Ah, 2011: Will and Kate got married. Navy SEALS took out Osama bin Laden. And a little video conferencing startup later to be known as Zoom found its footing.
Ten years, then, can seem both a lifetime ago and a blip — especially now.
Is it a surprise that 2021 marks the 10th anniversary of brands such as Dollar Shave Club, Stitch Fix, HelloFresh, Chewy, Poshmark, The RealReal, The Honest Company and BHLDN? Is it more of a jolt to remember that ecommerce in the fourth quarter of 2011 accounted for just 4.5 percent of total sales?
“It was the beginning of the digital world,” says Marshal Cohen, chief retail industry advisor at The NPD Group. “And phones became strong enough, big enough, as powerful as some people’s laptops. That mobility and ease of access also made some of these businesses become very accessible.”
Learn more about the ways advancing technologies pushed digital retail to new heights here.
The opportunities weren’t just on the consumer side. In 2011, Cohen says, the burgeoning digital space made starting a business — or taking a traditional business online — affordable and approachable. Subscription models and auto-renewals helped companies add longevity and revenue, all while holding consumers’ interest. And then there was the growing use of social media.
“You could run your business out of your garage on this digital platform, and be perceived by the outside world as being as big as a behemoth brand,” he says. Gaining recognition then was about guerilla marketing. Today, however, making it — and continuing to make it long-term — is more about being nimble and adaptable to the changing market. The last year, he says, has been a perfect example.
“You can no longer be a one-dimensional, one-trick pony,” Cohen says. “You really have to be able to expand your product, expand your marketing, expand your execution.”
The importance of data
Each of the 10th anniversary businesses has done just that: demonstrated an ability to shift and adjust while holding true to its original, clearly defined purpose. In many cases, data has played a key role.
Stitch Fix, for example, speaks of its “successful first Fix” measure: the percent of clients who purchase at least one item in their first curated collection of clothing and look forward to the next one. In Q1 Fiscal 2021, ending October 31, 2020, as well as the quarter prior, nearly 80 percent of the company’s first Fixes met that criteria, the highest level seen in five years.
“We have shifted our inventory to meet the customer in the moment, and we’ve improved our recommendations by leveraging our growing data set to bolster our ‘style graph’ and power our algorithmic models,” the company conveyed in a shareholder letter. “We believe that establishing a favorable first Fix outcome is a strong indicator of future client engagement and retention that will serve as a tailwind in the quarters ahead.”
Dollar Shave Club, meanwhile, is celebrating its anniversary with a shift to omnichannel, as well as a new CEO, logo, color palette and acronym: DSC. Walmart began carrying DSC’s razors and shave aid products in late 2020, with more than 10 retailers such as Target, Walgreens and Rite Aid to follow suit early this year.
DSC has always been — and will continue to be — a brand that makes it OK for men to talk about grooming. But founder Michael Dubin has said that being a “digital-only brand doesn’t reach everyone with the mission to be their best selves.” Dubin told WWD that the move to omnichannel had been in the works since Unilever acquired the company in 2016, but conversations became more serious in early 2019.
Then there’s HelloFresh, based in Germany but serving about 5 million customers in 14 countries. In late 2020 the company said it aimed to grow annual sales nearly three times above its targeted 2020 revenue levels in the medium term by offering more products and expanding to new geographies. That’s no short-term bump; HelloFresh also noted it will continue expansion to one or two markets each year until 2025.
Manish Chandra, founder and CEO at Poshmark, says that over the last decade, his company’s community has grown to 70 million registered users, “and we are so honored to serve them every single day.”
“When we started, we focused on women’s fashion and products you could easily source from your closet,” he says. “From there, we expanded into men’s and kids. In 2019, we launched in Canada and added home goods to the platform, and in 2020, we expanded into beauty and wellness. Most recently, we launched pets, giving millions of pet owners a simple and sustainable way to shop and sell. As we continue to grow into new categories and regions, we remain dedicated to our mission of putting people at the heart of commerce and in doing so, empowering everyone to thrive.”
“Many trends are led by younger generations such as Millennials and Gen Z who continue to grow their spending power as they age.”
Manish Chandra, Poshmark
Since day one, he says, “we’ve been focused on building a marketplace that’s social, in order to make shopping fun and human again, sustainable, both socially and environmentally, and data- and technology-driven, to make it simple and easy for anyone to discover, shop, buy and sell.”
Chandra credits the intersection of three key trends for Poshmark’s staying power: the shift to online, the shift to social and the shift to secondhand.
“Many of these trends are led by younger generations such as Millennials and Gen Z who continue to grow their spending power as they age,” he says. “As online shopping increases in popularity and consumers continue to focus on reducing overall consumption, Poshmark is championing a purpose-built community and environmental sustainability at a massive scale. As a result, I believe the future of shopping is both social and sustainable.”
Add one more thing to that list: increasingly complex. To buy a watch in the past, Cohen says, a consumer would go to a watch company. Today, however, there are a multitude of other options — and no telling what the next decade will bring.
“Being able to understand the environment you sell to is no longer a simple, one-lane highway,” Cohen says. “It’s now a superhighway — with toll bridges all over it.”