Bulletin, a venture backed by the Y Combinator with two locations in New York City, has opened its largest store, a 1,500-square-foot flagship at 863 Broadway near Union Square. The company said it has lowered the barrier to entry for digital brands through its membership-based retail model that allows brands to “rent” shelf space for their products and benefit from the real-time sales data Bulletin provides.
Ali Kriegsman and Alana Branston, Bulletin’s cofounders, said the Bulletin Mini Mall, a temporary Nineties-themed concept that operated at the Broadway space from November 2017 through January 2018 — before build-out on the permanent store started — exceeded sales goals, confirming their belief in the project. “Seeing the customer interest gave us confidence to open a store this size and in this location,” Kriegsman said, adding, “We felt we were ready.”
Branston said the cost of renting space at the new Bulletin flagship ranges from $350 to $1,500 per month. In addition, Bulletin takes a 30 percent cut of sales. “A lot of brands do better with our model than selling wholesale to department stores,” Branston said. “We provide brands with customer feedback and we do product consulting.” In some cases, Bulletin represents digital brands’ first foray into brick-and-mortar.
Bulletin’s business model isn’t entirely new. B8ta, a software-powered retailer, charges brands a monthly subscription fee in exchange for space in its stores and provides services such as branding, logistics, training for in-store staff and data and analytics. “We give the brands 100 percent of their sell-through,” said Vibhu Norby, b8ta’s chief executive officer. “We pioneered this. We call this model retail as a service.”
While Norby said he’s “happy to see other people doing this,” he cautioned, “once you execute the business model, you can manage one or two stores. Once you start scaling, you need the software to manage the brands coming in and out of stores and to maintain the experience of the brands in the stores.”
B8ta operates a dozen stores across the U.S., including locations in California; Texas; Oregon; Washington; Illinois; and Virginia; and a shop at Macy’s 34th Street flagship. Macy’s participated in b8ta’s recent Series B funding round, which brought in $19 million. Macy’s is taking some of the same principles that power b8ta spaces, and the same software, and using it to create unique assortments. The software allows brands to sign up online and gives Macy’s the tools to evaluate brands.
The average b8ta location offers about 120 different labels, said Norby. “The minimum tenure is six months, but we have brands that have been with us for close to three years. A brand’s shelf life is a function of sales and whether it resonates with customers. About 10 percent of the assortment changes every month “because brands are launching new products all the time,” Norby said.
Bulletin’s proprietary software, Omni, was developed for inventory, merchandising and tracking needs, as well as getting feedback from brands.“Alana and I don’t have traditional retail backgrounds. We started as online-only and experienced how hard it is to stand out online,” Kriegsman said, “We see [Bulletin stores] as a way to supplement online. It’s getting trickier to target the right customer.”
“We’re playing with color more,” Branston said of the flagship with pink bleachers and cash wrap and three bright yellow dressing rooms dedicated to one of three performers, Britney Spears, Cardi B and Rihanna. “We designed the store to be very modular and flexible,” Kriegsman said. “We have 60 brands that will move in and out of the space. We work on a sku count with each brand and work with them to hit their sales targets.”
Bulletin early on charged brands by the amount of square footage they occupied, but realized that the merchandise strategy didn’t convert products into sales.
“We see a lot of gifting at our NoLIta and Williamsburg, Brooklyn, locations,” Kriegsman said. “We really leaned into apparel and beauty at the flagship. Stickers, pins and patches are important so that any girl can come in and afford something. We want to be an accessibly priced destination.”
That’s the thinking behind a candy wall. Vegan leather handbags carry some of the store’s highest price points, with styles by Angela Roi, $125 to $150. Bulletin is wearing its politics on its sleeve with pro-feminist T-shirts with messages such as, “Nevertheless She Persisted.” The company donates 10 percent of sales to Planned Parenthood.
B8ta is moving in a non-tech direction. “We’ve brought in more apparel nutrition and cosmetics, things that resonated with a wider audience,” Norby said. “There’s a lot of seasonality in retail. That’s where data is really helpful. None of our stores offer the same merchandise. A given store will have one-third to half of our active brands. We have more stores opening this year and more opening next year.” Norby declined to discuss locations, saying only, “There’s a bunch.”