Breathing new life into old brick and mortar | Home Accents Today

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While Retail Ecommerce Ventures has only been on the scene since 2019, it hasn’t taken it long to get the home furnishings industry’s attention.

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The Miami-based company specializes in reviving distressed legacy retail brands by reinventing them as e-commerce operations. In the home furnishings universe, it counts Pier 1 Imports, Linens ‘n Things and Stein Mart among its stable of brands. All three were in varying states of trouble (bankruptcies in the case of Pier 1 and Stein Mart, while Linens had essentially shut down in 2018) when they were acquired by REV.

REV purchased Pier 1’s trademark name, intellectual property and other assets for $31 million last July. It kept about 15 of Pier 1’s buying, marketing and customer-support staff, moved its headquarters from Fort Worth, Texas, to Dallas, and relaunched its website in October. It acquired Stein Mart in November for $6.02 million, which included the brand nameplate as well as its private label brands, domain names, social media assets and customer data from Hilco Streambank, an IP advisory firm that was marketing the assets.

REV CEO Alex Mehr said while following the economic principle of buying low played  a role in REV’s acquisitions, it’s only a piece of the puzzle. Brand awareness and brand affinity also factor into buying decisions.

Alex Mehr, Retail Ecommerce Ventures CEO

“These are iconic brands. Pier 1 imports has been around for a very long time and is very loved. You can’t ask for higher awareness of a brand. It’s something that’s very difficult to replicate,” Mehr told Home Accents Today. “You can think about what it takes to recreate a brand like Pier 1, Linens ‘n Things, you’re talking about decades of a brand providing amazing service to its customers to build brand trust.”

To assess brand awareness, Mehr said his business partner, Tai Lopez, applies what he calls the “Amish Test” to any potential purchase, which asks if an average Amish person would know the brand. If the answer is yes, the company proceeds. If it acquires the brand, it combines what that brand was known for with high-level e-commerce operations. The new websites are crafted with the modern consumer in mind while maintaining legacy SEO and searchability.

Once a brand is acquired, it installs its own team of leaders as interim CEOs to help spearhead the rebuilding process. For Pier 1, Rudy Mawer serves in this role while Kimberly Curtis is in the position for Linens ‘n Things.

“As a young, fast-growing company, REV has taken the approach of assigning the interim CEO title to leaders we recruit to head our individual brands,” said Maya Burkenroad, REV president. “There is no set timeline for assigning a permanent title.”

At the time of Pier 1’s acquisition, REV hired Pier 1 executive Brian Thompson, the brand’s former director of global sourcing, to serve as chief merchandising and supply chain officer. He remains part of the leadership team and was key in helping the transition. In October, Thompson met with hundreds of Pier 1 shoppers via Zoom to discuss availability of popular products like its Li Bien Christmas ornaments and its signature fragrances.

“A lot of these are iconic brands that have been around a long time, so they have strong SEO and Google rankings,” Mehr said. “When you are handed something like that, you don’t want to re-platform it overnight and lose all of those rankings. In that scenario, we carefully do it and model the new site after the previous site.”

The relaunch can happen in a matter of two weeks to three months, so consumers don’t have a chance to forget about the brand.

“To us, we pick a brand and we understand what the brand used to stand for and then we provide the same services and improve on it for a more modern, digital world,” Mehr said. “The high-level strategy is straightforward. Take the brand that everybody knows and likes and build on it in the new, more e-commerce-centric way.”

A look at the new Pier 1 website, built after the brand was bought by Retail Ecommerce Ventures.

Part of keeping the brand in the conversation is maintaining ties with longtime consumers while reaching out to potential customers. REV told Forbes that it plans to sell products under the Pier 1 and other brand names on Amazon and Walmart’s marketplaces as a way to expand its base.

“We want to keep the legacy customers from each of our companies. They’re the ones who made the brands so iconic but we always want to expand our customers,” said Curtis. “For example, Linens ‘n Things hasn’t been open for a while so maybe we want to bring in younger customers. It’s a combination of both.”

In many cases, those legacy customers appreciate that these brands still exist in some form.

“Every day on our social media platforms on Pier 1, we have hundreds of comments about how they miss the stores and they’re glad it’s online,” said Mawer. “Sometimes we forget that it means a lot to these people. For them, it means that one of their favorite brands can continue.”

And once customers know where to shop and the sites are up and running, analytics are used daily to get a feel for what’s selling best and what could sell next.

“It’s a deep dive into trends, looking at things the customers love and doubling down on that. For Pier 1, we have a team that analyzes the purchases and top products and looks at what else can we sell that matches those customer needs,” said Mawer. “That way, we’re always staying relevant. What gives us the competitive edge is we’re doing this on a daily basis. Other companies are looking at what they’re bringing in the next quarter or two quarters ahead. We’re doing it on a micro level every day.”

With a diverse portfolio of brands, Mehr noted that each has its own individual teams of buyers. But that’s not to say there isn’t any crossover between brands, particularly when their product assortments complement one another.

“Most teams have their own buyers but we do work closely. We meet with each other regularly and discuss vendors,” said Curtis. “If we find a vendor that might not be a good fit for us but is a good fit for another of our brands, we’ll hand them off. Generally, our buying teams have their own points of contact at the vendor.”

Added Mawer, “Some of the vendors we work with have multiple divisions, too. As a group, we can have more outreach with vendors and more connections and it can snowball for us. The vendors like it because they have multiple divisions and can now serve multiple brands under our umbrella.”

For sourcing, take Pier 1, for example. Mawer said it has a combination of its own private label products, some self-sourced products and others that it procures from vendors (for instance, under non-pandemic circumstances, its buyers might be found visiting showrooms at Las Vegas or High Point during a typical market). He said his team of buyers has the ability to go as broad as it needs.

“That’s the beauty of being online; you can have more products. It’s a blend of going broad, meeting customer needs, testing new product ranges, staying true to the original Pier 1 brand but challenging the brand to keep growing,” Mawer said. “Like anything, you have to evolve and grow. It has to make sense to the customer and it has to make sense for the company.”

And part of REV’s ethos is online makes more sense for these brands. The value of e-commerce was never more apparent than in 2020, when all non-essential brick-and-mortar businesses were closed for varying periods of time and online shopping was often the only way for consumers to shop. While the physical store will always be a retail fixture, e-commerce continues to gain acceptance.

“I think this past year has shown us that consumers don’t need a brick-and-mortar store to purchase something,” Curtis said. “People are building their customer service and their e-commerce to tailor it to the consumer so they don’t have to shop in stores anymore if they don’t want to. I don’t think traditional shopping will ever be the same.”

Mehr noted that by being online, the brands don’t have the constraints of building size or geography in place and can meet the consumer when and where they want.

“In general, when you’re mostly brick and mortar, you’re at the mercy of people who walk into your store. It’s the geographic location of your store; what kind of people traditionally walk into the store; the size of your store. Those things determine the walk-in traffic. Based on that, you merchandise according to the walk-in traffic and it becomes a self-fulfilling prophecy. When the store has a limited capacity to store product, you have a limited capacity of SKUs so you tailor to the walk-in traffic,” he said. “In e-commerce, you can control your target market; you can go wide, narrow, [into other] sub-categories. Second, you can customize the experience. You have a product that appeals to one audience and then another product that appeals to another audience. It’s like expanding circles. The middle is the type of product the brand used to sell to the type of audience it used to sell to. You start with that and don’t want to lose that. Then you introduce different categories or vendors and layer it on top.”

In terms of financial benchmarks and historical comparisons, Burkenroad noted that REV doesn’t disclose its financial data, but its growth targets are attainable and within historic expectations.

“Generally speaking, our first-year goal for each brand is to rapidly ramp up revenues over historical pre-acquisition levels for that brand’s legacy online business,” Burkenroad said. “As each brand is anniversaried under REV ownership, our objective is to attain double-digit year-over-year growth, dependent, of course, on economic conditions.”

So what is REV’s long-term strategy for its brands? While some firms are in the business of buying brands, reviving them and flipping them for a profit, Mehr said this company is in it to be a retailer.

“In general, we’re not sellers; we’re buyers. We want to buy them, operate them well and turn them into huge, standalone companies that people love,” he said. “We want to return it to what it was before and then grow it from that point.”





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