The impacts of COVID-19 on consumers provided many retailers with new data and opportunities to meet more precise needs and grow a more sustainable business. Goodlife Clothing, established first as a wholesale brand, focused on building a brand that consumers could identify and trust. The brand used lessons learned and the community it built through selling through Nordstrom and direct to consumers online to build an even stronger omnichannel presence that is growing as it opens more bricks-and-mortar stores throughout the country.
Join us at NRF Nexus 2022 where we dive into the future of retail and innovations around the customer experience.
Co-CEO Andrew Codispoti joins this episode of Retail Gets Real to discuss the omnichannel business and how the company grew. Goodlife expanded into physical retail during a time when non-essential bricks-and-mortar retail was halted, and Codispoti says the brand found success in building trust in online channels first.
“The biggest lessons are to do as much as you possibly can in-house,” he says. “People need to own their data, follow the data and as quickly as possible gain in-house expertise, so they have the DNA of your brand and really speak in your authentic voice.”
In building the store experience, Codispoti encourages a data-driven approach. “Just like in online, just like in DTC, you have to follow the data,” he said. As Goodlife refined its physical spaces, it noticed stores bringing in new customers, and customers with a greater lifetime value, for about equal the true cost of acquisition online. “In our first few locations, we realized about 85 percent of the customers are still new customers that are walking in these stores. So it's a phenomenal acquisition channel,” Codispoti said.
Tune into the episode to learn more about the Goodlife brand and lessons in building an omnichannel business for success.
Bill: Welcome to Retail Gets Real, where we hear from retail's most fascinating leaders about the industry that impacts everyone, everywhere, everyday. I'm Bill Thorne and on today's episode, we're talking with Andrew Codispoti, Co-CEO of Goodlife Clothing. We'll talk to Andrew about the company's omnichannel business model and why it’s now investing in opening stores around the country.
Bill: Andrew Codispoti, thank you for joining us today.
Andrew: Thank you for having me, Bill. I hope I can live up to the moniker of a fascinating leader in the space.
Bill: I think you won't have any problem because you've got a great business. So how do you describe Goodlife to those who aren't familiar with it?
Andrew: Yeah, Goodlife is a premium essentials business in the sense that we're you know, we make premium clothes on a more commercial level. Not luxury per se. It's accessible price points, but we offer an exceptional price value relationship on your wardrobe essentials.
So think, your t-shirts, your sweats, your foundational garments.
Bill: How did you get to this point in your career?
Andrew: Well, I've had an interesting path. I am the Co-CEO of Goodlife Clothing. My business partner, he really grew up in fashion business from a young age. His father ran Hugo Boss North America. So he really grew up in the business and he was tapped to launch a line for John Varvatos in his mid-twenties.
And by the time he was in his early-thirties, he was running the men’s business in Michael Kors. I grew up with my partner and, he's toyed with an idea of having an apparel company, Goodlife Clothing for quite some time. He even trademarked the name back in 1999 and had little kinds of grassroots.
Early on while he was, you know, still in different iterations of his career. I had a Wall Street career and background. I was a salesperson and a trader. I was a partner in an investment bank and he had come to me at a time I started to do some private investing in CPG.
And, he needed some angel capital to really start the business in earnest and do it in a real way. So he kind of, you know, he embarked on that journey in more of a traditional way, selling wholesale accounts really refining and perfecting a product, which sounds intuitive, but in a strange way in the proliferation of DTC companies over the past decade or so, there's a lot of companies that, you know, there's sort of tech first, product second, and were able to access a lot of VC funding from more tech-oriented investors.
Andrew: We went a traditional approach. It was, truly, somebody that came from the industry that understood product, understood white space in the market. He had felt that, customers were essentially being abused by a lot of the more legacy players. And then a lot of these GCC companies didn't actually understand fashion and apparel.
So what he set off to do and what I, in the initial phases of it funded in the first few years of this business, was to create a company that would be a year round resource, where, you know, we always had a bent to be narrow and deep and be a category killing you know, especially Jersey brand and really perfect, the perfect t-shirt, which is easier said than done.
Andrew: It comes with premium fabrics, the right silhouettes. The fabrication is everything. That's why we have such an incredible durable product. Fantastic can feel that, you know, is slowly built a cult following the initiative was always to be an all door resource at a, at a premium retailer.
We have, we have a large Nordstrom business. They've been a fantastic partner. you know, we've been an all door resource at Nordstrom, being a replenishment type, business where, you know, plus 80% of what we sell is core year round product that people keep coming back for. So in a way we're a CPG-like apparel business in the fashion industry, it started off slowly. I was kind of. Always there helping out sort of acting like a de facto CFO. and then a few years ago, I came on board to run the company with, with him as, as we really start to hit an inflection point. And we started to, you know, access different avenues of capital and the business became more dynamic.
Andrew: And frankly, I was attracted to, you know, not only this, this, our baby that we, that we created together. but building a real business and, and you know, kind of accentuating our, our voice and our ethos. And it's something that really took the life of its own. I'm quite proud.
Bill: It's a great story. I'm sure that you didn't think that you'd wind up someday as a retailer, per se.
Andrew: No. if you look back in my early days, dreaming of what I was going to be in life back in my high school and college days, I thought I was going to become Gordon Geto.
Bill: Chose the right path.
I think so, you know it's funny because the product kind of coincides. I think our own personal journeys where, you know, become little bit more, you know, ego, vanquishing, and, self-actualized.
Andrew: And I think a lot of people go through these, phases where they experience success early in their lives, in their twenties, early thirties, and you start to recognize what's important in life. You know, we have a company that, we make beautiful, simple clothes for authentic living. You know, we're not a big logo driven brand.
We do collaborations with people we believe in whether not just because, you know, they're famous, we're not paying people in a, in a genuine way to. You know post our, our clothes or pretend to be brand ambassadors. all of our efforts have been organic we've we really, from a very early stage had a, had a cult following that's enabled us to, not go the root of a lot of companies.
Who've kind of been led astray by large capital providers and they kind of lose touch with what their company is and what it means. And they start sort of chase, what's in Vogue and what capital thinks it wants. Its enabled us to take an omnichannel approach from a very nascent stage.
We, we started at wholesale, that gave us a ton of, market validation that was overlooked for a period of time. I think, where, you know, these retailers will only buy superior product. And if you have sell throughs, like we have that we're completely consistent in, in, in a company like Nordstrom, we're, you know, one of their top selling brands that we have been for the years, we we've been with them.
that means the customer's voting. Yes. And the awareness is the awareness you gain from it is, is spectacular versus how much you have to pay for awareness online. And ultimately it gives us a resonance with our customers and we can speak in an authentic voice and not have to, come up with gimicky programs and gimicky messages to you know, sell a product.
Bill: So I have to ask the name was what trademarked in 1990.
Bill: And where did it come from other than your, the brain of your partner?
Andrew: Yeah, I think, he just loved the name. It's like one of those things that almost becomes ubiquitous, like you, the name, Goodlife, it's it, it felt like something that's been around forever. I can't believe a, a brand, you know, had didn't gobble that up sooner, but actually even before he launched in a real way where he starts selling, you know, big box retailers and he was at one point, he was just screen printing.
It was more of a, he had a little bit more of a street vibe. He was literally making the t-shirts himself. you know, it was really a passion project and he was selling some small specialty accounts. at that time he actually was being offered, fairly large amounts of money to, to buy the name.
The IP had value almost almost right away. and you know, when he, when he was, when he was a younger man doing that and, and you know, earning an okay living, you know, to turn down, you know, it's called six figure sums just to give up the name in which he could just create a new name and, and do what he wanted to do anyway, down the down the line took a lot of conviction.
Bill: It was so smart to trademark that early on. I mean, you think about the web addresses, you know, and you think about the name, Goodlife. I could think about magazines. I can think about any number of publications and businesses that would love to have Goodlife for their product. I think it's, it's, it's a fantastic name because everybody wants to live a Goodlife.
Andrew: I think as we've gotten older, as we've matured and evolved, we realize, you know, what the, the definition of that changes. And like I kind of mentioned in the top of this call was, you know, when you're young that it is that kind of ego thing, it's materialistic and it's, you know, it's achieving successes, whether they're in keeping of your actual identity and wants and what you really want for your life.
Bill: I think almost everyone embarks on a journey over time. Hopefully hopefully sooner, rather than later, I actually had a lot of hope for, for gen, for gen Z right now. I feel like they're, they're, they're ahead of the curve than than my generation where, we took, we took, we took longer to self actualize, but, fun doing it though.
Andrew: What's that?
Bill: I said we had fun doing it though.
Andrew: We had fun doing it and we were left with pretty strong hangovers. You know, mindfulness is is happening younger. So say what you want about gen Z? I have a lot of hope for the newer generations. They tend to be much more mindful. And so, you know, I think, I think Goodlife and living your Goodlife is that journey towards, you know, towards your passion, towards your, your, your self-awareness and identity.
And, you know, it's typically that person that cut their teeth in an industry and then, you know, out of school and gained tons of experience then took the plunge and followed their passions and took themselves out of their comfort zones. And so we're sort of celebrating that journey. We feel like we manufactured tools for that type of living.
Bill: Yeah. So you started online and then you went into the physical space. Is that correct?
Andrew: So we really started wholesale.
Bill: Oh, just wholesale.
Andrew: Yeah, we started wholesale. It was a kind of a traditional route where my partner was doing trade shows and he was selling specialty accounts. And this, this is at the point, you know, in, in, in kind of that beginning, the earlier days of DTC where a lot of these brands were kind of poo pooing wholesale, and everybody that was a dirty word up until just about a year or two ago.
Especially coming out of COVID all of a sudden, all these DTC brands are trying to figure out how to, you know, how to get into wholesale. A lot of these DTC brands, frankly, don't don't have great product cuz they weren't industry or product people. they were just really good at buying cheap ad space on Instagram.
we went the more traditional route, which is the route that we, we think is a much more solid foundation. It brings your customer acquisition costs way down because you're in all these points of sale and you, you gained all this awareness effectively free. That's what you give up for the margin.
And with our own cash flow, we start to invest in DTC. Pretty heavily back in 2018, we did a lot of things and, you know, I'm sure your listeners would, would, you know, probably want advice on how to, you know, build eCommerce businesses and, and, and DTC efforts. And the biggest thing, the biggest lessons are to do as much as, as you could possibly can in house.
there is nothing but agencies support and agencies out there, and people soliciting you to offer you vertically integrated solutions. And frankly, they don't exist. people need to own their data. people need to follow the data and they need to, As quickly as possible, gain in-house expertise, where you have people managing your advertising dollars, managing your campaigns.
Andrew: So they, they have the DNA of your brand and they really speak in your authentic voice. and they're not wasting your money and that's what agencies do. They, you know, they just kind of go full bore and they, they give you spectacular, you know, results and, kind of obfuscate the actual data and your P and L that really matches the performance they say, because they're taking attritions from.
Doubling up on attritions across channels. And you, you really don't know what's going on and you don't actually know the quality of the acquisitions you're making online and will they lead to, to true lifetime value. And what can that look like? Are these people gonna come back and repurchase over and over again?
What is the duration of time that from which they come back each incremental, next purchase what are those average order values each time? Are they going up? Are you, or did you, are you sort of selling Guinea and, and, and not speaking to the right people? so it was very important for us at and we, we, we got very lucky as well.
We have, we have some fantastic advisors that have, that have helped us. So. Earlier than most people do in their life cycle. We start to build out, our internal architecture to address the DTC growth and DTC needs. And that's led to, some really incredible KPIs in the, in, in, in our industry. and that's allowed us to sustain our business, same growth and get through COVID times when, you know, we had forced mature at all of our, wholesale retailers, and still grow and still thrive and still move those KPIs up into the right.
So yeah, and then, the next natural progression was for us was brick and mortar retail, You know, brick and mortar can be a very, very daunting task. And it's a very different thing than, online in the architecture. You have to build online, but in a lot of ways, it's also very similar and they're perfect dovetails.
Andrew: And that's why, you know, a lot of these DTC brands who also, you know, retail in general was, was a dirty word. And everybody focused on the cost associated with, people and and, and leases and buildouts, and you know, but, when you have a brand that resonates with your customer and people truly love you and you truly should exist, they're very happy to have you in their backyard and you can bring a tangibility to, to your brand.
You can bring it sort of illustrate the ethos. You have a billboard now. For a brand like us, we realized, you know, I think my biggest piece of advice there would be obviously start slow. We decided to open our first door in on Bleecker street in New York City, because it was right in our backyard and we, you know, just loved the west village and it's always, it's always got some great traffic and, you know, we learned there's a lot of learnings right out the gate how to optimize retail much.
Like you optimize the website, there's a retail experience, there's a customer journey and you have to follow the customers and you have to, you have to, survey them and you have to, get feedback from, from staff. You have to learn, what your staff should look like. in the sense that what type of personalities, what, you know, how do you train them?
There's so much to learn, in that, that, especially that first six months. And we did that. And in a way we actually, we, we opened our first store pre COVID. It was, it was Q4 19. And in a way that was very fortuitous for us because our first location was actually a bit too small.
Andrew: We had a lot of ideas that, may or may not have worked. We also learned a lot about our brand because at that time we were still doing a lot more, [00:16:00] sort of seasonal newness. We were kind of getting out of our lame, to be honest with you where, you know, we, we, we always have that kind of 80/20 rule where, close to 80% of what we sell is that core year round product.
And that's what we lean on. And we slowly increase what that line looks like. And, I just remember we were, you know, we were selling a lot of sweaters and winter clothing, a lot of seasonal garments, and we realized, well, we don't necessarily wanna acquire customers on these things. These are things that we make to retain customers.
We gain people's trust. They trust our sizing, they trust our quality. And, it's a reason to remind them to come back and purchase their favorite t-shirts. But so in our stores, if front and center is all this, you know, kind of new stuff that we're not known for, will we, what will we achieve lifetime value with, with these customers?
So we learned all these lessons and during, during COVID, when the store was shut down for a few months, we kind of revamped it. Then we, we, we actually considered our current location now, which was, almost double the footprint and a, and a, in a pretty different design package, which is now our scalable design package.
We took advantage of some, some rent deals that were available, during COVID and some of these triple a mall locations that, you know, didn't want to have black boxes as, as they reopened. and so we opened one in Hudson yards in New York, we opened one in fashion square in Scottsdale.
Andrew: We're in the process of, we just opened one in Chicago and off Michigan Avenue, Northbridge, we're opening a second in Chicago in September. We're opening Newport Beach end of this month, we just opened one on Elizabeth Street in New York in East Soho. We are opening one on Newbury Street in Boston in September.
So we're doing this because. We took the time to construct what the, what, you know, our vibe is, what our aesthetic is and what resonates with our customer. and just like in online, just like all DTC, you really have to follow the data. And so we understand exactly how to merchandise and we understood that these units that we've created, we kind of understood what the proper sizes were look the feel.
And when we analyzed our, you know, first couple, our first few locations realized about 85% of the customers are still new customers that are walking in these stores. So it's a phenomenal acquisition channel. And if we start to look at it, which I haven't heard people really speak about yet, but we, we looked at our, our, our operating costs of a store, just like we looked at customer acquisition costs online.
And if you match them up, they, they, they start to match up almost exactly from our true paid acquisition cost to an OPEX number, at, at the store level. And, you know, we, we, we assessed how many new customers per year we can acquire per location. And then we assessed, you know, what does it look like?
What are we estimating that lifetime value to be for the customer? And it was completely lining up with. The, you know, fantastic LTVs that we've been getting online and we've, you know, been, be able to ratchet up into the right every [00:19:00] step of the way. they were immediately lining up with those numbers.
And then it was interesting, the 15 fish percent of, of people that were current customers that were shopping in store have doubled the LTV of, you know, of, of, of the acquisitions that, you know, we we've been making. So we got the LTV lift from our retention customers and we're getting all this acquisition.
Andrew: And so in a world where, it's kind of funny. We, everybody knew these iOS changes would happen, that everybody speaks about where it became much more expensive to advertise and, and effectively and convert in it in a kind of an oversaturated world of Facebook and Instagram. Because we built an internal architecture in house.
We were able to, you know, pivot really quickly pivot our campaigns in the way we manage them. and effectively bring our, our costs of acquisition down. But then we had these, this proliferation of this new channel funneling into into our, our e-commerce business. And then, then there's other channels as well that we're, we're continually advertising on.
Bill: got into physical stores at a time where everybody was saying that brick and mortar was dead. That's pretty phenomenal. I mean, and it's very forward thinking of.
Andrew: And I never believed it. It's one of those things that like, look at the world we live in today, right? Every talking head of TV wants to talk about inflation, death of the consumer, renting a recession. It's a little late for that. You know, it'd be, be, how about talk about that a year or two ago, that would be much more predictive.
Well, the same thing was retail. Retail was dead all through in 2017, 2018. It, it wasn't dead, but it did require some revitalization. And I think what COVID did, interestingly, as it seemed like the world fell apart, There was a lot of easy money out there.
Andrew: And a lot of these landlords took the opportunity with, these centers kind of shut down and then, and really had to rethink their operations. They took the opportunity to revitalize a lot of these places. And because there wasn't, there wasn't the same demand, from the brands themselves.
But there is now because marketing costs have gone up so much. The confluence of revitalized shopping corridors and new brands that people like that are cool. A lot of these cool brands that have popped up, especially in the last 10 years are sort of are, are trying, picking up the slack there's a lot of new, exciting stuff and there's experiential things that going on these short shop quarters as well, whether it's, you know, pelotons or lucid and Tesla motors or medical spas, et cetera.
And so, shopping traffic's come back in a major way.
Bill: I like the idea of working also somewhere where you could just wear a t-shirt and you never have to apologize. It's casual day, every day.
Andrew: Yeah, and we, when you have a premium product and you have the different fabrics that we have, we, you know, we, we have a product that can be dressed up or dressed down.
We have a product that's kind of ubiquitous. so we got very lucky there I have one last question for you and this we ask ever geek guests. What is the best piece of career advice you've ever received? or the best piece of career advice you have to share?
I'm not gonna say I've never received these, these these pieces of advice, but until I lived it I certainly didn't register them. I always knew better. So that was part of my part of my, you know, self actualization Goodlife journey. But my, the biggest advice I would give, if somebody's being in an entrepreneurial way, if they wanna start a business, they wanna start a brand, particularly in apparel.
It better be a labor of love. You better start with a product first. don't follow the money in, in, in a sense that you see these, you know a specific category, getting funding type of things. Sometimes there's just copycat brands, that pop up. If you're really starting from scratch, do something you're passionate about.
Andrew: No, it's going to take longer than you think and it should take longer than you think, because you'll have your head down and you're going to be doing it the right way. And sometimes doing it the right way means there's not going to be that lightning in a bottle where everybody just loves you overnight, or you know, Nordstrom buys you or whatever.
You just have this amazing lift off, it's probably going to be more work than you think, be ready to learn. God knows. I've had to learn a tremendous amount, not only about production and design in the industry, but learning how to manage cash flows in people and, the digital world, which is ever changing.
There's so much to learn and, and you need to enjoy that journey and know whatever you embark on. You better be happy doing it for the next 10 years of your life. That to me, is some Gary V type advice where he talks about, you know, people are so short term thinking, you have to think long term the next 10, 15, 20 years, and, you know, be happy.
Andrew: What you're doing, you will succeed that way. but you don't have to be in a rush. I've said a lot of growth can be overrated too.
Bill: Yeah. Andrew, thank you so much for joining us today. Its been a great conversation. And thank you all for listening to another episode of Retail Gets Real. You can find more information about this episode at RetailGetsReal.com. I'm Bill Thorne. Thanks for listening.