASOS, Beauty Bay and In the Style, in its Manchester “House of Klarna” pop-up at the start of October.

Consumer electronics e-tailer AO.com is also considering the potential of pop-ups, although it does not have definitive plans.

Pop-up power was a subject that came up at the Retail Connections event in London on 16 October. Rob Feldmann, CEO of discount designer fashion e-tailer BrandAlley, ruled out opening permanent stores, but was more positive about pop-up potential.

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“I think there’s definitely a way of increasing your brand’s awareness with selective pop-up stores,” said Feldmann, who added that he would “never” consider permanent stores and the associated long leases that come with them.

It is understandable that e-tailers tread with caution as they look at the pressures caused by rising rents and rates for store space that have contributed to the downsizing and, in some cases, complete collapse of multiple chain retailers in recent years. But there does appear to be rising interest among them in testing the physical retail waters, as more and more organisations note the customer benefit of bricks and clicks.

Cost issues have put paid to any imminent plans that fast fashion e-tailer Missguided may have had to extend its UK store estate. Instead, it closed its Westfield Stratford City store earlier this year, and now just runs its Bluewater shopping centre space.

The Manchester-based business said in January that it was in “transition” as it looks to turnaround significant losses for its 2017-18 financial year, caused partly by the expensive store ventures but also “premature” senior hires.

Untuckit in North America and Made are examples of online-first retailers seemingly navigating a successful path in the physical retail world, although Untuckit’s physical retailing journey in the UK is only just beginning.

They have a laser-focused eye on consumer behaviour in common and, more specifically, they understand what their particular customer bases need. They are two companies arguably pointing the way for other digitally-focused players to follow.

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