Allbirds, the eco-friendlier and profitable online consumer-direct brand best known for its merino wool sneakers, is growing its product line and its customer base by opening stores — even in the midst of the novel coronavirus pandemic.
The company, which debuted its first stores in San Francisco and Manhattan in 2018, has continued to open new locations in 2020, including its first in Philadelphia, reports The Philadelphia Inquirer.
Photo by David M. Benett/Dave Benett/Getty Images
“I think Allbirds is making the right move here,” wrote RetailWire BrainTrust member Mark Ryski, CEO of HeadCount Corporation, in an online discussion on the online business forum last week. “While DTC [direct-to-consumer] will continue to be their bread and butter, they also recognize the importance of physical stores, and so opening stores in select markets makes perfect sense. Naturally, running physical stores presents new challenges to DTC brands, however management appears to be thoughtful in their approach. Overall, this is a good and smart move by Allbirds.”
“Zig when others zag has to be one of the first principles we all learned in our earliest marketing course,” wrote Ian Percy of the Ian Percy Corporation. “Following that principle has always required a lot of courage and creativity but, at this point at least, it looks like it’s working for Allbirds.”
In keeping with that, some BrainTrust members said they think other brands operating similarly should take note.
“Excellent,” wrote David Adelman, founder of The Adelman Group. “It’s a perfect time for D2C companies to open brick-and-mortar stores with depressed rents and a pending retail renaissance coming this fall. This will lower Allbirds’ cost of acquisition as their rate and cost of returns. It will also provide the much needed personalized connection consumers want with a brand.”
“Both Amazon
One BrainTrust member, however, urged caution about going too far with a physical expansion.
“If Allbirds is careful about store placement decisions (sticking with online customer concentrations) and stay low on store count, they’ll be OK,” wrote Lee Peterson, EVP of thought leadership and marketing at WD Partners. “But the minute they hit 100, look out — just ask L’Occitane.”
Photo by David M. Benett/Dave Benett/Getty Images
The 2,090-square-foot store in Philly is one of 23 locations stretching from the U.S. to New Zealand, home of co-founder Tim Brown, a former footballer (AKA soccer player) and entrepreneur. Joey Zwillinger, the other co-founder and an engineering and renewables expert, is from San Francisco.
Travis Boyce, head of global retail operations for Allbirds, told the Inquirer that the decision to open in Philadelphia was informed by its online sales data that showed the company’s products had a significant following among local consumers. The Walnut St. location was deemed a good fit, Mr. Boyce said, because the “area has a great mix of shops and is a destination for a wide array of consumers, so it immediately came to mind as the perfect location for our first store in the city.”
Allbirds’ physical store expansion aligns with a broadening of its product range in recent years, which started with the addition of running shoes to the brand’s all-purpose sneaker line. Since then it has added footwear choices, socks, underwear and a range of apparel, including t-shirts, sweaters and outerwear.
With all its growth to date, Allbirds remains committed to taking as little out of the environment as possible by finding new uses for material such as wool. The manufacturing process utilized by Allbirds in making its wool sneakers uses about 60 percent less energy compared to traditional synthetic shoe manufacturing.
The brand is very serious about its ecological bonafides. Allbirds’ co-founders offered to share how they make their sneakers with renewable materials with Amazon.com CEO Jeff Bezos so his company could ditch some of its oil-based manufacturing processes. Allbirds’ SweetFoam process is open sourced, so the free offer wasn’t just for Amazon.
Mr. Adelman pointed out that the brand could extend this into the physical world, so long as it did so authentically.
“Not only will Allbirds be able to tell their responsibility story but now they will also be able to show it!” wrote Mr. Adelman. “The only caveat for me would be that the rollout occurs in select community locations under small store footprints.”
