If there was a specialty retailing for dummies, there would be a chapter connecting the craft beer phenomenon with e-tailer Revolve Clothing’s rise.
The 13-year-old multibrand online shop, with sales expected to surpass $600 million this year and likely to hit $1 billion by 2018, has placed a premium on emerging brands to maintain its trajectory and satisfy consumers’ search for the special and undiscovered. That’s a trend that speaks across industries, pointed out cofounder and co-ceo Mike Karanikolas.
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“I think everyone understands the shifts that have happened in the beer industry, for example,” he said. “Fifteen years ago you go to the grocery store [and] you had your choice of Miller, Bud and maybe a handful of other beers. You go there today, there’s hundreds of brands to choose from, half of whom you’ve never heard of. All of them interesting and desirable and special. And that’s what we bring to the consumer in the fashion space.”
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That’s one part, but the other part — and just as important — is the ability to feed that Millennial customer Revolve so successfully speaks to, with a constant stream of product to peruse that’s of the season and ready to buy immediately.
“Today’s consumer doesn’t want new product four times a year like in the traditional schedule,” said cofounder and co-ceo Michael Mente. “They don’t even want new product every month of the year. They want new product every single day. That’s what excites them.”
Some might say there’s nothing more instant than buying from a physical door and brick and mortar is something Revolve reentered this year, but with a twist on the concept with its Revolve Social Club. The space on Melrose Avenue in Los Angeles is invite only and not built for sales per square foot, Mente said.
“There’s definitely some commerce that takes place there, but the real goal is that engagement on the web site in the long term, and we know that coming to the Social Club and shopping is great,” Mente said. “But we also know that going on your phone every morning and seeing new arrivals is even better.”
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A major push into physical retail could be in the future but is not an area of focus in the near term, Karanikolas said. International is also another longer-term goal.
And then there’s always strategic acquisitions. Revolve closed on its purchase of Alliance Apparel last year, bringing into its fold three brands. If there are more deals, the focus would likely not stray from the company’s strength in emerging brands.
“I think it’s unlikely we’d be interested in something that one might call the old guard of physical retail, but I think with any acquisition, it’s all about understanding how it fits into what we do,” Karanikolas said. “Can we add a lot of value there that might turn around the company, that will accelerate the growth in a substantial way? So for us it’s typically been emerging designers and things of that nature that we’ve looked at.”
Both agreed balance and moderation in growth strategies is important and that’s what has allowed Revolve to scale at the rate it has.
“When the opportunities are there, of course we all want to seize that,” Mente said, “but at the same time, growing as fast as you can keep up with it is super key. Sometimes it sounds crazy to skip growth opportunities when they do exist, but if you can’t keep up, they’re equally dangerous.”