How Many Storefronts Do You Need? MULO Logic
The mattress company Purple became a huge success on Shopify when it first launched. It then expanded into retail locations. Last year, the company took a close look at its brick-and-mortar retail storefronts and saw that a third of its physical stores were struggling.
Like many brick-and-mortar MULO (multi-location) businesses, expanding from online sales to retail locations can be expensive and challenging.
The evolution from screens to storefronts is both an art and a science. As in the case of Purple, competitive forces (the sale of Mattress Firm and the birth of countless other bedding brands) posed challenges.
Some retail brands revert to online sales only to stay alive. Consider Bed Bath & Beyond, which “merged” with Overstock following bankruptcy. Or the switch of Lord & Taylor to an online-only brand.
Other brands like Warby Parker and Bonobos seem to have made an effective transformation to omnichannel (online and in-person) sales, integrating the shopping experience for consumers.
As with all MULO business expansion, the keys are:
- Build a brand experience that’s consistent and seamless between online and real-world.
- Locate your stores in areas where you have enough of the right traffic (across the right personas) to deliver volume.
- Take only as much space as you need. Micro-locations and stores-within-stores are becoming popular these days. And, if your brand is doing a great job of #1, if you don’t have inventory in-store, you can easily and quickly get it to the customer
- Market effectively — at both a national and local level. Don’t scrimp on spending for both grand openings and ongoing promotions. Give your locations enough autonomy to market within their neighborhoods. Keeping stores alive and well needs to be a collab between management and individual store operators.
- Above all, use data constantly to understand which locations are struggling and which are thriving. Make speedy decisions about store closings, but manage communications so that customers know where the next nearest store is and how they can order the products they love.
And, of course, learn from other brands that have experimented (successfully and not) with the evolution from online-only to a combination of digital and physical shopping. The stores you save may be your own!
