In just four years, movie star Kate Hudson’s Fabletics brand has been able to take over the online fashion retail industry with its clever business strategies and deep understanding of its target customers.
Today, the company is worth over $250 million and boasts several brick-and-mortar stores across the country. Despite the brand’s plan to launch additional physical stores across the world over the next few years, the company remains largely based in e-commerce. Its major selling point is the convenient and unique subscription service model.
On the Fabletics website, you can find hundreds of athletic apparel staples like jogging pants, leggings, sports bras and hoodies. While many athletic apparel brands offer the same products, customers choose Fabletics because the clothes are both stylish and high in quality, not to mention incredibly affordable. Fabletics clothes are made with high-tech fabrics that are resistant to sweat and are incredibly comfortable to wear during intense workouts. The variety of styles, prints and colors also makes the Fabletics website the ultimate destination for any woman who loves to consistently add to her workout apparel wardrobe.
Another thing that makes Fabletics unique is that it encourages customers to join a clever VIP membership program. Upon signing up, members fill out a survey so that Fabletics can determine their tastes and preferences. Then, for $49.95 each month, members receive a full workout outfit in the mail on a monthly basis. This convenient way of purchasing clothing is what has launched the business into success.
Joanie and Heather of thekrazycouponlady.com signed up when they discovered what a deal the brand was offering. VIP members receive their first outfit for only $25. Upon receiving their outfits, they were delighted by the high quality and cute styles of the clothes.
When Fabletics launched several brick-and-mortar stores last year, business experts were surprised. With consumer data indicating that more and more consumers are shopping online instead of in physical stores, many considered physical stores to be nearing obsolescence. However, Hudson opened the stores using the “reverse showroom” strategy that had proven to be a success for tech giants like Apple.
This “reverse showroom” concept uses physical stores to encourage more online revenue. When a customer walks into a Fabletics store, they can observe and touch the clothes and see for themselves that the brand makes high quality products. Then, they are encouraged to sign up to become a VIP member. When they try anything on in the dressing room, it’s added automatically to their online shopping cart.
Instead of aiming to earn a tremendous amount of revenue in physical stores, Fabletics stores serve the purpose of redirecting customers to the online VIP membership program. Fabletics online user data dictates which items go into each store. Regional sales trends determine what types of items should be stocked in different locations throughout the country. If a certain Fabletics item is trending on social media, that item will be featured in stores for a period of time.
The strategy has paid off. The brand now earns more than Amazon’s fashion department which is certainly no easy feat.