The click-to-brick strategy has become a rite of passage for major digital native brands. After reaching a growth threshold through direct-to-consumer channels, many brands, such as Warby Parker, Bonobos, Allbirds, Glossier and Fabletics, have opened branded stores to build on their momentum and reach new customers.
It would be the expected playbook for a DTC darling like fashion jewelry brand BaubleBar, but it’s a path BaubleBar is reluctant to take.
As it launched into three brick-and-mortar stores with pop-ups, including a six-month trial in 2015 at Roosevelt Field on Long Island, BaubleBar founders Daniella Yacobovsky and Amy Jain say, âWe dream of do it one day, but nothing in the short term.
Quite simply, she does not need to make the necessary investment to operate her own stores. It combines DTC’s e-commerce and distribution partnerships with powerful retail players quite well, such as Bloomingdale’s, Neiman Marcus, Nordstrom.
Yacobovsky and Jain are exceptionally savvy managers of their money and business. They met while working at UBS, then moved on to Harvard Business School where they made the BaubleBar business concept a classroom project. With MBAs in hand, they turned down offers to return to investment banking and created BaubleBar instead in 2011. It became an overnight success.
At first, the couple turned to venture capital to help grow the business, but after five rounds that raised nearly $ 50 million through 2017, they haven’t returned since. They didn’t need it after the business became profitable in 2018.
The success of BaubleBar is based on targeting an ideal point in the $ 325 billion global jewelry market: affordable fashion jewelry with a price between cheap costume and high jewelry.
“We saw that the prices were either very high or low, $ 1,000 or $ 10,” says Yacobovsky. âYou either bought an item forever or a piece of costume that looked cheap. There was a gap there.
BaubleBar thinks jewelry should be fun
âWe design our jewelry and accessories with the BaubleBar nod,â Jain explains. âOur accessories are meant to be a playground to create your unique everyday look. “
With affordable prices and an avant-garde fashion outlook, BaubleBar enjoys significant repeat purchases from customers who view jewelry as a means of self-expression.
âOur customers love to tell her story through jewelry. Whether it’s large earrings or necklaces, small figures and collectible “trinkets” or accessible jewelry pieces as the basis of a jewelry wardrobe, we help people celebrate theirs. passions and their hobbies, âYacobovsky shares.
BaubleBar also offers customizable jewelry and accessories, like cellphone covers and cases, to showcase initials and names. And customers can stack a collection of personalized bracelets to communicate a message.
Licenses offer customers new means of expression
Anxious to bring more pleasure to its customers, BaubleBar extends its licensing program to sport. He first tested licensing waters with Disney last year, which was a home run. And by examining other hobbies and passions that its clients want to express, BaubleBar has chosen sports as its next foray into licensing.
âWe are constantly thinking about the things people want to wear and have found that we have a passionate sports fan base,â Yacobovsky shares. “We started having conversations internally and externally with female fans and found that women love to dress up when they go to games or watch games in sports bars or with a group of friends.”
While sports team logo jerseys, t-shirts and sweatshirts are the match day uniform for sports fans, the addition of a pair of team earrings and of a necklace enhances the look.
âWe hear all the time that people stop our customers and ask where they got their earrings,â she laughs. âWe felt this was relevant to our clients and aligned well with our philosophy of bringing their passions and hobbies to life. “
BaubleBar started with the license from the National Basketball Association and has since expanded into football with the National Football Association.
âWe did our research and found almost half of football fans are women. It adds joy, playfulness and whimsy to our product line, âshe adds.
Find space at the jewelry counters of retailers
The cheerful, playful and whimsical vibe of BaubleBar is what opened the door for luxury retailers such as Bloomingdale’s, Neiman Marcus, Nordstrom, Selfridge’s and Le Bon Marche. BaubleBar helps to complete their jewelry offering, widens the prices of their assortments and gives a nod to customers who tire of the seriousness of expensive luxury jewelry.
BaubleBar uses its in-depth customer preference data to help develop assortments for each of its retail partners.
âWe’re a very SKU-intensive business,â Jain explains. âWe use our data from e-commerce to make our product development process smarter and eliminate subjectivity. And we have a clear understanding of who our retail partner’s customers are so we can make recommendations to everyone who is a proven seller.
At the mass market level, BaubleBar has partnered with Target in an exclusive Sugarfix by BaubleBar brand that is present in all 1800+ Target stores. To keep the assortment fresh, he creates 75-100 new styles every six to eight weeks for the line.
While many digital native brands have shifted away from wholesaling through established retailers, BaubleBar decided they could learn a few tricks from the biggest and best.
âThere are a lot of advantages for a company like ours that started DTC to have a partner like these big retailers. They are interested in helping us to be better and grow the business together, âJain said, noting that being worn by such respected retailers provides additional validation for potential BaubleBar customers who don’t. have met that online or on social networks.
Although BaubleBar won’t reveal its sales, the founders shared that just over half of its business is currently going through its DTC ecommerce platform. They are also proud to report that in fiscal 2021, the company achieved 45% year-over-year growth. In particular, her statement earrings and necklaces were big sellers during the pandemic for customers to dress up for all those virtual Zoom meetings.
And the company expects further growth of 50% in 2022, as sales of its licensed collections accelerate. Its licensed division is expected to account for at least 10% of revenue in fiscal 2022.
When it comes to BaubleBar’s future plans in click-to-brick expansion, the company is volunteering its time.
âAs we’ve expanded into new categories like fine jewelry, home accessories and tech and now licensing, we’re very careful before we really get buttoned,â Jain said.
âOur pop-up tests were successful and gave us confidence in the economics of opening BaubleBar stand-alone retail stores, but we prioritized other growth initiatives. Over the years, we’ve learned a lot from our large-scale partnerships about the importance of just execution. Until we have the free space to be able to take it on and develop processes to execute perfection in retail, we will wait, âshe concludes.