We’re building the future of retail.
Because brick-and-mortar retail is archaic AF.
Over the past few years, our industry has thrown around alarming catch-all phrases to capture the dire state of brick-and-mortar retail in America — phrases that, to our amusement, often sound like they’ve been ripped from a trashy tabloid cover. “Retail APOCALYPSE,” “retail MELTDOWN,” “retail’s RECKONING,” or our fave, “The Great Retail Extinction” (is there an asteroid coming? Like with the dinosaurs?). While amused by these panicked terms, we’re definitely in agreement that physical retail is in bleak, rapid decline. Retailers are filing for bankruptcy in record numbers. And though we’re not even halfway through 2017, twenty big-time brands have announced early terminations for three thousand brick-and-mortar locations nationwide. But we don’t need to throw data at your face to drive this point home. Just stroll up and down most main-streety type blocks in the US and you’ll see empty storefront after empty storefront, haunted by the ghosts of JCPenneys and Abercrombies past.
What’s up with all this doom and gloom? We think physical retail is failing for three big reasons: the internet, underinvestment, and a refusal to craft in-store experiences.
It’s no revelation that Amazon has pretty much taken over the world, or at the very least, digital commerce. Over 50% of US households use Amazon Prime and can order anything from toilet paper to an iPhone to a Rebecca Minkoff dress in just a few clicks, and have it in their hands in just a few days. In fact, “apparel and accessories” is now the strongest ecommerce category.
So to be clear here, it now makes zero sense to go to a store for any of these things. Because we can watch Netflix and gorge on Seamless while restocking on toilet paper and ordering a new Reformation dress. That means it would and should (!) take a LOT to get you off your butt and into a store. Because of the internet, brick-and-mortar retailers are now not only competing with convenience, but with content. And no offense to the 20-odd retailers we mentioned earlier that are closing shop, but I’m not sure a trip to Payless or BCBG IRL can compete with a stay in my cozy bed, with my very personalized Instagram feed and the latest episode of Real Housewives of God Knows Where.
Stores are stagnant, brands DGAF
And let’s say we do give Payless, BCBG or even Sears a chance (lol). There’s a super high likelihood that these stores will feel outdated, maybe even dilapidated, due to both underinvestment and a lack of innovation. We can all think up a recent visit to a store that felt sad and stagnant with merchandise that felt stale and repetitive. According to AlixPartners, that’s because it IS repetitive — there’s a 40% product overlap across departments stores this very second. You’d think after signing obscene 10-year leases and throwing millions of dollars into making a store that these guys would feel pressed to innovate, hack a way to get foot traffic or maybe just like… figure it out. Sometimes that happens. Big, old school brands and retailers are known to hire a social media influencer or glob on some new interactive store experience. The problem is that it never feels authentic, and tbh, you’ve already mentally associated these big brands with The Past. Archaic Times. Even more, these stores aren’t physically optimized for experiences, they’re optimized for conversion. That’s why sales reps have quotas. It’s why there’s a checkout counter. And why everything’s on sale.
Experience is Queen
But in 2017, experiences are everything. And it’s what you and the rest of the country are spending most of your money on. This trend is evident across industries like hospitality, dining and travel, where hotel occupancy is at record capacity, global spending on travel and tourism is surging and Americans are spending more money dining and drinking out than they are on groceries. It’s official: we’re fatties, ya’ll. But in all seriousness, we’re definitely hungry: for sights over stuff, places over products, social activities over solitude. Successful retail stores know this, and have baked experience into the DNA of the space.
We love Glossier’s showroom, which regularly hosts events and in-depth skin and makeup consultations for its cult social following. Outdoor Voices’ #doingthings campaign and Doing Things Day is another great example, activating their social community IRL and hosting workout meetups at their NY pop-up store. Apple’s new Today at Apple program is an initiative that squarely puts engagement at the forefront, where experts will host in-store seminars on everything from photography to brand-building to coding. As Forbes put it, this program represents , “the essential step in transforming retail from a product-based (i.e. selling Apple computers and iPhones) to a people-based business.” If you’re a physical retailer and you’re NOT doing this — i.e. you’re pushing conversion over conversation or products over people, you are destined for the so-called Great Extinction. As we explained earlier, it’s going to take a heck of a lot to get someone off Instagram, Amazon, or any other ecommerce site for that matter, and into your store.
What We’re Up To
For the past two years at Bulletin, we’ve been investigating a solution to the impending Retail Apocalypse, this outbreak of brick-and-mortar death caused by the rise in digital commerce, a lack of investment and innovation, and the new fiendish need for experiences. We’ve debated whether sad and stale stores can turn it around — if there’s a new format or structure or platform out there to fix the Macys and American Apparels of the world. But just like a real apocalypse zombie bite, there’s no real antidote here. If you’re a dated brand saddled with thousands of poor performing stores, you’re kind of screwed.
Then we asked ourselves, “Okay, then what would a brand new, successful store look and feel like in 2017?” We answered that question, and then we opened two of them.
Bulletin is building the future of retail. That future features dynamic, social, community-oriented stores filled with passionate brands that have something to say and an audience that loves them. And these brands 1,000% exist — the problem is, physical retail is so exclusive by nature, they’re all online. Thanks to Etsy, Squarespace, Shopify, Weebly and more, creative people are launching compelling brands with awesome products every single day. Every minute probably. And these brands are fresh and reactive. They can easily tap into and even create Instagram trends, reference pop culture and build online communities. Even more, Facebook ads, Mailchimp, Insta and YouTube make it easier than ever to engage with your online audience once it’s built. As dated brands struggle to get foot traffic to dying stores, there are new, nimble players that are capturing attention online — and they’re desperate to activate their communities in the flesh.
We’ve basically taken all three foils to physical retail and made them our friends. Simply put, Bulletin has built the WeWork of retail space, a rent-share model where the coolest, digital-first brands can sell in an actual store, host experiences and delight their customers. The internet doesn’t scare us. We’re actually referencing the internet to help our stores make sense. First, we curate the most popular e-commerce brands and recruit them for a Bulletin store. Then, by leveraging sharing economics, we calculate an affordable rent-share fee, so these younger, fresher players can afford retail for the very first time. The sharing model allows us to democratize retail, which has parted the Retail Red Sea and allowed smaller, more authentic brands to show the industry how retail is done. That, and it mitigates the ridiculous price of real estate for all parties. It helps address the issue of insanely long lease terms, and brings a certain flexibility to space rental that’s never existed before, beyond co-working. If WeWork can get your company office on a short-term lease agreement, why can’t a small brand license retail space for 2 months while they launch a new product?
It’s critical to us that we host these digitally-native brands in a store that feels innovative. We’re determined to open spaces that provided brands a level of transparency and control that they fundamentally lack with wholesale or consignment. That means our brands can login to our platform and see sales in real-time, just like they can with their e-commerce channels. While transactions go through our POS, they keep their customer data, information they’d completely lose doing offline retail anywhere else. On top of all this, we can usually get a new brand in-store and merchandised in five days or less, which is completely unheard of in traditional retail. Instead of pitching buyers, slaving over lookbooks, and sending samples back and forth, brands can apply and book space in just a few clicks by giving us their Insta handle + website. We’ve tried our best to decentralize retail and disrupt this overly complicated, dated process of soliciting Retail Overlords at Big Companies that are tangled up in red tape.
While this new innovative process has changed the game for our brands, experience is the most important element of a Bulletin space when we think about the shopper. We didn’t build a lounge by accident, or recruit popular Insta brands for fun. As part of the rent share model, any Bulletin brand can host unlimited events and activations in their respective space. For us, this is instrumental in driving foot traffic (duh), but also honing in on a people-based business, to reference the Forbes piece on Today at Apple. We believe retail spaces should be about bringing people together, not just selling a product. At Bulletin Broads, our Williamsburg store where 35 female-run brands rent space, we’ve hosted everything from embroidery workshops to write-your-rep nights to launch parties. Our SoHo space has been averaging three brand events per week, too. Providing experiences facilitates community, both across the brands, and of course with our customers that attend and interact. It also helps us stay relevant and ties our brand to a feeling of discovery. In an Instagram world where we’re feasting our eyes on new content 24/7, in-store events allow us to “do” content, too. We can provide constant, fresh engagement opportunities, whether hosted by Bulletin, one of our brands, or multiple brands joining forces. It’s no biggie if you don’t drop dollas in-store during the event. Now you know the store is there, you had a good time, and the data shows us we’ll see you again soon.
New York has been an ideal playground for us. It’s a city filled with creative entrepreneurs and incredible e-commerce brands. Here, we’ve been able to test different iterations of the model, work with a variety of product categories and evaluate individual neighborhoods. But now, armed with enough evidence that our model is working, we’re excited to eventually expand and bring Bulletin’s model beyond the walls of NYC. We have our sights set on LA in the short-term, and long-term, we’re seeking world domination (dream big or go home!) While there are definitely (and always) bits and pieces we need to figure out, there are certain things we know for sure. The country is plagued with over half a million empty storefronts because crazy ten-year lease terms and obscene rent costs no longer make sense given the rise of e-commerce. We know big brands are struggling to leverage physical retail in a productive way, and are scaling back on stores instead of testing risky new approaches or innovative solutions. By looking at companies like Glossier, Outdoor Voices, and Apple, we know stores are better used as an engagement tool than a pure revenue driver because customers seek content and experiences, not just product. And there are millions of digitally native brands that are eager to offer these experiences and engage their customers IRL. They just need turnkey, flexible terms that have been completely absent from retail and real estate to date. Bulletin is the answer.
Our model yields a more intimate, personal store experience where brands can connect directly with their consumer. We’d love nothing more than for our stores to become the gathering place for these thriving internet communities making and sharing beautiful products that are now, finally, seeing the light of day.